Decided on March 10,1993



A.N. Varma, Chairman - (1.) SONY Corporation, the second respondent in this enquiry, manufactures and sells various electronic products under the trade name "SONY". In course of time, SONY has come to acquire a substantial market for the sale of its products in India. SONY has appointed Olympia Electronics Ltd., the first respondent, as its service centre, as per the terms and conditions agreed to between the two respondents and these are set out in a written agreement dated June 1, 1990. The agreement attracted the attention of the Commission. It felt that Clause 6 of the agreement was a trade practice of exclusivity squarely falling within the purview of Section 33(1)(c) of the Monopolies and Restrictive Trade Practices Act (hereinafter referred to as "the MRTP Act").
(2.) Clause 6 of the agreement reads as follows : "6. During the term of this agreement, the repairer shall not. without prior written consent of Sony, engage in any business which is the same as or similar to the services for another manufacturer of electronic products." A notice of enquiry was accordingly issued to the respondents by the Commission under Section 10(a)(iv) and Section 37 of the Monopolies and Restrictive Trade Practices Act, 1969, stating that the respondents are and have been indulging in the aforesaid restrictive trade practice and that the said restrictive trade practice is prejudicial to public interest.
(3.) IN response to the notice, the respondents put in appearance through their learned counsel but instead of a filing reply they submitted an application under Section 37(2) of the MRTP Act offering an undertaking in the following terms : "(a) That Olympia and Sony shall forthwith discontinue the operation of Clause 6 of the service agreement ; (b) That Olympia and Sony shall not repeat in future the said restrictive practices ; (c) That Clause 6 of the service agreement shall, subject to the approval of the Director-General and of the Hon'ble Commission, be amended in terms of the draft set out in Schedule I hereto.";

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