CCI Fines Intel ₹27.38 Crore For Discriminatory India-Specific Warranty Policy On Boxed Microprocessors

New Delhi: The Competition Commission of India (CCI) on Thursday imposed a penalty of Rs 27.38 crore on chip-maker Intel Corporation (Intel) for its India specific warranty policy in respect of boxed microprocessors. The Commission, considering the fact that the India specific warranty policy was in place for eight years, imposed penalty at 8 per cent on the average relevant turnover of Intel.

However, considering the mitigating factors including the discontinuation of the aforesaid policy with effect from 01.04.2024, the Commission reduced the amount and imposed a penalty of Rs 27.38 crore on Intel. The Commission has also directed Intel to widely publicise the withdrawal of the impugned India Specific Warranty Policy, and submit a compliance report. The watchdog passed an order under the provisions of Section 27 of the Competition Act, 2002 (Act) for contravention of provisions of Section 4 of the Act.

CCI said in a statement that the case originated from the information filed by Matrix Info Systems Private Limited under Section 19 (1)(a) of the Act. “The Informant alleged that Intel amended its warranty policy for India with effect from 25.04.2016. As per this new policy, Intel would entertain warranty requests for Intel Boxed Microprocessors in India only when the same are purchased from an authorised Indian distributor of Intel (‘India Specific Warranty Policy’),” the statement added.

As a result of this India specific warranty policy, “Intel did not acknowledge warranty requests on its BMPs that are purchased from its authorised distributors in the rest of the world and instead redirected them to the country of purchase to avail the warranty”. The CCI held Intel to be dominant in the relevant market of Boxed Micro Processors for desktops in India. The Commission found India Specific Warranty Policy discriminatory in comparison with Intel’s warranty policies in China, Australia and rest of the world. It also found the policy to have “limited the choice of consumers and parallel importers and thereby causing an appreciable adverse effect on Indian consumers". Accordingly, the Commission found the conduct of Intel in contravention of provisions of Section 4 of the Act.

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