Delhi High Court Rejects Monsanto’s Plea Against Competition Commission’s 2016 Probe

The CCI investigation initiated against Monsanto in 2016 to continue, rules Delhi High Court.

Cotton bolls grow on a plant in a field in India. (Photographer: Prashanth Vishwanathan/Bloomberg)
Cotton bolls grow on a plant in a field in India. (Photographer: Prashanth Vishwanathan/Bloomberg)

The Delhi High Court dismissed Monsanto Holdings Pvt. Ltd.’s petition challenging a probe initiated by India’s competition regulator against the biotechnology firm in February 2016 in a case related to alleged unfair business practices in the domestic seeds market.

The judgment of single-judge bench of Justice Vibhu Bakhru indicates that the investigation against Monsanto will now proceed.

The dispute stems from Nuziveedu Seeds Ltd. and other companies alleging Mahyco Monsanto Biotech (India) Pvt. Ltd of abusing its dominant position in market for Bt Cotton technology by charging unfair licensing or trait fee and imposing other terms and conditions for manufacturing such genetically-modified seeds.

The trait value in the agreement was linked to MRP of the cotton seeds, which the complainants argued was unreasonable and not reflective of the economic value of the technology.

The Competition Commission of India found prima facie merit in Nuziveedu Seeds’ allegations. It also found the conditions imposed in the sub-licensing agreement to be harsh and unreasonable. On Feb. 10, 2016, the regulator directed its director general to investigate the allegations.

Monsanto moved the Delhi High Court saying the question of trait fees being unreasonable has to be determined by the Controller of Patents under the Patent Act and without such a finding the CCI had no powers to determine the issue.

The court, however, rejected all arguments by Monsanto.