Intel Corporation, USA has been found to have abused its dominant position in India by India’s fair market watchdog, the Competition Commission of India (“CCI/Commission”) . While addressing the issue of whether restrictions on warranty can be imposed by the company even if the product is genuinely purchased, the Commissionvide order dated 12 February 2026 has imposed a fine of 27.38 Cr. on Intel against its discriminatory warranty policy in India.
The case stemmed from Intel’s 2016 India-specific warranty policy, which prescribed that the manufacturer would entertain only those warranty claims that were purchased from its authorized dealer in India and refused to acknowledge the claims of products purchased from foreign authorized dealers, and in such cases, and that the claims had to be routed to the foreign country of origin of purchase for availing warranty. This policy was alleged to have imposed significant cost and time burdens, making it effectively a denial of market access for most Indian consumers as being violative of the Competition Act, 2002 (“the Act”).
Aggrieved by the said policy, M/s Matrix Info Systems Pvt. Ltd. (“informant”) filed an information under 19(1)(a) of the Act before CCI, alleging contravention of sections 3 and 4 of the Act against Intel Corporation, USA (“Intel” ) and its research and development wing, Intel Technology India Private Limited (“ITIPL”). In addition to the aforesaid, it was also alleged by the informant that the arbitrary denial of warranty caused significant loss to the independent reseller, leading to an appreciable adverse effect on competition (“AAEC”) in the Indian domestic market.
The CCI, while considering the averments made in the information, was of the prima facie opinion that the conduct of Intel shows that it had abused its dominant position, which was in contravention of 4(2)(a)(i), 4(2)(b)(i), and 4(2)(c) of the Act, and therefore, vide its order dated 09.08.2019 directed the Director General (“DG”) to investigate under 26(1) of the Act. I had also published my blog on this prima facie order by CCI against Intel in 2019 , which can be read here.
Intel challenged the Commission’s prima facie order, by filing a Writ Petition bearing W.P.(C) No. 50727 of 2019 before the Hon’ble High Court of Karnataka. Vide order dated 14.11.2019, the Hon’ble Court stayed the prima facie order passed by the Commission. Subsequently, vide judgment dated 23.08.2022, the Karnataka Hon’ble Court not only dismissed the Writ Petition filed by Intel but also imposed a cost of INR 10 lakhs (One Million) on Intel. .
Meanwhile, DG also submitted the investigation report, in confidential and non-confidential version on 25.01.2024.
Proceedings before the Commission
The CCI, after perusal of the investigation report as submitted by the DG, directed the parties to submit their objections and submissions. Responding to the investigation report, ITIPL filed an application stating that since they are not involved in the sale and manufacturing of microprocessors and their work is only limited to the research and development wing of Intel, their liability as a result of the investigation does not arise as they are not a necessary party to the ongoing dispute.
Intel. on the other side, after receiving the copies of the investigation report, moved an application for cross-examination, seeking to examine the informant and other parties based on their written submissions. However, the CCI rejected the application and was of the view that the averments had been rebutted by the Intel through written submissions made before the CCI; therefore, citing regulation 41(5) of the CCI (General) Regulations, 2009, the CCI opined that the opportunity to cross-examine may be granted only if considered necessary.
Argument advanced by Intel
Intel, while responding to the allegations regarding its warranty policy, clarified that there are two distinct concepts involved: “warranty” and “warranty service.” According to Intel, the warranty refers to the substantive assurance provided with its products. Intel offers a three-year limited warranty on all genuine boxed microprocessors (“BMP”), irrespective of where or from whom the product was purchased.
However, “warranty service” refers to the mechanism through which the warranty can be availed in practice, and this may vary across jurisdictions depending on market conditions and distribution structures. Intel submitted that since April 2016, warranty service in India has been available locally only for processors purchased from Intel’s authorized distributors in India. If a processor is purchased abroad or through an unauthorized channel within India, the warranty itself remains valid; however, the purchaser must claim the warranty service in the country where the product was originally purchased.
