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CCI Orders Detailed Probe Against MakeMyTrip, OYO for Unfair Business Practices

Image for representation (Image: Reuters)

Image for representation (Image: Reuters)

The CCI ordered the investigation after Treebo and its partner hotels alleged that both companies were stifling competition by resorting to anti-competitive business operations.

New Delhi: The Competition Commission of India (CCI) on Monday ordered a detailed investigation against MakeMyTrip and OYO for allegedly indulging in anti-competitive business practices.

While ordering the probe, CCI also noted that a case against MMT and OYO for entering into a vertical arrangement having an appreciable adverse effect on competition (AAEC) in the market is also "prima facie" made out.

"The commission is of the view that prima facie a case of contravention against MMT for abuse of dominant position... is made out on account of all the three allegations analysed supra," the CCI said.

The order came on a complaint filed by Rubtub Solutions Pvt Ltd, which operates under the brand name of Treebo Hotels in India and is in the business of providing franchising services to budget hotels.

As per the complaint, Treebo and its partner hotels are being excluded from listing on MMT's platform through abrupt termination pursuant to the commercial arrangement between MMT and OYO.

Besides, MMT is alleged to have imposed "price parity restriction" on Treebo partner hotels through the chain agreement, which restricted it from providing its properties to Booking.com and Paytm at a better price.

Additionally, MMT allegedly imposed an "exclusivity condition" on Treebo through exclusivity agreement which restricted it from listing its properties on Booking.com and Paytm for 72 hours and 30 days prior to check-in for hotels situated in category A and category B cities, respectively.

The complainant said that OYO has abused its dominant position in the market of franchising services for budget hotels in India by entering into an anti-competitive vertical arrangement with MMT, which is a dominant online travel agency (OTA), thereby denying market access to it.

Accordingly, the Commission on "prima facie" finding the contravention of relevant provisions of Competition Act, directed DG, its investigation arm to conduct a detailed probe.

first published:February 24, 2020, 20:38 IST