No violation by Coca-Cola’s India bottling arm, Inox multiplex; CCI dismisses unfair trade pleas

By: | Updated: March 5, 2019 8:46 PM

The ruling came on a complaint filed by Telangana-based Vijay Gopal who alleged that Inox has colluded with Coca Cola by entering into exclusive supply/sale agreement to sell water/beverages within the multiplexes at higher prices.

Coca Cola, Inox multiplex, Hindustan Coca Cola Beverages, CCI, AAECThe ruling came on a complaint filed by Telangana-based Vijay Gopal who alleged that Inox has colluded with Coca Cola by entering into exclusive supply/sale agreement to sell water/beverages within the multiplexes at higher prices.

The CCI has dismissed a complaint alleging unfair trade practices against multiplex chain operator Inox and Hindustan Coca-Cola Beverages, the bottling arm of Coca Cola in India, with respect to selling of beverages in multiplexes. There was no violation of Section 3 of the Competition Act that pertains to anti-competitive agreements, the CCI observed while disposing of the matter.

The ruling came on a complaint filed by Telangana-based Vijay Gopal who alleged that Inox has colluded with Coca Cola by entering into exclusive supply/sale agreement to sell water/beverages within the multiplexes at higher prices.

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Besides, the complainant alleged that consumers are forced to buy essential goods like water in multiplexes, and therefore there exists an implicit tie-in arrangement which is prohibited under the Competition Act. By entering into such agreements, the firms violated Section 3 of the Competition Act, the complainant alleged. With regard to the agreements between the two firms, CCI observed that there exists no appreciable adverse effect on competition (AAEC), which needs to be established in order to examine any possible violation of Section 3.

Dismissing the allegation of tie-in arrangement, CCI said there is no explicit condition that consumers have to necessarily buy these goods to watch the movie. Moreover, Inox also provides free water inside the multiplexes, CCI noted in an order dated February 28. Accordingly, the Competition Commission of India (CCI) “closed the matter” as it found no contravention of the Competition Act.

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