Citing regulations that there should not be any restrictions on supply of spare parts, the Competition Appellate Tribunal (COMPAT) on Friday has stated that three automakers – Ford India Pvt. Ltd, Nissan Motor India Pvt. Ltd and Toyota Kirloskar Motor Pvt. Ltd are guilty of such practices. A fine has been imposed on these three automakers that are guilty of anti competitive conduct in the spare parts market.
The ruling states that there should be no restrictions on the supply of spare parts, however, it was found that these three automakers have denied independent workshops access to their original spare parts thus restricting the functions of third party workshops. Following these revelations, COMPAT has imposed a 2% fine on company’s annual average turnover from spare parts for a period of 3 years preceding the year of inquiry which was initiated in 2011.
This penalty differs from that imposed by CCI which amounts to 2% of automakers average annual turnover for the 3 years which amounts to INR 93.38 crores for Toyota, INR 1.62 crores for Nissan and INR 39.78 crores for Ford. CCI stated that the investigation included 14 companies including these three automakers.
This new judgment would aid in better transparency in terms of spare parts while customers will have easier access along with a certain level of fairness. Toyota, Nissan and Ford have also been found guilty of entering into agreements which led to restrictions on third party workshops. All three automakers have however, denied independent workshop access to spare parts.
Toyota has confirmed that its lawyers are working on getting a complete copy of the order to study these allegations and gain understanding of its impact following which the next course of action would be determined while Nissan and Ford are yet to responded to these allegations.