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ARTICLE · 05 FEBRUARY 2020

Competition Insight: Restrictions On Dealers

After assessing the competition law validity of restrictions imposed by car manufacturers on their dealers in multiple cases, the Competition Commission of India is currently examining similar issues in the two-wheeler industry.

IndiaAntitrust/Competition Law

(CCI's prima facie view in a case against Honda Scooters)

After assessing the competition law validity of restrictions imposed by car manufacturers on their dealers in multiple cases, the Competition Commission of India (CCI) is currently examining similar issues in the two-wheeler industry.

A dealer of Honda Motorcycle and Scooter India Private Limited (Honda) filed a complaint (information) alleging that some of the restrictions imposed by Honda on its motorcycle and scooter dealers violate certain provisions of the Competition Act, 2002 (Competition Act).

Based on the information provided by the dealer, the CCI formed a prima facie opinion that Honda violated Section 4 and Section 3(4) of the Competition Act and passed an order under Section 26(1) directing the Director General to conduct a detailed investigation into the business practices of Honda, especially in relation to the restrictions imposed by Honda on its dealers. Section 4 relates to an abuse of

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