Deal Street

July 02, 2019

C&M acts for Bentley Systems in defending complaint before the CCI


Chandhiok-&-Mahajan

Competition Commission of India (CCI) dismissed allegations of abuse of dominance by Bentley Systems India Private Limited (Bentley Systems), a subsidiary of the U.S. headquartered, Bentley Systems Incorporated on July 02, 2019. The CCI further dismissed allegations of horizontal and vertical restraints imposed by Bentley Systems on the informant, SOWiL Limited (SOWiL).

SOWiL alleged that Bentley Systems had forced them to renew the annual maintenance contract for the CAD software licenses held by it, taking undue advantage of their dominant market share of 80% and thus abused its position under Section 4 of the Competition Act, 2002 (Competition Act). SOWiL further alleged that Bentley Systems imposed horizontal and vertical restraints under Section 3(3) and 3(4) of the Competition Act respectively.

On receipt of the information, the CCI directed Bentley Systems to respond to the allegations. A response was filed by Chandhiok & Mahajan, on behalf of Bentley Systems.

The CCI rejected SOWiL’s allegation of horizontal restraints by observing that Bentley Systems and SOWiL do not operate at the same business level or carry on similar trade or economic activity. While deciding on the allegations of vertical restraints, CCI noted that SOWiL was a consumer of the CAD software of Bentley Systems, purchasing the same for its own use. Thus no vertical arrangement existed between SOWiL and Bentley Systems under the Competition Act.

Noting that CAD software has different applications which are used in different fields, CCI determined the relevant product market to be “supply of CAD software services in civil engineering works”. As the price and condition of competition were homogenous across in India, the relevant geographic market was held to be “India”.

CCI then observed the highly competitive and fragmented nature of the relevant market does not put Bentley Systems in a position to operate independent of the competitive forces or affect the competitors or consumers in its favour. As Bentley Systems was not dominant in the relevant market, allegations of abuse of dominance did not merit examination and the CCI closed the matter under Section 26(2) of the Competition Act.

Bentley Systems was represented by Mr. Vikram Sobti (Partner), Mr. Mehul Parti (Senior Associate) and Mr. Salman Qureshi (Associate) of Chandhiok & Mahajan.

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