CCI by its order dated May 12, 2015, rejecting the allegations of Builders’ Association of India (Kerala Chapter) (BAI), held that the conduct of State of Kerala, Kerala Public Works Department (KPWD), Kerala State Construction Corporation (KSCC) and, Finance Department, Kerala (FDK) is not in contravention of sections 3 and section 4 of the Act i.e. anti-competitive agreement and abuse of dominance.
The CCI prima facie found merit in the case and referred it to the DG. DG found that despite exemptions and privileges it received from State of Kerala and KPWD, KSCC did not possess dominant share in the relevant market of “market for provision of services for civil construction work of Government of Kerala” so as to operate independently of the competitive forces prevailing in the relevant market or affect its competitors or consumers or the relevant market in its favor. Hence, no abuse of dominant position possible within the purview of section 4 of the Act.
Also, they are neither engaged in identical or similar trade or business to be covered under any of the provisions of section 3(3) of the Act nor the preference given to KSCC by State of Kerala and KPWD can be treated as vertical agreement in terms of section 3 (4) of the Act.
Referring and accepting the findings of the DG, CCI held that State of Kerala, KPWD and, FDK are statutory authorities and not enterprises and thus, do not come within the purview of the Act. Though KSCC was held to be an enterprise, its conduct was held to be non-abusive and not in contravention of the provisions of section 3 or 4 of the Act within the relevant market.