HP Fined $14 Million For 'Cartelization' of Ink Cartridges, Toner, PCs

India's Competition Commission has fined HP India and its partners about 1.4 billion rupees ($14.4 million), alleging the company colluded with resellers to rig government PC bids and fix prices for ink cartridges, toner, and other printing supplies. "It said that HP was aiming to outcompete other OEMs and discourage resellers from selling 'counterfeit' ink and toner," adds Ars Technica.

Government Contract Bid Rigging

In an order, the CCI said that HP India worked with five resellers to coordinate their bid prices for government contracts to increase the chances of an HP partner winning the contracts. The company was fined 1.3 billion rupees (about $13.1 million).

Cartelization of Printing Supplies

HP was also fined 119.8 million rupees (about $1.2 million) for "indulging in cartelization in sale and supply of supplies products comprising of toner, cartridges, and other consumable used with print hardware products," CCI said in its announcement. The agency also fined 21 HP resellers 35.2 million rupees (about $365,335).

WhatsApp Evidence of Collusion

In a separate order, the CCI said that WhatsApp records showed that HP and 16 of its Tier-2 reseller partners operated "in a collusive arrangement" and that the messages show the companies engaging in "bid rigging, including cover bidding, price fixation, and customer allocation during 2017-2020." HP India played a central role, the regulator said.

HP India's Defense

Per the order, HP India said that high printing supply prices led some resellers to threaten to "shift to low-cost counterfeit products to compete on price." "HP India was commercially forced into a position where it had to support the collusive arrangement adopted by the Tier-2 resellers," the order reads. For its part, the order said that HP India "humbly objects to HP India's role being characterized as a 'kingpin' of the entire collusive arrangement."

Remedial Actions Ordered

The CCI also ordered HP India and its channel partners to "cease and desist from anti-competitive conduct" and to hold competition compliance training programs within 60 days.