HP India fined $14.4M over printer and PC bid cartel

HP Inc. and several resellers have been fined ₹138.85 crores/$14.4 million by the Competition Commission of India (CCI) over what the regulator described as cartelisation that raised the cost of PCs and printers.

According to The Register, the CCI found that HP India told resellers what prices to quote when bidding on government procurement tenders and barred some of them from bidding at all. In an order covering printer supplies, the regulator said it reviewed WhatsApp records showing HP staff and resellers were part of a collusive arrangement involving bid rigging, cover bidding, price fixation, and customer allocation during 2017-2020.

The CCI said HP also decided in advance which reseller would serve which customer. Cover bidding refers to one reseller submitting an intentionally uncompetitive bid so another reseller with a more reasonable quote can win.

The regulator said HP’s goal was not to favor one reseller over another, but to stay competitive against other PC and printer vendors. It also pointed to pressure from resellers over the economics of ink and toner sales. The order states that, as pricing pressure intensified because of new resellers, Tier-2 resellers threatened to switch to low-cost counterfeit products to stay competitive. Some then reached an “understanding” on pricing so they would not undercut each other, and the CCI said HP facilitated that arrangement to protect its printer supplies business.

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In a separate order on PC sales, the CCI said HP used similar coordination to handle the reverse auction process used in some tenders. According to the order, the arrangement was designed to ensure at least one HP reseller stayed in the final round even when pricing pressure became unsustainable.

The CCI has ordered HP and the resellers involved to stop all such practices.