as to whether ONGC had stipulated any conditions upfront while awarding the tender or subsequent thereto, which prevented Informant from making a quantitative assessment and whether there was any justification on the part of the Informant in non-submission of performance security and mobilisation of workforce, as a step leading towards fulfilment of its obligations and securing performance of awarded work. The Commission is of the prima facie view that these aspects as to who is at fault, in the facts and circumstances of the present case, do not merit consideration from a larger competition standpoint. Suffice to say that procurer is required to disclose the terms of procurement with certainty and in unambiguous terms to enable effective participation by interested parties in the tenders. As regards the more pertinent issue pertaining to blacklisting, the Commission is of the firm view that though blacklisting clauses in a contract per se are not abominable under competition law, they would be open for scrutiny based on the construct of such clauses and the exploitative and/or exclusionary abuse that it may entail on an objective assessment, when applied in a particular factual setting. Any blacklisting clause of a long term nature and which can have a cascading effect in relation to the contract inter se the parties or even inter-parties should receive careful scrutiny, when imposed by an entity with significant market power, as it could foreclose the market for the affected party, not merely in relation to potential contracts with the dominant entity, but sometimes can adversely affect existing relationship or even a potential business opportunity with third parties too. Thus, the disabilities can operate harshly and affect competition by the temporary embargo such clauses inflict by impeding an entity’s right of choice to be in business and offer its goods or services. It will therefore become incumbent upon the competition authority to carefully test, not just the excessiveness that the blacklisting clause can entail, but the manner of its invocation too, by the dominant entity, as it can result in the exit of a market participant, albeit for a limited period, or even permanently where such entities are small and can likely perish with no business activity to conduct and sustain themselves.
