Hyundai has been fined Rs. 87 crores for unfair business practices with respect to providing discounts for cars.
The Competition Commission of India (CCI) has Hyundai fined Rs. 87 crores for adopting unfair business practices with respect to providing discounts for cars. Also, the company has been directed by the CCI to refrain from such anti-competitive practices.
The regulator in a 44-page order has said that the carmaker had resorted to anti-competitive practices that included putting in place arrangements that resulted in the maintenance of resale prices for the cars by way of monitoring of maximum permissible discount level. Also, the company had contravened the laws by ordering its dealers to use recommended lubricants and also penalising them for non-use of such recommended lubricants.
It was also alleged that Hyundai has a discount control mechanism whereby dealers are permitted only to provide a maximum permissible discount and not beyond the recommended range. CCI says such practices relates to and emanates out of the sale of motor vehicles. Hence, it has considered revenue from the sale of motor vehicles alone for the purposes of determining the relevant turnover for this violation.
The penalty of Rs. 87 crores amounts to 0.3 percent of the company’s average relevant turnover in the last 3 financial years from 2013-14.
Hyundai Fined Rs. 87 Crores
– Hyundai has been fined Rs. 87 crores by the CCI for adopting unfair business practices
– The carmaker had penalised its dealers for the non-use of some recommended lubricants
– It was also alleged that the carmaker has a discount control mechanism