Fight Against Corruption (NGO) and Other Vs. Airports Authority of India and Others

Case No. 12 of 2024 Page 1 of 19 COMPETITION COMMISSION OF INDIA Case No. 12 of 2024 In Re: Fight Against Corruption (NGO) (Through its Trustee - Deepak Vashist) Basement, Plot 128, Pocket 10, Sector 23B Dwarka, New Delhi- 110077 Informant No.1 Contractor Council of India (Through its President - Ajit Singh Gaur) R/o 990 A, Shahbad Mohammad Pur, Swami Chowk, Bijawasan, Southwest Delhi-110061 Informant No.2 And Airports Authority of India (Through Secretary) Rajiv Gandhi Bhawan, Safdarjung Airport, New Delhi - 110003 Opposite Party No.1 Ministry of Civil Aviation (Through Secretary) Rajiv Gandhi Bhawan, Block B, Jorbagh Safdarjung Airport Area, New Delhi – 110003 Opposite Party No.2 Delhi International Airport Limited (Through its Chairman) New Udaan Bhawan, Aerocity, Delhi – 110037 (Opposite Terminal) Opposite Party No.3 GMR Airports Limited (Through its Chairman) New Udaan Bhawan, Opposite Terminal 3 Indira Gandhi International Airport New Delhi - 110037 Opposite Party No.4 Case No. 12 of 2024 Page 2 of 19 Fraport AG Frankfurt Airport Services Worldwide (Through Director in DIAL) New Udaan Bhawan, Opposite Terminal-3 Indira Gandhi International Airport, New Delhi- 110037 Opposite Party No.5 CORAM Ms. Ravneet Kaur Chairperson Mr. Anil Agrawal Member Ms. Sweta Kakkad Member Mr. Deepak Anurag Member Order under Section 26(2) of the Competition Act, 2002 1. The present Information has been filed under Section 19(1)(a) of the Competition Act, 2002 (‘Act’) by Fight Against Corruption (‘Informant No.1’) and Contractor Council of India (‘Informant No.2’) (collectively referred herein as ‘Informants’) against Airports Authority of India (‘OP-1’/‘AAI’), Ministry of Civil Aviation (‘OP-2’/ ‘MoCA’), Delhi International Airport Limited (‘OP-3’/‘DIAL’), GMR Airports Limited (‘OP-4’/ formerly known as GMR Airports Infrastructure Limited or ‘GIL’ ) and Fraport AG Frankfurt Airport Services Worldwide (‘OP-5’/‘Fraport AG’) (collectively referred herein as ‘Opposite Parties’) alleging contravention of the provisions of Section 4 of the Act. 2. As per the Information, Informant No.1 is an NGO working in the field of curbing corruption under the name ‘Fight against Corruption’ represented by its trustee Shri Deepak Vashisht. Informant No.2 is stated to be a group of contractors’ with the name ‘Contractor Council of India’ represented by its President Shri Ajit Singh Gaur. It claims to be a third-party service provider engaged in providing construction services at Delhi and Indore airports. Case No. 12 of 2024 Page 3 of 19 3. As stated in the Information, OP-3/DIAL is a joint venture, formed as a consortium between GMR Airports Limited, Airports Authority of India and Fraport AG Frankfurt Airport Services Worldwide. OP-4/GIL is a leading global airport platform company with over two decades of experience in designing, constructing, and operating world- class sustainable airports. OP-5/Fraport AG Frankfurt Airport Services Worldwide, is a German transport company which operates Frankfurt Airport in Frankfurt am Main and holds interests in the operation of several other airports around the world. 4. As per the Informants, OP-4 entered into a joint sector agreement (‘JSA’) with the Government of India through the Secretary, MoCA for development, construction, operation and maintenance of Indira Gandhi International Airport, New Delhi (‘IGI’) vide Concessionaire Agreement dated 04.04.2006 for 30 years and the said Concessionaire Agreement is extendable by another 30 years at the option of OP-4, making it the sole concessionaire for operating IGI. It is also stated that a group consortium known as DIAL was formed with OP-4 and OP-1 and had the following shareholding as given in the shareholding document obtained from the Ministry of Corporate Affairs website: List of Shareholders of OP-3 as on 31.03.2022 S.no Name of Shareholders No. of Shares Percentage Holding 1. GMR Infrastructure Limited 100 - 2. GMR Energy Limited 100 - 3. GMR Airports Limited (formerly known as GMR Airports Infrastructure Limited) 1,567,999,798 64% 4. Fraport AG Frankfurt Airport Services Worldwide 245,000,000 10% 5. Airports Authority of India 637,000,000 26% 6. GMR Airports Limited jointly with Mr. Srinivas Bommidala 1 - 7. GMR Airports Limited jointly with Mr. Gandhi Kiran Kumar 1 - TOTAL 2,450,000,000 100% Case No. 12 of 2024 Page 4 of 19 5. As per the Information, OP-4 through OP-3 has the right to maintain, manage and operate IGI as per the Operation, Management and Development Agreement (‘OMDA’) between OP-4 and OP-1 & OP-2, which includes the use of its discretion in respect of provision of services by third parties at IGI with prior consent of its shareholder including OP-1. It is stated that OP-4 entered into agreements to give space to business entities, hotels and business houses which were desirous of operating from the airport premises. 6. It has been alleged that OP-4, in its capacity as a major shareholder in OP-3, is exploiting its dominant position and failing to comply with the stipulated competitive bidding process, as mandated by Clause 8.5.7 of the Concessionaire Agreement. It has also been alleged that OP-4 charges a fee of 13% or any other fee on all tenders for operating and doing work at Delhi Airport, specifically those related to Annual Maintenance Contracts (‘AMC’) subject to obtaining the No Objection Certificate (‘NOC’) from GMR itself. The Informants assert that such fees, particularly on AMC tenders, have a direct adverse impact on the profit margin of other industry players. 7. OP-4 is also alleged to be aligning with particular players and facilitating the victory of the aligned entity in tenders floated by OP-3. It is stated that OP-4, in collaboration with Tenaga Parking Services (India) Pvt. Ltd. (‘TPSPL’), has established a new company named Delhi Airport Parking Services Private Limited (‘DAPSL’) for the purpose of leveraging the name and experience of Tenaga Parking Services and also meeting the criteria set by OP-4 itself for parking tenders. Formation of DAPSL is stated to have occurred without following any competitive bidding process to favor OP-4 as one of the major stakeholders of DAPSL. In this regard, it is further stated that the shareholding structure of DAPSL, indicates that TPSPL holds only a 10% stake, while the majority shareholding 49.90% and 40% is retained by OP-3 and OP-4, respectively. This shareholding structure is alleged to be a mechanism that inhibits other players from entering the market. It has also been alleged that the Concessionaire Agreement has been violated by depriving due profits from OP-4 to Government of India and creating losses to public money where OP-4 holds 40% extra share on top of its stake in OP-3. Case No. 12 of 2024 Page 5 of 19 8. The Informant No.1 also annexed a letter dated 16.12.2023 addressed to the Prime Minister Office (‘PMO’), stating that Encalm, an entity responsible for providing lounges at the airport, is purportedly owned and operated by individuals who concurrently hold positions on the board of directors in GMR. This interconnection is stated to have raised concerns about potential conflicts of interest that may affect fair competition and the participation of regular vendors in offering lounge services. 9. In view of the above, the Informant have levelled the following allegations against OP- 4, in the present matter: (i) Creating a monopolistic environment, enabling it to operate without competitive restraints, which may result in imposition of exorbitant charges on customers (Airline), thereby increasing costs for end customers and potentially violating Section 4(2)(a)(i) of the Act.