Kapoor Glass V. Schott Glass India

Abstract

The pharmaceutical industry uses glass ampoules, vials, cartridges, and syringes made by Schott Glass, a wholly owned subsidiary of the Schott group (of German origin), as packaging for liquid injectables and drugs. Neutral USP-1 borosilicate glass tubes have unique properties (such as low thermal expansion co-efficient and highly resistant to chemical reaction). These glass tubes meet the specifications set forth by the pharmaceutical industry. In its complaint to the CCI, Kapoor Glass claimed that Schott Glass had engaged in anti-competitive behavior, including (a) actions that affected the level of competition in the Indian market for Neutral USP Type I Borosilicate Glass Tubes and (b) actions that affected the level of competition in the market for downstream products like glass ampoules and other containers. The only two businesses in India manufacturing “neutral USP-I borosilicate glass tubes” were Schott Glass and Nipro Glass. In this case, Schott Glass was accused of engaging in anti-competitive behavior by allegedly granting discounts to ampoule producers in exchange for bank guarantees of Rs. 70 lacs. Moreover, it was claimed that the Converters were forced to sign several anti-competitive agreements. A request was made about a violation of sections 4(2)(a), 4(2)(e), and 3(4) of the Act, and remedies was requested under sections 27 and 33. After identifying a preliminary case, the CCI instructed the DG to look into the situation. According to the DG’s findings, Schott Glass’s glass cannot be substituted due to its distinct qualities. The relevant product market was divided roughly into two categories by DG, which used the Indian subcontinent as the relevant geographical market: (a) the market for “Neutral Clear USP-I Borosilicate Glass Tubes” (NGC), and (b) the market for “Neutral Amber USP-I Borosilicate Glass Tubes” (NGA). Schott Glass was found guilty by the CCI of violating section 4 of the Act and was given a cease-and-desist order in addition to a penalty of Rs. 5.66 crore (INR 56.6 mn). The CCI ordered that anticompetitive practises