HP fined Rs 138 crore by CCI for manipulating government tenders

The Competition Commission of India (CCI) has levied a cumulative penalty of Rs 138.85 crore (approximately $1.66 million USD) on HP India Sales Pvt. Ltd. The authority found that the company colluded with its authorized resellers to manipulate government procurement processes conducted through the Government e-Marketplace (GeM).

In two separate orders, the CCI concluded that HP rigged tenders involving personal systems products and printer supplies. The manipulation involved controlling reseller participation, selectively issuing Manufacturer Authorisation Forms (MAFs), facilitating cover bids, and coordinating bid prices. A penalty of Rs 126.87 crore was imposed in the personal systems case, and Rs 11.98 crore in the printer supplies case.

The investigation, which stemmed from a lesser penalty application by HP, revealed evidence of collusion in multiple tenders. According to CCI findings, HP officials communicated bid prices to resellers and instructed them on pricing strategies. The company also restricted the issuance of MAFs, ensuring only selected resellers could participate in specific tenders.

Furthermore, the CCI found that HP directed resellers to submit support or cover bids while monitoring competitors' pricing. The commission rejected HP's defense of a purely vertical relationship, stating that HP and its resellers acted as competitors in these GeM tenders. Similar coordination was found to have preserved specific reseller accounts after the shift to GeM procurement.