CCI dismisses unfair business practices complaint against Vatika, CREDAI


The Competition Commission dismissed a complaint against the real estate developer Vatika and realtors' body CREDAI for unfair business practices in the matter of development and sale of residential plots in Gurugram. The regulator disposed of the matter as it did not find any infringement of the sections pertaining to abuse of dominant market position and anti-competitive agreements by Vatika and CREDAI, according to a CCI order. 


The complaint was filed by a New Delhi-based individual who had alleged that Vatika had abused its dominant market position by imposing unfair terms and conditions in the buyer's agreement and demanding instalment money without performing its own contractual obligations. 


Further, the individual alleged cartelisation by the Confederation of Real Estate Developers' Associations of India (CREDAI) and its members, including Vatika, thereby contravening anti-competitive agreements. 


For the case, the Competition Commission of India (CCI) considered the 'market for the provision of services for development and sale of residential plots in Gurugram' as relevant one. 


In the case of Vatika, CCI noted that the real estate developer faces sufficient competitive constraints from various other competitors and would not be able to operate independently of the competitive forces prevailing in the relevant market, therefore Vatika is not in a dominant position, CCI said in a 10-page order dated October 16. 


With regard to the allegation of forming cartel by CREDAI and its members, CREDAI submitted a report to the regulator that its members were informed of competition issues in relation to real estate sector and awareness was created among them regarding non-compliance and violation of the provisions of the Competition Act. 


The Competition Commission noted from the report that "efforts are being made by CREDAI to not repeat the issues that had come before" the regulator. 


Hence, the allegation of CREDAI forming cartel with its members has no merit in the present case, CCI said. Accordingly, CCI closed the matter after finding no violation of Competition Act.

Written by The Realty Paper

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