Keeping up with Competition - March 2026
A monthly newsletter by Axiom5
Welcome to the 30th edition of Keeping Up with Competition.
Over the past month, the Indian antitrust landscape witnessed some significant developments across various sectors. The Competition Commission of India (CCI) and appellate courts tackled questions of jurisdictional boundaries with sectoral regulators, the exclusionary effects of warranty policies on parallel imports, the application of limitation periods to labour-market cartels, and the classification of statutory bodies as “enterprises”.
We discuss these developments below.
1. CCI asserts jurisdiction over the aviation sector to scrutinise IndiGo’s conduct (see here)
On 4 February, the CCI initiated a probe into IndiGo following allegations that the airline abruptly cancelled hundreds of flights in December 2025, creating a system-wide capacity shock, and subsequently charged passengers exorbitant fares for alternate flights.
Jurisdictional challenge. IndiGo raised a preliminary jurisdictional challenge, arguing that the aviation sector is comprehensively governed by the Bhartiya Vayuyan Adhiniyam, 2024 and the Aircraft Rules, 1937, placing the issue within the exclusive domain of the Directorate General of Civil Aviation (DGCA). The CCI rejected this challenge, relying on the Supreme Court’s ruling in Bharti Airtel, to hold that sectoral regulation and competition law operate in distinct but complementary domains. The DGCA itself clarified that it does not possess economic regulatory powers to conduct competition law analysis.
CCI’s preliminary assessment. The CCI’s preliminary assessment defined the relevant market as the “market for domestic air passenger transport services in India.” This is a departure from the typical practice of identifying origin-destination city pairs used to define relevant markets in aviation cases, perhaps reflecting a wider, systemic approach to the CCI’s analysis. The CCI found IndiGo to be prima facie dominant, considering its market share by number of passengers and seat capacity for the preceding two financial years, net profitability, and its extensive network coverage (prevalence across high-frequency routes and several routes where IndiGo is the only operator). The CCI determined that IndiGo’s last minute cancellations left passengers with no real choice but to seek alternate flights at significantly higher prices, which prima facie violated Section 4(2)(a)(i) of the Competition Act, 2002 (Competition Act). The CCI also found that by cancelling a significant portion of its scheduled capacity, IndiGo deliberately withheld services, creating an artificial scarcity and limiting consumer access during a peak demand period, in violation of Section 4(2)(b)(i) of the Competition Act.
The order reinforces the CCI’s view that the existence of a specialised sectoral regulator (like the DGCA) does not oust the CCI’s jurisdiction over anti-competitive conduct. The CCI’s view is actively being tested before the Supreme Court in the context of patents-related disputes and data protection issues. The CCI’s order is notable for the detailed evidence reviewed at this preliminary stage. While not unusual, the CCI is not legally obliged at this preliminary stage to seek input from opposing parties, third parties, or regulatory bodies.
2. Chipping away at parallel imports: Intel penalised for discriminatory warranty policy (see here)
On 12 February, the CCI penalised Intel Corporation (Intel) for abusing its dominant position in respect of warranty terms for boxed microprocessors (BMP), which disadvantaged parallel importers vis-a-vis Intel’s own authorised distribution network. This change was implemented in 2016 and restricted warranty services to only those BMPs purchased from an authorised Indian distributor. This meant that genuine Intel BMPs imported through parallel channels were refused local warranty service, with customers instead directed to the original country of purchase.
Relevant market and dominance. The CCI found Intel dominant in the market for “Boxed Microprocessors for Desktop PCs in India” based on its sustained high market share over a five-year period (2016-2021), as well as its considerable technological and financial resources. The CCI dismissed Intel’s argument that market share fluctuations negated its dominance, observing that its closest competitor, AMD had never surpassed Intel as the market leader during this five-year span.
Unfair and discriminatory terms. The CCI held that the India-specific warranty conditions were an unfair and discriminatory condition violating Section 4(2)(a)(i) of the Competition Act. The informant, a parallel importer, argued that parallel imports were beneficial for the Indian market by enhancing price competition between local distributors and offering a wider range of products. Parallel importers capitalized on price differences for Intel BMPs purchased in and outside India, by importing BMPs from countries where authorised distributors sell them cheaper, often at significantly lower prices (between 44-133% depending on the model) than Intel’s authorized Indian distributors. Occasionally, they also introduce models to the Indian market sooner than the authorized network. By restricting warranty services within India, Intel’s policy effectively drove up the cost of warranty services for imported BMPs (or risk repairs with less reliable third parties, with non-genuine parts) and forced parallel importers to sell at a discount. As such, Intel’s revised policy effectively rendered parallel imports unviable, by putting parallel importers at a commercial disadvantage, nudging them to purchase from authorised distributors.
