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Ola, Uber to Come Under the Scan of CCI for Surge Price

The officials of Ministry of Corporate Affairs have stated that they are planning to conduct a study on the surge pricing by the cab aggregators. The competition is very serious between the cab aggregators and government has felt that two major operators in this industry- Ola and Uber might be abusing their dominant position.
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The Competition Commission of India (CCI) is all set to bring under its scanner the cab aggregators Ola and Uber for surge pricing after investigating the alleged unfair practices by the pharmaceutical companies and private healthcare providers.
Ola and Uber initiated surge pricing in their apps for meeting the demand of riders for taxis at any given time by adjusting the price of the ride.

The officials of Ministry of Corporate Affairs have stated that they are planning to conduct a study on the surge pricing by the cab aggregators. The competition is very serious between the cab aggregators and the government has felt that two major operators in this industry- Ola and Uber might be abusing their dominant position.

The Competition lawyers have said that the CCI has been looking for the competition practices in the industry which directly relates to the common man and after health and cab aggregators the focus will shift to hotel industry.

The rival cab aggregators are filing the complaints with CCI against Ola and Uber. In one of such complaint, Meru has alleged that both Ola and Uber are bringing foreign investors for disrupting the market. Earlier a complaint by Meru was rejected by the CCI. The complaints by NGOs have also been filed against the surge pricing.

In connection with the surge pricing, a committee has earlier been set up by the Maharashtra Government to recommend the prices to these cab aggregators. 15 percent reduction in the basic fare between 8.1 km to 12 km and further reduction of 20 percent in distance beyond that has been suggested by the committee.

The CCI through its study on health care providers found out that Max hospital is having 500 percent margin on items like syringe.

CCI is conducting these studies to have an in-depth knowledge of the problem before coming to any conclusion. Earlier, the order of the commission has been overturned due to the fact that the principle of natural justice has not been followed and in certain cases, there is lack of evidence to show that the Competition Act is being contravened.
Vidhi report has suggested that to protect the orders of CCI from being quashed by the appellate bodies it is necessary that CCI should follow the procedure of natural justice.

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Reviewed by:
Mehak Sharma
Published on 5th Jan, 2018
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