The Competition Commission of India (CCI) imposed penalties totalling ₹143.4 crore on HP India Sales Private Limited and its resellers for cartelisation through two separate orders concerning bid rigging in government procurement through the Government e-Marketplace (GeM). According to reports from ET Now, both proceedings related to tenders for personal computers and printing supplies, with the cases originating from lesser-penalty applications filed by HP India. In the first case, the CCI imposed a penalty of ₹126.87 crore on HP India and a combined penalty of around ₹1.22 crore on five of its resellers for indulging in anti-competitive practices in the sale and supply of personal system products. The second case resulted in a penalty of ₹11.98 crore on HP India and around ₹2.30 crore on 16 of its resellers for cartelisation in the sale and supply of printer supplies products, including toner cartridges and other consumables used with printing hardware. The regulator issued two separate orders on Monday, directing the parties to immediately cease and desist from such anti-competitive practices.
The CCI probe found that HP India played a central role in facilitating and monitoring the anti-competitive arrangements, as reported by ET Now. The antitrust watchdog noted that HP India seemed to have indulged in customer allocation when there was no e-tendering, and ensured that such allocation continued even after the introduction of e-tendering on the GeM portal. The commission observed that HP India was engaged in dictating bid prices to resellers and manipulated participation of resellers in the GeM tenders by withholding authorisation, in order to benefit itself. The commission granted HP India reductions for its disclosure and cooperation under the lesser-penalty framework, while Delphi received a separate penalty of ₹9.52 lakh. In the printer consumables case, the CCI held 16 Tier-2 resellers guilty of cartelisation, including DD Enterprises, Ascent Information, Kaypee Enterprises, Britex Enterprises, Alankar Distributors, Vijay Stationery Mart, G R Enterprises, Perfect Innovative, Khandelwal Traders, A Square Technologies, Innovative Solutions, Pioneer Technologies, Delphi Infosolutions, Shakti Marketing, International Computer Resources and Arms Peripherals.
In its second order, the CCI found that HP India and 16 resellers had manipulated tenders between 2017 and 2020 in a suo motu case of 2020 related to GeM tenders in Delhi for HP ink cartridges, toner cartridges and other printing supplies. According to ET Now, the commission imposed a penalty of ₹11.98 crore on HP India after granting it a lesser-penalty reduction, while separate penalties were imposed on participating resellers and responsible officials under Section 48 of the Act. The regulator found that the resellers had coordinated by seeking and submitting support or cover bids in government tenders, thereby distorting the competitive bidding process on the GeM platform. The 16 resellers named include DD Enterprises, Ascent Information, Kaypee Enterprises, Britex Enterprises, Alankar Distributors, Vijay Stationery Mart, and others.
The CCI noted that HP India came forward and was the first to report and file for leniency before the Commission when it had no material to form a prima facie view regarding the existence of the alleged cartel conduct. As reported by ET Now, Section 46 of the Competition Act allows the CCI to reduce or waive penalties for cartel members who voluntarily report their illegal activities, known as the leniency programme. The commission directed all contravening parties to cease anti-competitive practices, deposit penalties within 60 days, and conduct competition compliance training. Besides imposing monetary penalties on the company and the resellers, the CCI also held officials of HP India and the concerned reseller firms liable under Section 48 of the Act and imposed penalties on them. A CCI statement emphasised that such practices undermine fair competition, particularly in public procurement processes on the GeM portal.
According to ET Now, the CCI directed the contravening parties to submit compliance reports to the Commission within the same period. The regulator found that Also Read companies including Delphi Infosolutions, Digitech Computers, Orbit Techsol, Hind Technocare and Krishna Computer were also found to have contravened the Act, while Comnet Vision, Softlabs Solution, Thoughtsol Infotech, Intensity Global Technologies and M Integraph System were not found to have sufficient evidence against them. The CCI directed HP India and all the implicated resellers to cease and desist from anti-competitive conduct after finding them in violation of Sections 3(3)(d) read with Section 3(1) of the Competition Act, 2002.
