BACKGROUND:

The practice of compulsory purchase of laptops sold by the University to the students amounts to tying the sale of laptops with the provision of educational services appeared, prima facie, to violate Section 3 of the Ordinance i.e. abuse of dominant position.

The University responded, inter alia, that laptops were necessary to provide students with and enable students to make optimal use of various resources. However, the University further provided that admissions were independent of laptops and the University is not profiting from the scheme. Moreover, the University revised its policy of mandatory purchase.

The Commission’s analysis rested on the element of tying which it held consists of 5 essential elements. 1) a tie exists between two separate products, 2) the tying seller has a dominant position in the tying product market so as to be able to prevent, restrict, reduce or distort competition in the tied product market, 3) coercion or forcing by the seller to purchase the two products, 4) the tie affects a not-insubstantial amount of commerce, or forecloses competition to some extent in the tied product, and 5) the tying seller has some economic interest in the sales of the tied product.

ORDER:

The University was directed to pay back to the students, who purchased laptops on installments, an amount totaling Rupees ten million (Rs. 10,000,000/-) pro-rated on the bases of the interest amount paid so far, and to be paid in future by each student.

The University was also directed to desist from making the purchase of laptops compulsory to the students in future and was required to pay students rebate and also submit a compliance report.

CURRENT STATUS:

In order to ensure compliance of its earlier order, the Commission initiated an Enquiry and concluded it vide Enquiry Report dated 01-09-2009, wherein it was concluded that the Order dated 24-07-2008 has not been complied in toto. The Commission issued a Show Cause Notice to the Bahria University for non-compliance of the order of the Single member of the Commission. The Commission has also conducted hearing in the matter and an order will be passed shortly.