The maker of expensive printer ink, HP’s Indian branch, has been bitten in the rump by India’s competition watchdog for allegedly rigging government PC bids and printer supply prices.
According to Ars Technica the Competition Commission of India fined HP India and its partners about 1.4 billion rupees (€12.7 million, $14.4 million). The regulator said the outfit colluded with resellers on government PC contracts, ink cartridges, toner and other printer consumables.
The CCI said HP India worked with five resellers to coordinate bid prices for government contracts. The idea was to increase the chances of an HP partner winning.
HP India was fined 1.3 billion rupees (€11.8 million, about $13.1 million) for the PC bidding antics. It was then hit with another 119.8 million rupees (€1.1 million, about $1.2 million) for printer supply cartelisation.
The regulator said HP India had been “indulging in cartelisation in the sale and supply of supplies products comprising toner, cartridges, and other consumables used with print hardware products”.
The CCI fined 21 HP resellers another 35.2 million rupees (€319,000, about $365,335). That turns the whole thing into a pricey lesson in how not to run a channel programme.
In a separate order, the CCI said WhatsApp records showed HP India and 16 Tier-2 reseller partners operated “in a collusive arrangement”. The messages showed “bid rigging, including cover bidding, price fixation, and customer allocation during 2017-2020.”
According to the regulator, HP India played a central role in the arrangement.
HP India said high printer supply prices had led some resellers to threaten to “shift to low-cost counterfeit products to compete on price”.
The order said: “HP India was commercially forced into a position where it had to support the collusive arrangement adopted by the Tier-2 resellers.”
For its part, HP India “humbly objects to HP India’s role being characterised as a ‘kingpin’ of the collusive arrangement.”
Ars Technica noted that HP was trying to outcompete other OEMs and discourage resellers from selling “counterfeit” ink and toner. The CCI, however, appears to think the cure looked rather too much like the disease.
The watchdog ordered HP India and its channel partners to “cease and desist from anti-competitive conduct”. It told them to hold competition compliance training programmes within 60 days.