Limiting choice. By rendering parallel imports unviable, the CCI noted that Intel’s policy also limited the choice of end consumers and parallel importers, forcing them to purchase BMPs from authorised Indian distributors at higher prices. The evidence showed Intel’s withdrawal of its channel supplier program and revised warranty policy to nudge independent traders to purchase from its authorised distribution channel. The warranty restriction also limited the availability of newer BMP models through parallel importers before they were introduced in the Indian market through its authorised distributors. The CCI held that this conduct amounted to an artificial restriction and limitation of the market in contravention of Section 4(2)(b)(i) of the Competition Act.
Denial of market access. Finally, the CCI concluded that this strategy structurally disadvantaged parallel importers, leading to a decline in their sales while the sales of Intel’s authorised distributors surged, thereby resulting in a targeted denial of market access in violation of Section 4(2)(c) of the Competition Act.
While the CCI has previously permitted some restrictive warranty conditions to safeguard the integrity of authorised distribution channels and ensure the servicing of only genuine products, the CCI’s review in this instance focused on the broader exclusionary impact of the warranty policy on parallel importers. The CCI ultimately viewed the use of after-sales services or warranties as a tool to ring-fence authorized distribution, thereby deeming it an exclusionary practice.
Penalty and remedies. After adjusting the 8% base penalty rate downwards to account for mitigating factors such as the withdrawal of the revised warranty policy, the CCI imposed a penalty of INR 27.38 crore. In addition, the CCI imposed behavioural remedies, directing Intel to widely publicise the withdrawal of the restrictive warranty policy to spread consumer awareness.
3. The Delhi High Court green lights CCI probe into labour-market cartel (see here)
International Flavours and Fragrances (IFF) filed a writ petition in the Delhi High Court (DHC) challenging a CCI order directing an investigation into alleged labour-related coordination (wage-fixing and no-poach agreements) among global fragrance manufacturers. IFF argued that the information was filed beyond the three-year limitation period prescribed under the Competition Act, and that the CCI erred in initiating the investigation. However, the CCI had condoned the delay, noting that the informant demonstrated “sufficient cause” by acting promptly after conducting internal investigations triggered by global dawn raids in March 2023 and the notification of the new Lesser Penalty regulations in 2024. Crucially, the CCI justified the condonation by observing that the alleged anti-competitive labour coordination may still be ongoing, thereby constituting a continuing cause of action.
The DHC concurred with the CCI’s rationale, refusing to interdict the investigation. While acknowledging IFF’s legal submissions on the strict nature of limitation rules, the DHC held that general principles of limitation may not have a direct bearing at this threshold phase, especially when the CCI as an expert regulator found strong reasons to condone the delay. The DHC also reiterated the Supreme Court’s ruling in CCI vs. SAIL that a direction to investigate under Section 26(1) of the Competition Act is merely an administrative direction, and did not warrant judicial interference, thereby allowing the cartel probe to proceed. The investigation signals the CCI’s active entry into policing labour-market cartels, aligning with global antitrust trends targeting no-poach and wage-fixing agreements.
4. Regulatory Flip-Flop: NCLAT stays CCI closure order based on its jurisdiction over statutory bodies (See here)
On 24 February, the NCLAT stayed a CCI order under Section 26(2) of the Competition Act, closing an inquiry against the Haryana Department of Town and Country Planning (DTCP) for charging External Development Charges (EDC) from real estate developers without undertaking the corresponding development work, and imposing one-sided, arbitrary and discriminatory conditions for the grant of licenses to developers to undertake real estate development.
In 2018, the CCI initiated an investigation into DTCP’s conduct, holding that DTCP was an “enterprise” within the meaning of Section 2(h) of the Competition Act. At the time, the CCI held that the levy of EDC could not be construed as a sovereign function (outside the purview of the Competition Act), since it had a “direct economic/commercial impact” on the commercial activities of developers. The CCI also granted developers interim relief against coercive collections of the EDC. DTCP then issued an order in 2019 complying with the CCI’s directions on interim relief. Relying on the government’s promise to follow these directions, the developers agreed to withdraw the case, and the CCI closed the matter in July 2022. However, in 2024, DTCP withdrew its compliance order, claiming their previous commitment was no longer in operation, since the CCI proceedings were closed.
When the informants approached the CCI again, it dismissed the information for two main reasons. First, the Punjab & Haryana High Court (affirmed by the Supreme Court) had already established developers’ obligation to pay EDC, irrespective of whether the authority undertook the external development work. The CCI refused to “reagitate” settled issues, in the interest of “judicial propriety”. Second, the CCI held that it lacked jurisdiction to consider the allegations of arbitrary and one-sided conditions for the grant of developer licenses, since these conditions were determined by DTCP in its capacity as a statutory / regulatory authority. The CCI relied on the DHC’s ruling in ICAI v. CCI (2023) that its powers do not extend to “addressing any grievance regarding arbitrary action by any statutory authority”.
The developers appealed this decision to the NCLAT, which intervened to stay the CCI’s jurisdictional findings and restrained the Haryana government from taking any “coercive steps” against the developers’ licenses, until the appeal is heard. The NCLAT observed that the CCI’s shift in legal interpretation to be a “contradictory view” required deeper scrutiny.