Like Us? Spread the word!

Copyright © 2018 Talking Competition All Rights Reserved


“high-end” residential accommodation. In making the classification the CCI utilized the “Small but significant and non transitory rise in price test” (SSNIP test). Understandably, a buyer intending to purchase a low-end flat shall not buy a villa or a high-end apartment costing upwards of Rs. 2-3 Crores for a 5-10% increase in the price of the low end apartment and vice-versa.

However, it appears that the CCI has done away with this distinction lately. Currently, the CCI defines the market in real estate cases as a broad market for residential apartments/units/plots without making further divisions.[10] Even the current investigations against DLF Group in Gurgaon are being conducted in the broad segment of “residential apartments” without any narrowing down into separate segments.[11]

With regard to the relevant geographic market, the CCI has been considering the geographical limits of a city as the distinct area within which the market power needs to be assessed i.e Gurgaon and Delhi have been considered as forming separate geographic markets. The rationale is based on the unique geographic characteristics possessed by a region and preferences of the consumer. For instance, a home-buyer who works in a specific city shall not purchase an apartment in a different city to avoid the hassle and trouble of travelling. That being said, in George Kuruvilla’s case,[12] the CCI did appear to consider sub-urban Chennai as the relevant geographic market.

It should be noted that the CCI is not currently considering purchase for investment purposes as the relevant factor for defining geographical markets. Such approach has been endorsed by the Appellate Tribunal also.[13] If considered, it will surely broaden the geographical markets. Moreover, there have been consistent attempts in the minority orders of CCI to apply the concept of “locked-in customer” and aftermarket abuse to the real estate sector.[14] However, this contention has not had many takers within the CCI.


In possibly the most celebrated order of CCI till date, DLF Group has been found dominant in the "market for services of developer/builder in respect of high-end residential accommodation in Gurgaon" and has been penalized for abusing its dominant position.[9] The CCI in this case held that the market for residential apartments can be further divided into three categories- low-end, mid-end and high-end- each constituting distinct product markets.

Elaborating further, the CCI classified an apartment costing Rs 2-2.5 crores as “high-end”. Additional facilities provided by the developer like schools, shops, club, recreational facilities etc within the complex were also considered as characteristics of a

The concept of relevant market plays a central and often critical role in the application of competition law. In antitrust, market definition provides a perimeter within which the effects of anti-competitive conduct are analysed. It helps in the identification of those substitutable products or services which provide an effective constraint on the anti-competitive behaviour of the entity/entities under investigation.

Relevant markets have been defined historically, by virtue of interest, narrowly by parties alleging anti-competitive conduct and widely by the parties accused of anti-competitive conduct. More often than not, the outcome of an anti-trust litigation hinges on which party presents a more convincing case for the definition of the relevant market. Needless to say, defining the relevant market is a crucial aspect of antitrust litigations.

[19 Feb 2015]  [Anand Sree & Danish Khan]

In the first of our first multi-volume article, we analyze the decisions of the CCI for its outlook on relevant market in the real estate sector

Relevance of the Relevant Market: The Indian Experience

Defining the relevant market involves a detailed study of the intricacies of an industry or field in question. Competitive constraints like demand-side substitutability, supply-side substitutability and potential competition needs to carefully analyzed to arrive at an informed opinion.[1] Further, considering the fact that even for the same focal product, relevant market can be defined differently depending on the specific nature of the end use,[2] defining the relevant market can be a tricky proposition.

However, as opposed to mature competition law jurisdictions, the Competition Commission of India (CCI) does not necessarily define the relevant market while examining conduct under Section 3 of the Competition Act, 2002 (Act).[3] The European Commission(EC), on the other hand, is under an obligation in certain cases to define the relevant market even for cartel-like conduct.[4]

Similarly, the EC’s Guidelines on Vertical Restraints provide for the definition of relevant market and market shares thereof, preceding the applicability of block exemptions.[5] In India however, the CCI has not been defining the relevant markets while analyzing the anti-competitive effects of vertical agreements.

Keeping in mind the significance of the relevant market for competitive analysis, the TalkComp team discusses the development of the concept of relevant market by providing a sector-wise outlook of the CCI on the relevant market. This is the first instalment of the multi-volume analysis.

                                                            VOLUME I:  RELEVANT MARKETS IN REAL ESTATE

The real estate sector in India has the dubious distinction of attracting the vast majority of allegations pertaining to anti-competitive conduct. Most of the matters relate to buyers alleging abuse of dominance by developers through one-sided and arbitrary clauses in the apartment-buyer agreements. Needless to say, the overwhelming majority of the cases have been dismissed at the prima-facie stage due to the respective builders’ not being in a dominant position in the relevant market.

Broadly speaking, the relevant product markets for the provision of real estate services can be classified into residential plots/flats,[6] commercial,[7] and industrial properties, being not-substitutable with each other.[8]


Subscribe to TalkComp!

© 2015 Talking Competition. All rights reserved.Disclaimer-The thoughts and opinions mentioned in the present article are those of the Talking Competition Team. The present opinion should not be construed as legal advice. For more information, please contact Anand Sree at [] or Danish Khan []. The present article is protected by Copyright Law(s).


[1] Commission Notice on the definition of relevant market for the purposes of Community Competition Law (97/C 372/03), Para 17.

[2] Hoffmann-La Roche & Co AG v. Commission, [1979] ECR 461, Para 28.

[3] See Case No 1 of 2009 FICCI-Muliplex Association of India v. United Producers/Distributors Forum & Ors, Para. 23.9; Case No. 20/2011 Santuka Associates Pvt. Ltd. vs All India Organisation of Chemists and Druggists & Ors., Para 28.24.

[4] Case T-213/00 CMA CGM and Others v Commission (FETTCSA) [2003] ECR II-913, Para 206.

[5] Guidelines on Vertical Restraints, (2010) OJ C130/10, Para 88

[6] CCI Case No. 77 of 2014 Shri Ankit Jain vs BPTP Ltd. & Anr.

[7] CCI Case No. 77 of 2011 Eastman Cast & Forge Ltd. vs Exact Developers & Promoters Ltd. & Anr.

[8] CCI Case No. 43 of 2012 Shri A.K Jain, Gurgaon, Haryana v. The Dwarkadhis Projects Pvt. Ltd, Delhi

[9] CCI Case No 19 of 2010 Belaire Owners’ Association v. DLF Limited, HUDA & Ors

[10] CCI Case No. 51 of 2014 Shri Kirat Singh v. M/s Orchid Infrastructure Developers Pvt. Ltd & Ors.; CCI Case No. 40 of 2014 Deepak Kumar Jain vs M/s TDI Infrastructure Limited & Ors.; CCI Case No. 11 of 2014 Mr. Dalip Singh Arshi vs. M/s Aerens Jai Realty Pvt. Ltd. & Ors.

[11] CCI Case No. 1 of 2014 Mr. Ashutosh Bhardwaj v. M/s DLF  Limited & Ors.

[12] CCI Case 67 of 2011 Mr. George Kuruvilla vs Hiranandani Palace Gardens Pvt. Ltd.

[13] CompAT Appeal No. 20 of 2011 M/s DLF Limited vs Competition Commission of India & Ors., Para 84

[14] Minority Order in CCI Case No. 83 of 2011 Praveen Kumar Sodhi vs Omaxe Ltd & Ors.; Minority Order in CCI Case No. 18 of 2010 DLF Park Place Residence Welfare Association vs DLF Ltd.