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2013 (5) TMI 8 - Commission - Companies LawUnfair trade practice - Application is filed u/s 19(1)(a) of the Competition Act, 2002 – Franchisee agreement – territorial exclusivity to the informant for a period of 3 years. - As per information a dispute arose between the informant and the OP when the informant came to know that the OP had initiated process of setting up its own Company-Run and Company-Operated (COCO) Saloon in breach of the territorial exclusivity given under the agreement. The informant initiated arbitration proceedings against the OP. During pendency of the arbitration proceedings the OP terminated the franchisee agreement. The informant has alleged that the action of OP to set up COCO Saloon in contravention to the terms of the agreement was an unfair trade practice and an abuse of its dominant position under the Franchisee Agreement. Thus, as per the informant the acts and conduct of the OP were in contravention of the provisions of sections 3 and 4 of the Act. Held that – It is necessary to consider as to what will be the relevant market in this case and in this case would be the market of beauty and wellness services exclusive for women through saloon in the territory of Gurgaon as well as Delhi. The next issue to be considered is about dominance of OP in the relevant market. There are very few corporations in this market and these corporations cater to the need of only small category of customers and their presence is only by way of few saloons. One can find beauty saloons/parlours almost in every street/mohalla of Delhi. Some examples of such saloons and parlours running in Delhi and Gurgoan are Trends Beauty Point, Cure & Curve, Radiance, Shreyas Shanhnaz Husian Signature Salon etc. Many of these beauty saloons are one person show and many have employed several women beauticians to cater to the needs of their clients. Thus the question of abuse of dominance by Lakme would not arise. In view of the above discussion, there does not exist a prima facie case for investigation by the Commission. It is a fit case for closure under section 26(2) and is hereby closed.
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