New Delhi: The Competition Commission of India (CCI) today imposed a Rs 27.38 crore penalty on Intel Corporation over its India-specific Intel warranty policy for boxed microprocessors.
The Commission passed the order under Section 27 of the Competition Act, 2002. It held that Intel violated provisions of Section 4 of the Act relating to abuse of dominant position.
The case arose from information filed by Matrix Info Systems Private Limited under Section 19(1)(a) of the Act. The informant alleged that Intel amended its Intel warranty policy from April 25, 2016. Under the revised policy, Intel accepted warranty claims in India only for boxed microprocessors purchased from authorised Indian distributors.
As a result, Intel declined warranty claims for products bought from its authorised distributors in other countries. Instead, it directed customers to seek warranty service in the country of purchase.
CCI finds Intel warranty policy discriminatory
After examining the evidence, the CCI held that Intel was dominant in the relevant market for boxed microprocessors for desktops in India. It found the Intel warranty policy discriminatory when compared with Intel’s policies in China, Australia and other regions.
The Commission said the policy limited consumer choice and affected parallel importers. Consequently, it caused an appreciable adverse effect on competition and Indian consumers.
The CCI noted that the policy remained in force for eight years. It initially calculated the penalty at 8% of Intel’s average relevant turnover. However, it reduced the amount after considering mitigating factors, including withdrawal of the policy from April 1, 2024.
Accordingly, the Commission imposed a final penalty of Rs 27.38 crore on Intel. It also directed the company to widely publicise the withdrawal of the impugned policy and submit a compliance report.
The order was passed in Case No. 05 of 2019 and has been uploaded on the CCI website.
