Thursday, 9 August 2012

PAYING HIGHER RATED FOR BOTTLED WATER/DRINKS AT MALLS OR MULTIPLEXES?

Some useful info:


You cannot be charged a higher rate for bottled water/soft drinks at Malls/Multiplexes



Consumers are completely dependent on the relevant products offered  within multiplexes. These customers are practically "locked-in" customers as they cannot go outside the premises because of security reasons.

The Cine-goers are going to watch the movie in the Multiplexes for entertainment and if they are spending 200-300 rupees on getting cinema tickets they won’t mind spending 30-40 rupees on soft drinks or bottled water. This is the reason why these multiplexes in connivance with the manufacturers of the soft drinks and bottled water try to extract maximum profit out of the customer’s entertainment spree.
Competition Commission of India (CCI) has directed to immediately stop from charging discriminatory prices from the customers.

Hindustan Coca Cola Beverages Private Limited, (hereinafter referred to as HCCBPL) has been alleged in the complaints to CCI that HCCBPL has been impudently indulging in blatant restrictive and unfair trade practices contrary to the explicit provisions in MRTP Act, 1969 and Consumer Protection Act, 1986. The complainant alleged that the said company has entered into an understanding with INOX Leisure Private Limited (hereinafter referred to as ILL).

In pursuance of the said agreement, HCCBPL has been supplying some of its products which include, inter- alia, the packaged drinking water and soft drinks at an inflated and exorbitant price and in sharp variance with ordinary price of these products in any prevailing market and thereby the company is wantonly enforcing two pricing for the same products of same quality, quantity, standard and package.

The complainant has further alleged that HCCBPL has been supplying 500 ml water bottles and 400 ml orange pulp soft drinks at a M.R.P. of Rs.20/- and Rs.40/- respectively, though these products are available in any prevailing market at Rs.10/- and 25/- respectively. 

In pursuance of the agreement, HCCBPL has been supplying beverages at an inflated and exorbitant price in comparison to the price of these products in the ordinary market. Therefore, HCCBPL is enforcing two different prices for the identical products. Such an agreement between HCCBPL and ILL is anti-competitive as ILL is selling products of HCCBPL only no choice to the consumer is available inside the multiplex and theatres.

The Cine-goers are going to watch the movie in the Multiplexes for entertainment and if they are spending 200-300 rupees on getting cinema tickets they won’t mind spending 30-40 rupees on soft drinks or bottled water. This is the reason why these multiplexes in connivance with the manufacturers of the soft drinks and bottled water try to extract maximum profit out of the customer’s entertainment spree. Simply because of the fact that the Cine-goers can afford paying 30-40 rupees on Bottled water/Soft drinks, that doesn’t mean that their choice can be restricted.

The CCI passed it's judgement as follows:

  • M/s Inox Leisure Limited and M/s Hindustan Coca Cola Beverages Pvt. Ltd are directed to immediately stop from charging discriminatory prices from the customers.
  • The discriminatory conditions mentioned in the agreement dated 10.06.2008 and any other subsequent agreement to this effect be changed immediately to allow other competitors of the same product within the premises of multiplex owned by ILL.
  • A penalty of 5% of the average of the turnover for the last three preceding financial years is imposed upon M/s ILL and HCCBPL for deliberately entering into exclusive supply agreement to foreclose the competition and driving the competitors out of the market.
Download the full order of CCI from here:


Consequent to this decision, Malls/Multiplexes are now serving "fountain sodas" - which do not have an MRP.

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