September 12, 2011

COMPETITION REGULATOR DOES REALITY CHECK ON REALTY DEVELOPER

The Competition Commission of India (“CCI”) in the case of Belaire Owner’s Association (“Informant”) vs.  DLF Limited & Ors. (“Opposite Parties”) pronounced DLF Limited (“DLF”) guilty for grossly abusing its dominant market position in the concerned relevant market and imposing unfair conditions in the sale of flats/apartments to home buyers/consumers in contravention of the provisions of the Competition Act, 2002 (“Act”). The CCI imposed a penalty of INR 6.3 billion (USD 140 million), at the rate of 7% of the average turnover of DLF for the last three financial years and issued a 'cease and desist' order against DLF from imposing such unfair conditions in its agreements with buyers for residential buildings to be constructed in Gurgaon.

This judgment is especially relevant in light of the CCI issuing a similar ‘cease and desist order’ dated August 29, 2011 against DLF for its Park Plaza project in Gurgaon, on grounds of imposing unfair conditions on buyers.

Please find attached our detailed hotline on the CCI order passed in the above matter.

This hotline can be best viewed in Adobe Acrobat version 7.

Team Competition Law,

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