CCI: Exclusivity Granted To Kerala State Road Transport Corporation By Kerala Government In Public Interest Is Not Anti-Competitive

The CCI held that the exclusivity granted to OP by the Kerala Government for operations in public interest cannot be said to be anti-competitive under the Act.

Brief Facts:

Informant is an advocate and OP is an autonomous corporation established by the Kerala Government to operate buses within and outside Kerala. The Kerala Government approved a scheme to provide efficient, adequate, economical, and properly coordinated passenger road transport service on about 31 routes all over Kerala to be run exclusively by OP.

The Nilakkal-Pamba route being used by Sabarimala temple pilgrims falls under the scheme and the parking facility at Nilakkal is also included and no other carriages are permitted. OP during the main season from November to January provides additional bus services from various depots in Kerala, as part of special services serving around 1.5 to 2.5 lakh pilgrims.

The Informant contended OP charges higher fares above the standard rates from these pilgrims. The travel distance is 18km, however, OP charges fare for about 22km. Further, no contract vehicles are allowed to drop their passengers at Pamba since they are not permitted to go beyond Nilakkal. Thus, the pilgrims are purely dependent on OP's bus services and post their visit to the temple have to avail the OP's service to go back to Nilakkal.

The Informant argues that OP is in a dominant position contravening the provisions of Section 4 of the Act.

Observations of the Commission:

The CCI closed the case and held that exclusivity granted to OP by Kerala Government for operations in public interest cannot be said to be anti-competitive under the Act.

The Commission pointed out the Kerala Government has exclusively granted operations to OP on certain routes under the provisions of the Motor Vehicles Act, 1988 to provide adequate, economical and properly coordinated passenger road transport service in the public interest. The exclusivity to OP is a policy decision of the Kerala Government and cannot be considered to be anti-competitive.

CCI noted that concerning excessive fares, the OP has fixed the fares as per the governmental notification and the said notification applies to both nationalized and non-nationalized routes and has provisions for enhancement of the rate of fares for: (a) Ghat roads and; (b) during the festival occasions as mentioned in the schedule appended to the said notification. Moreover, the fares on a per-kilometer basis are being charged on a uniform basis as per the said notification by both public and private operators.

In conclusion, no competition concern can be discerned and thus, no need to delve into the allegations of abuse of the dominant position. Thus, no case of contravention of Section 4 of the Act is made out.

Case Title: In Re: Mr. Shine P. Sasidhar, Advocate and Kerala State Road Transport Corporation

Case No.: Case No. 38 of 2022

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