Competition Commission of India fines HP for forming a cartel and increasing prices
Key Points
- The Competition Commission of India fined HP 14.4 million dollars due to cartel activities.
- The Commission accessed WhatsApp records proving bid-rigging and price-fixing between 2017 and 2020.
- HP was reported to have supported price agreements among dealers to prevent counterfeit cartridge sales.
- The regulatory commission mandated the company and dealers to cease all such activities.
By the Numbers
The Competition Commission of India (CCI) imposed a penalty of 138.85 crore rupees (approximately 14.4 million dollars) on HP Inc. and some of its dealers for inflating computer and printer prices. The Commission concluded that the company restricted competition by determining prices in government tenders and preventing some dealers from bidding.
The regulatory body's order stated that WhatsApp records were accessed showing price-fixing and bid-rigging practices between HP employees and dealers between 2017 and 2020. It was determined that the company supported this collaborative agreement in order to prevent the sale of counterfeit ink cartridges and maintain its competitive edge against other manufacturers.
In addition, it emerged that HP manipulated the reverse auction process used in computer sales and predetermined which dealer would sell to which customer. The CCI ordered the company and its relevant dealers to immediately cease all such activities.
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Frequently Asked Questions
- Why and how much was HP fined?
- HP was accused of forming a cartel by making secret agreements with its dealers to inflate computer and printer prices in Indian government tenders. The company was fined approximately 14.4 million dollars (138.85 crore rupees).
- Why did HP resort to these price agreements?
- It was reported that the company resorted to this method to maintain the competitive edge of its own products and to prevent dealers under cost pressure from shifting to selling cheaper counterfeit ink and toner.
- What evidence emerged during the Commission's investigation?
- The accessed WhatsApp records proved that HP employees and dealers colluded on issues such as fake bidding and price-fixing between 2017 and 2020.
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