Rudrakshi Sharma & Sahaj Joshi, Symbiosis Law School, NOIDA, Symbiosis International Deemed University, Pune
Decided on: December 15, 2020
Coram: Hon’ble Mr. Justice Rohinton Fali Narian
Hon’ble Mr. Justice K. M. Joseph
Hon’ble Mr. Justice Krishna Murari
Equivalent Citation: AIR 2021 SC 199
Background of the Case
The present matter was appeal arisen from an information filed by an independent legal practitioner (as claimed) on august 13, 2018, seeking an inquiry by the Competition Commission of India (CCI) into the alleged anti-competitive practices of ANI Technologies Pvt. Ltd. (OLA and Uber India Systems Pvt. Ltd. among others. As per the informant’s contention that the companies are engaged in price-fixing agreements which violates the Section 3(4)(e)2 of the Competition Commission Act, 2002 [further referred as “the act”]. The Informant also provided that the Ola and Uber operate as platforms for radio taxi services via mobile applications, which helps the interaction between riders and drivers. Fare calculations on these platforms are determined by algorithms that consider various factors, with the apps also enabling multiple payment methods for users.
It is alleged that the algorithmic pricing employed by Ola and Uber deprives both riders and drivers of the freedom to negotiate fares. Riders are unable to negotiate with individual drivers for rides booked through the apps, and the drivers are not allowed to offer any discounts, as they are bound to accept the price set by the pricing algorithm as per their terms of agreement with the cab aggregators. The working of the app pays the drivers a share of that price after reducing their commission. The argument presented by the informant is that the pricing algorithm artificially manipulates supply and demand, ensuring higher fares for drivers who would otherwise compete against each other, it is further submitted that OLA and Uber have greater bargaining power than riders in determining prices which provides them the opportunity to implement price discrimination based on rider’s willingness to pay, leading to artificially inflated fares. The informant also made averments regarding resale price maintenance, alleging a contravention of Section 3(4)(e) of the act.
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