DLF is not in dominant position in Delhi, no prima facia case of abuse arise

Competition Commission of India:  In a sigh of relief to DLF, a building giant already facing fair play litigations, the market competition regulator CCI closed a case alleging abuse of dominant position. The informants in the present case alleged that DLF compelled them to enter into one-sided and unfair Apartment Buyers’ Agreement and made them pay an unreasonable penal interest @ 18% p.a. for delay in making payments.

Considering the facts of the present case, CCI declared the market of ‘provision of services relating to development and sale of residential apartment in Delhi’ as the relevant market in the case. The Commission further noted that in the geographic region of Delhi, DLF is just one of the real estate developers engaged in the provision of services relating to development and sale of residential apartment. There are many other real estate developers operating in Delhi who are engaged in the provision of services relating to the development and sale of similar residential dwelling units. Some of such developers include Delhi Development Authority, Ansal API, Umang Realtech, Emaar Group, CGHS Group, Parsvnath, etc. These developers appear to pose competitive constraints to DLF in the relevant market. Also, presence of these real estate developers in the relevant market indicates that the Informants were not dependent upon DLF for purchasing residential apartments.

The Commission was of the opinion that DLF prima facie does not appear to be dominant in the relevant market defined. Since DLF is not in a dominant position, the question of its conduct being abusive could not arise. Accordingly, no prima facie case of contravention of the provisions of section 4 of the Competition Act, 2002 appeared against DLF and the matter stands closed under the provisions of section 26(2) of the Act. Ess Cee Securities Pvt. Ltd. v. DLF Universal Limited, 2015 CCI 22, decided on 26.08.2015

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