Competition Comm orders probe against MakeMyTrip-GoIbibo, OYO

New Delhi: Fair trade watchdog CCI has ordered an investigation against online travel agents MakeMyTrip-GoIbibo and hospitality services provider OYO after finding that prima-facie they have violated competition norms.

For the case, the Competition Commission of India (CCI) assessed the allegations on the basis of two relevant markets. In the case of MakeMyTrip-GoIbibo (MMT-Go), it is the 'market for online intermediation services for booking of hotels in India', and for OYO, it is the 'market for franchising services for budget hotels in India'.

MakeMyTrip has acquired GoIbibo. Following a complaint from the Federation of Hotel & Restaurant Associations of India (FHRAI), the watchdog looked into various aspects of their businesses and concluded that "prima-facie" there are violations of competition law.

The commission said that MMT-Go prima-facie appears to be a dominant player in the relevant market.

"... prima-facie OYO is not found to hold a dominant position, despite being a significant player in the market for franchising services for budget hotels in India'," it noted.

According to the watchdog, delineation of relevant market is based on market realities as they exist at the time of assessment and that in rapidly changing markets in particular, market assessment cannot have a static approach.

In a 26-page order, the fair trade regulator said there exists a prima-facie case for investigation against MMT-Go and OYO for alleged violation of the provisions of Section 3(4) of the Competition Act. This section pertains to anti-competitive agreements.

"Further, a prima-facie case for investigation under Section 4 of the Act is made out against MMT-Go," it added. Section 4 relates to abuse of dominant position.