Uber Predatory Pricing Probe Given Green Signal by Supreme Court

Giving a green signal to the probe against Uber for predatory pricing and abuse of dominant position, the Supreme Court has refused to interfere in the order passed by the Competition Appellate Tribunal.

A bench of Justices Rohinton Nariman and Surya Kant also directed that the probe is to be completed within six months.

The court was hearing Uber India System challenging the Competition Appellate Tribunal order, issued on a plea by Meru Taxi Services, alleging that Uber is indulging in predatory pricing and misuse of its dominant position in the market.

The taxi firm had observed the data regarding Uber's pricing, according to which Uber's rides were being priced lower than they were supposed to.

Meru had said that Uber was losing Rs. 204 on every ride in respect of the every trip made by the cars of the fleet owners, which does not make any economic sense other than pointing to an intent to eliminate competition in the market.

The top court observed that Uber is abusing its dominant position and said it do not think it fit to interfere with the order made by the Competition Appellate Tribunal.

"Given the allegation made, as extracted above, it is clear that if, in fact, a loss is made for trips made, ... would prima facie be attracted inasmuch as this would certainly affect the appellant's competitors in the appellant's favour or the relevant market in its favour," the court said.

"Insofar as 'abuse' of dominant position is concerned, under Section 4(2)(a) (Competition Act), so long as this dominant position, whether directly or indirectly, imposes an unfair price in purchase or sale including predatory price of services, abuse of dominant position also gets attracted. Explanation (b) which defines 'predatory price' means sale of services at a price which is below cost," it added.