The Kerala High Court (HC) has ruled that the Competition Commission of India (CCI) can investigate allegations of abuse of dominance against JioStar, even though the broadcasting sector falls under the Telecom Regulatory Authority of India (TRAI), according to a report by Bar & Bench.
Notably, the court dismissed JioStar’s appeal challenging the CCI’s 2022 Section 26(1) order directing a Director General (DG) investigation, holding that competition law enforcement operates independently of sectoral regulation.
The order was passed by a Division Bench of Justices S.A. Dharmadhikari and Syam Kumar V.M.
How the Case Started
The case stems from a complaint filed by Asianet Digital Network Private Limited, which alleged that JioStar engaged in discriminatory pricing and conduct in violation of Section 4 of the Competition Act. According to Asianet, JioStar holds a dominant position in Kerala because of its extensive content library and exclusive broadcasting rights, particularly over popular regional channels and major sporting events.
Asianet further claimed that JioStar offered discounts exceeding 50% to a competing multi-system operator, Kerala Communicators Cable Limited. These discounts were allegedly structured under “sham marketing agreements” designed to bypass TRAI’s regulatory cap limiting cumulative discounts to 35%. Asianet argued that this pricing strategy undermined fair competition and denied market access to other distributors.
The CCI reviewed the complaint and, in February 2022, formed a prima facie view that the allegations required investigation. JioStar challenged that order, first before a single judge and later before the Division Bench.
What JioStar Argued
JioStar contended that the issue was regulatory in nature and governed by TRAI’s framework, not competition law. It claimed the complaint essentially disguised a rebate-compliance dispute under TRAI regulations.
Since TRAI is the specialist regulator for the broadcasting sector, JioStar argued that the matter should have first gone before the authority rather than the CCI. It also relied on the Supreme Court’s judgment in the Bharti Airtel case to assert that the CCI must defer when a sectoral regulator is already examining the subject matter.
What the Court Said
The court firmly rejected JioStar’s position and held that the Competition Act is the appropriate framework for assessing allegations of abuse of dominance and market distortion.
Competition Act Prevails in Antitrust Enforcement
The Bench relied on the non-obstante clause in Section 60 of the Competition Act, which grants it overriding effect in case of conflict with other laws. Restricting the CCI in matters involving exclusionary conduct, the court said, would defeat the object of the Act.
Assessing Market Power Is CCI’s Mandate
The judges noted that TRAI does not have statutory power to determine whether an enterprise holds a dominant position or whether its pricing behaviour violates competition law. Such assessments fall exclusively within the CCI’s jurisdiction.
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Bharti Airtel Not Applicable Here
The court distinguished the Bharti Airtel ruling, explaining that the Supreme Court’s reasoning in that case was tied to facts involving licensing and interconnection issues already under TRAI’s scrutiny. Here, the allegation involved abuse of dominance through commercial arrangements—an area not addressed under TRAI’s regulatory framework.
Co-existence, Not Subordination
The court clarified that TRAI and the CCI operate in parallel, each governing different aspects of the broadcasting ecosystem. While TRAI handles broadcast regulation, pricing caps, and licensing, the CCI focuses on market structure and anti-competitive behaviour. If an overlap arises, the Competition Act takes precedence.
DG Probe Order Is Administrative
The Bench also reiterated that a Section 26(1) order requires no pre-hearing because it merely initiates an investigation and does not impose any findings or penalties.
Why It Matters:
The ruling clears the way for the CCI’s investigation to proceed and strengthens the legal position that regulated sectors are not insulated from competition enforcement. For broadcasting and digital distribution platforms, the judgment underscores that compliance with TRAI regulations does not substitute compliance with competition law.
More broadly, the decision reinforces a trend across telecom, tech, and digital markets: while sectoral regulators govern technical and operational rules, competition enforcement remains independent. The ruling may influence future cases involving streaming platforms, telecom operators, and digital marketplaces where regulatory and competition frameworks intersect.
With the court’s direction, the investigation will now move forward under the CCI’s oversight based on its prima facie findings.
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