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As per case facts, the manufacturer of an essential glass tubing (dominant in the upstream market) was penalised by the Competition Commission for abusing its dominant position through practices like
...loyalty-inducing rebates, exclusionary functional rebates, and a long-term supply agreement with a related downstream converter, which allegedly foreclosed rivals. The Competition Appellate Tribunal annulled the penalty, finding no proof of abuse and noting a serious procedural lapse due to the denial of cross-examination. The question arose whether the manufacturer's volume-based target-discount scheme and other agreements (functional rebate, LTTSA) constituted an abuse of dominant position by imposing discriminatory conditions or foreclosing rivals under the Competition Act, and whether a proper effects-based analysis was required for a finding of abuse. Finally, the Court dismissed the appeals, holding that none of the practices constituted an abuse as they were objectively justified by the commercial realities of continuous manufacturing (volume discounts) and brand integrity (functional rebate), leading to no appreciable adverse effect on competition (AAEC), as rivals' output and margins had increased; furthermore, the investigation was procedurally defective due to the denial of cross-examination, which in itself was sufficient to vitiate the Commission's findings.
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