Intel further justified this policy by highlighting structural concerns in the IT hardware market in India, which it claimed is significantly affected by a large grey market. According to Intel, such markets often involve practices like undervaluation of goods at customs, sale of salvaged or used products disguised as new, and circulation of counterfeit products. To safeguard product quality and ensure regulatory compliance, Intel stated that it restricts local warranty service in India to products sourced through its authorized distributors, who are monitored for compliance and quality standards.
Without prejudice to the above, Intel further submitted that the informant itself had previously been found engaging in irregular practices in 2018, including misdeclaration of imported goods, undervaluation at customs, and import of old or used processors.
To conclude, Intel finally submitted that its policy applied uniformly to both consumers purchasing outside India and purchasing in India; the product purchased in India will be entertained in India, and the product purchased abroad will not be entertained in India. Therefore, the said policy was said to be uniform in its nature and poses no contravention of any alleged provisions of the Act.
Incidentally, Intel also filed an expert opinion dated 25.12.2024 of Dr. M.S. Sahoo (‘Report of Economic Expert’) in support of its contentions to justify reasonableness if the restriction.
Arguments by ITIPL
ITIPL, the research and development wing of Intel in India , argued that it is not engaged in the manufacturing or sale of any microprocessor product. It also argued that DG did not find any abuse of dominance or contravention of the act against it; therefore, it should be removed from the proceeding, as it is neither a necessary party nor a proper party to the proceeding. However, CCI rejected the request finding it premature at that stage and granted liberty to take such pleas at the time of final hearing.
The argument advanced by the informant
The informant argued that Intel holds a dominant position because it controls the market share of over 85-90% in the Indian BMP for desktops segment, and it has immense global resources. Further, the informant backing the dominance of Intel also submitted that its competitor, i.e., AMD’s presence, was limited and was insignificant to constrain Intel due to the presence of high barriers to entry, fragmented customers, and concentrated distribution channels, which made the products of Intel not substitutable with those of its competitors.
The informant reasonably argued that the India-specific warranty policy of Intel is discriminatory because Intel does not maintain such parity restrictions for customers situated in other countries like China and Australia, where, contrary to Indian customers, global warranties are accepted. Therefore, accordingly, the informant averred that this policy of Intel unfairly singled out Indian customers, denying them bona fide warranty service on Intel genuine products purchased between 2016 and 2024.
Without prejudice to the above, the informant also averred that the policy also foreclosed parallel imports and simultaneously indirectly forced system integrators and consumers to buy BMPs from authorized Indian distributors at relatively higher prices. Backing this, the informant provided evidence in the form of price comparison charts, which showed that authorized distributor prices of Intel products in India were substantially higher, 44% to 133%, than the import prices of parallel importers for certain models, which forced consumers to pay higher prices for the Intel products.
Observation by CCI
The CCI, considering the DG report and the submissions/objections to the report submitted by the party(s), was of the view that the investigation by the DG revealed no involvement of ITIPL in the alleged anti-competitive allegations (i.e., warranty policy alteration). As CCI was also of the view that ITIPL was mostly involved in R&D and support services and had nothing to do with the warranty policy. Therefore, the CCI directed that ITIPL be removed from the list of parties concerned.
In response to Intel’s application for cross-examination, CCI pointed out that under the General Regulations, cross-examination is a matter of discretion and, therefore, not an absolute right. Further, CCI observed the statutory framework of the Act allows the parties to file written submissions, to which Intel has already filed its submission.
The CCI, while dealing with the allegations of abuse dominance against Intel, delineated the Relevant Product Market (“RPM”), as the market for “Boxed Microprocessors” (“BMPs”) for Desktop PCs differs from microprocessors for laptops and other devices due to differences in portability, functionality, and end use. Also, the warranty policy in question was limited to BMPs.
