CCI Orders Probe Against Asian Paints Over Abuse of Market Dominance

Grasim’s complaint alleges that Asian Paints has been engaging in exclusionary conduct aimed at preventing new players, particularly itself, from gaining a foothold in the decorative paints space

The commission also flagged Asian Paints’ alleged efforts to limit access to key raw materials and logistics support for competitors

Source : IndiaMART

The Competition Commission of India (CCI) has ordered a detailed investigation into Asian Paints for allegedly abusing its dominant position in the decorative paints market. The probe stems from a complaint filed by Grasim Industries, a part of the Aditya Birla Group, which entered the segment last year with its 'Birla Opus Paints' brand.

In its order issued on Tuesday, the anti-trust watchdog noted a prima facie case of violation under multiple provisions of Section 4 of the Competition Act, 2002 — specifically 4(2)(a)(i), 4(2)(c), and 4(2)(d) — which deal with abuse of dominant market position.

Exclusive Dealer Practices Under Scrutiny

Grasim’s complaint alleges that Asian Paints has been engaging in exclusionary conduct aimed at preventing new players, particularly itself, from gaining a foothold in the decorative paints space. According to the CCI, there appears to be evidence that Asian Paints imposed unfair conditions by pressuring its dealers not to stock or promote rival brands, thereby enforcing exclusivity arrangements. “Such conduct appears exploitative and is likely to distort competition,” the CCI observed.

Supply Chain Pressure And Market Access Barriers

The commission also flagged Asian Paints’ alleged efforts to limit access to key raw materials and logistics support for competitors. The company is accused of pressuring suppliers, landlords, clearing and forwarding (C&F) agents, and transporters to withhold services from rivals like Grasim. These actions, the CCI said, may create artificial barriers to entry and lead to partial foreclosure of the market.

“This kind of behaviour, if proven, could significantly hinder competition and restrict consumer choice,” the commission added.

Investigation Timeline

The Director General has been tasked with conducting the investigation and submitting a report within 90 days. The commission clarified that its current observations are not a conclusive verdict on the matter, and the DG must carry out the inquiry independently, uninfluenced by the preliminary findings.