Competition Commission of India & Anti Trust Laws

The Competition Commission of India (CCI) is a statutory body of the Government of India which is responsible for enforcing the Competition Act, 2002; in order to promote a competitive environment in India. It has been established by the Central Government with effect from 14th October 2003.

The Competition Act, 2002 is India’s antitrust lawAntitrust laws also referred to as competition laws, are laws developed by governments to protect consumers from unjust business practices and to ensure fair competition. Antitrust laws are applied to a wide range of questionable business activities, including market allocation, bid rigging, price fixing, and monopolies. The goal of these laws is to provide an equal business environment to similar businesses that operate in a specific industry while preventing them from gaining too much power over their competition.

The Act was repealed and replaced by the Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act)on the recommendations of the Raghavan committee.

The Act

  • Prohibits anti-competitive agreements
  • Prohibits abuse of dominant position by enterprises and
  • Regulates combinations (acquisition, acquiring of control, and M&A), which can cause or is likely to cause an appreciable adverse effect on the competition within India.
  • The Act follows the philosophy of modern competition laws.

Competition Commission of India aims to establish robust health and a competitive environment, promote and sustain competition, protect the interests of consumers and ensure freedom of trade in the markets of India by using the following approach: –

  • Through proactive engagement with all stakeholders, shareholders, society, consumers, industry, government, and international jurisdictions.
  • By being a knowledge-intensive organization with a high level of competence.
  • Through professionalism, transparency, resolve, and wisdom in its enforcement.

Competition Act, 2002

  • The Competition Act was passed in 2002 by the Government of India and has been further amended by the Competition (Amendment) Act, 2007. It follows the philosophy of modern competition laws which includes the following points:-
    • The Act completely prohibits any sort of anti-competitive agreements between the sellers and the buyer’s abuse of dominant position by enterprises and regulates combinations (acquisition, acquiring of control, and M&A), which causes or likely to cause an appreciable Negative/adverse impact on competition within India.
    • In accordance with the provisions of the Amendment Act, the Competition Commission of India and the Competition Appellate Tribunal have been established to solve the grievances of the parties and to promote a robust competitive environment in India.
    • The government of India also replaced Competition Appellate Tribunal (COMPAT) with the National Company Law Appellate Tribunal (NCLAT)in 2017.

Composition of CCI

  • The Competition Commission of India consists of one Chairperson and not less than 2 members and more than six Members as per the Competition Act who shall be appointed by the Central Government. The Commission is manned by the following members: –
  • Chairperson – Ashok Chawla,
  • Member – S. L. Bunker
  • