CCI asks Karnataka government for relook at flexi fares on bus routes

Bengaluru: The Competition Commission has asked the Karnataka government to take a “fresh view” on flexi rates charged on certain bus routes by state-owned KSRTC even as it rejected a complaint filed against the transporter. The regulator has dismissed allegations that Karnataka State Road Transport Corporation (KSRTC) abused its dominant position on certain routes.

It was alleged that KSRTC and North West Karnataka Road Transport Corporation (NWKRTC) were not allowing the private bus operators on these routes.

Another allegation was that KSRTC, through its ‘flexi rate’ scheme was charging less fares compared to those notified, harassing private bus operators.

For the case, the Competition Commission of India (CCI) considered ‘provision of passenger road transportation services through buses in Karnataka’ as the relevant market.

Rejecting the complaint, it said there is nothing unfair on the part of KSRTC in charging fares through a ‘flexi rate’ scheme, which are less than the maximum fares fixed by the Karnataka government.

However, citing larger public interest, CCI said the “Government of Karnataka take a fresh view regarding the aforesaid schemes/decisions after inviting suggestions from various stakeholders”.

In an order dated February 27, the regulator said: “Such participatory and consultative exercise would not only inspire confidence of the stakeholders but would also make the scheme more acceptable besides obviating any possible violations of the provisions of the Act and challenge thereto.”

Further, CCI said the exercise be preferably completed within 60 days of receiving the order.

The allegations raised by the complainant “do not disclose any case of abuse of dominant position” in terms of Section 4 of the Competition Act, CCI said. Section 4 pertains to abuse of dominant position.

The complaint was filed by private bus operator Shree Gajanana Motor Transport Company.

“The Commission observes that the Motor Vehicles Act, 1988 empowers the state governments to regulate the road transport services in their respective states… In the public interest, a state government may not allow private players to operate on certain routes,” CCI said.