Having delineated the RPM, the CCI went into assessing the dominance of Intel in such a market. The CCI, relying on the DG report, found that Intel was consistently leading the market throughout the period of contravention, as Intel’s market share was always multiples higher than its only competitor, which was seen as a strong indicator of dominance. Further, the Commission observed that Intel has significant financial resources that provide it an edge to weather market changes, invest in R&D, or engage in strategies that smaller rivals cannot match. Focusing on the actual constraints, CCI affirmed the finding of DG wherein it observed that entry barriers in the microprocessor industry were extremely high; therefore, Intel’s position was protected and durable due to high research and development costs and a huge amount involved in the establishment of microprocessor manufacturing. Considering all these factors, CCI found that Intel was dominant in the relevant market.
Having established the dominance of Intel, the CCI went into analysing whether Intel has abused such dominance in the market.
At the outset, the CCI observed that Intel’s India-specific warranty policy was discriminatory and contravened Section 4(2)(a)(i) of the Act, because Intel’s policy in India deviated from the global warranty standards followed by the company, thereby placing Indian purchasers of Intel BMPs at a disadvantage.
The CCI found that the policy effectively compelled parallel importers to procure processors only through Intel’s authorized Indian distributors if they wished to access local warranty service. This restriction adversely affected the business of parallel importers. The CCI observed that sales of such importers declined despite the overall growth of the processor market, indicating that the warranty policy had a restrictive impact on competition.
Rejecting Intel’s argument that “warranty” and “warranty service” were distinct concepts, the CCI held that warranty service forms an integral part of the product’s value proposition. In the CCI’s view, directing customers to seek warranty service in the country of purchase cannot be considered a reasonable alternative. Such a requirement involves significant costs, logistical difficulties, and time delays, which effectively deprive consumers of the practical benefit of the warranty.
Although Intel argued that the number of redirected warranty claims constituted only a small percentage of total sales, the CCI noted that Intel’s own data showed a steady increase in redirected claims as a percentage of total claims between 2016 and 2021. Moreover, for the 1,952 consumers who were denied warranty service in India during this period, the impact was substantial, particularly given the high value of the products involved.
The CCI further observed that even the possibility of being denied local warranty service can deter consumers and resellers from purchasing imported products. Such uncertainty discourages parallel imports and undermines the competitive pressure that parallel traders exert on authorized distribution channels.
Accordingly, the CCI concluded that Intel’s policy resulted in an Appreciable Adverse Effect on Competition (AAEC) in India. The policy prevented Indian consumers from availing after-sales warranty services on genuine Intel products and foreclosed the market for parallel importers, thereby restricting competition in the processor market and, hence, imposed a penalty of INR 27.38 crore (INR twenty-seven crore and thirty-eight lakhs only) or approx. USD 2.93 Million upon Intel for violation of the provisions of Section 4 of the Act.
COMMENT: Intel Corporation has long been under scrutiny by competition regulators across several jurisdictions for allegedly abusing its dominant position in the microprocessor market. Authorities in the United States, the European Union, Japan, South Korea, and China have examined Intel’s conduct, particularly its rebate and pricing practices that were alleged to foreclose competition from rival chip manufacturers such as Advanced Micro Devices (AMD). In 2009, the European Commission imposed a landmark fine of €1.06 billion on Intel for granting conditional rebates to computer manufacturers to discourage them from purchasing competitors’ processors. Although the decision was challenged, the Court of Justice of the European Union largely upheld the finding of anticompetitive conduct, with the penalty later reduced after judicial review. Similar investigations were also conducted by the Japan Fair Trade Commission and the Korea Fair Trade Commission.
Against this global backdrop, the present case explores an important dimension of abuse of dominance arising from the denial of warranty and after-sales services, which may distort competition by discouraging parallel imports and limiting consumer choice. By examining Intel’s India-specific warranty policy, the Competition Commission of India has attempted to expand the scope of abuse of dominance to include discriminatory after-sales service practices adopted by a dominant enterprise. However, since the CCI Order will be challenged by Intel in appeal before the National Company Law Appellate Tribunal (NCLAT) the final contours of this principle will depend on appellate scrutiny. The ruling of the NCLAT will determine whether the CCI’s approach treating denial of warranty and after-sales services is abusive conduct or not.
#Intel #Antitrust #Abuseofdominanace #Competitionlaw
