Introduction
In Re: Shri Raghunath Patil (Case No. 03 of 2025), the Competition Commission of India (CCI) ordered on August 6, 2025, that the Director General (DG) look into claims of tying and abuse of dominance by Rashtriya Chemicals and Fertilizers Ltd. (RCF/RCFL), a Navratna public sector enterprise under the Ministry of Chemicals and Fertilizers with a majority Government of India ownership. The case is important because it brings competition law scrutiny to the selling of urea, a crucial agricultural product, which is a highly regulated and subsidized industry.
Facts of the Case
RCF allegedly forced dealers and farmers to buy non-subsidized fertilizer products (like water-soluble NPK fertilizers and other complex fertilizers) in addition to subsidized urea, according to the informant, Shri Raghunath Patil, President of ShetkariSanghatana, a Maharashtra farmers’ organization. Farmers greatly depend on suppliers like RCF for timely availability because of allocation processes, and the Government of India sets urea pricing under a subsidy framework.
It was argued that RCF used its dominant position in the urea market to enforce unfair terms through tying, limiting the options available to farmers and dealers, and shutting down rival suppliers in the tied product markets.
Issues for Consideration
The CCI (bench consisting of Ms. Ravneet Kaur (Chairperson), Mr. Anil Agrawal (Member), Ms. Sweta Kakkad (Member), and Mr. Deepak Anurag (Member)) took into consideration the following at the prima facie stage:
1.Whether RCF has a dominant position in the relevant market, which is defined as the “sale and supply of urea in the State of Maharashtra” (with market share consistently above 40% in 2023–2024).
2. Whether the purported forced sale of urea-containing fertilizers amounts to a tie-in arrangement or the imposition of unreasonable conditions.
3. Whether such behaviour qualifies as tying under Section 3(4)(a) read with Section 3(1) or abuse of dominance under Section 4 of the Competition Act, 2002.
CCI’s Prima Facie Findings
According to the CCI, urea is a necessary agricultural ingredient, and public sector organizations like RCF are crucial to its distribution under government funding. The Commission found grounds to suspect abuse of dominance and tying causing appreciable adverse effect on competition (AAEC) based on a preliminary assessment that included evidence such as government warnings/letters (from the Department of Fertilizers and Maharashtra authorities), dealer complaints, press reports, audio-video recordings, invoices, and farmer affidavits.
Importantly, the CCI made it clear that government control, price regulation, and subsidy programs do not shield businesses from scrutiny under competition law. Dominance can be exploited through non-price actions such forced bundling, denial of choice, or leveraging into neighbouring markets, even in the case of fixed pricing.
As a result, the Commission explicitly rejected Section 4(2)(c) on denial of market access and instructed the DG to look into any violations of Sections 3(4)(a) read with 3(1), 4(2)(a)(i), 4(2)(d), and 4(2)(e) of the Act. The ruling requires the DG report within 60 days, is restricted to a prima facie view, and establishes no final culpability.
Significance of the Order
The RCF case is significant for a number of reasons:
It reaffirms that public sector-dominated, regulated, and subsidized industriesincluding necessities like agricultural inputsare fully covered by competition law; regulatory oversight does not take the place of CCI jurisdiction over alleged abuses of market dominance.
It takes a sector-neutral enforcement approach and applies theories of tying and leverage to agricultural input markets.
It highlights CCI’s focus on non-price exclusionary behaviour, like possible foreclosure of competitors in connected items (like complex fertilizers and NPK).
Critical Analysis
Precise market characterization (urea vs. tied products in Maharashtra), evaluating real foreclosure impacts in the context of the policy-driven urea allocation and distribution framework, and differentiating between legitimate administrative actions and coercive tying are some of the main obstacles facing the DG inquiry. Farmers’ vulnerability and dependence, which could worsen competitive harm, must also be taken into consideration in the investigation.
The investigation is still ongoing as of December 2025; neither the DG report nor the final CCI ruling are available to the public.
Conclusion
The RCF order, which affirms that dominance in crucial, regulated marketseven for public sector enterprisesentails special responsibility, is a significant development in Indian competition law. Although the final result is still pending, it may establish standards for tying and abuse evaluations in industries with price controls.
Author Name- Shubhi Priyadarshi, BA LLB GRADUATE (GGSIPU),
