On December 03, 2021, CCI passed an order under Section 26(6) of the Act, dismissing the allegations of abuse of dominant position against Intel Corporation (‘Intel’).^[1]

The information was filed by Velankani Electronics Private Limited (‘Informant’) against Intel alleging, inter alia, contravention of the provisions of Section 4(1) read with Sections 4(2)(b), 4(2)(c) and 4(2)(e) of the Act. The Informant is engaged in designing and manufacturing electronic products in India, including servers. The opposite party, Intel, is a technology company that is engaged, inter alia, in manufacturing semiconductor chips (i.e., microprocessors).

The Informant sought to design its own server board to have a competitive edge in the market. For the server boards designed and manufactured by the Informant to work, it would need to interface with the microprocessors of manufacturers such as Intel. The Informant sought access to certain reference design files and simulation files from Intel that can be incorporated into the server board and can ensure its interface compatibility with the microprocessor. Intel allegedly refused to furnish its complete reference design files and simulation files to the Informant, while it provided these files to original equipment manufacturers such as Dell, Lenovo etc.

The Informant alleged that this led to a denial of market access and restriction of production of servers, thereby amounting to abuse of dominance under Sections 4(2)(b), 4(2)(c) and 4(2)(e) of the Act. Based on an analysis of the facts and materials on record, CCI found a prima facie case of contravention of the provisions of Section 4 of the Act and directed the DG to investigate into the matter.

The DG investigated and concluded that Intel was dominant in the market for ‘market for processors for servers in India’. However, on allegations regarding denial of access to reference design files, the DG concluded that there was no denial of access to any file by Intel. The DG also observed that the Informant was provided access to the important resources prepared by Intel for designing a server board, including complete simulation files based on which server boards can be developed.

CCI observed that the Informant’s allegations pertained primarily to denial of its entry into the server or server board market. CCI also observed that the conduct that has been assessed for contravention of the Act pertains to Intel’s purported denial of access to files that enable the Informant to design a server board compatible with its microprocessor. Accordingly, CCI held that the relevant market should be ‘the market for Processors for Servers in India’ because it is the denial of files in relation to microprocessors that have been alleged to be abusive. In view of Intel’s market share and its ability to compete independently in the relevant market, CCI concluded that Intel was dominant in the delineated relevant market.

CCI took note of: (i) the Informant’s submission that in the course of the DG’s investigation, it was provided access to the relevant files and did not choose to pursue the matter; and (ii) DG’s investigation report to assess the alleged abuse of dominant position by Intel. CCI observed that the resources that were actually required for designing a server model could be easily downloaded from Intel’s publicly accessible ‘resource data centre’. CCI also observed that the Informant had access to all the available reference design files for designing a server that were developed by Intel. In case of the other products that Intel developed, it did not develop any reference designs and therefore, could not have denied any access to the Informant for these files. As regards the simulation files, CCI concluded that the Informant did have access to the simulation models. CCI observed that there was no deliberate denial of any requisite file (reference design file or simulation file) by Intel to the Informant.

CCI accepted the DG’s findings that: (i) there was no denial of market access to the Informant in terms of Section of 4(2)(c) of the Act; (ii) Intel did not hinder or limit scientific or technical development relating to servers in the market in terms of Section 4(2)(b) of the Act; and (iii) that the allegation of leveraging (i.e., contravention of Section 4(2)(e) of the Act) did not hold against Intel. Accordingly, Intel was not found to have abused its dominant position in terms of Section 4 of the Act and CCI closed the case under Section 26(6) of the Act.

[1] Velankani Electronics Private Limited v. Intel Corporation, Case No. 16 of 2018.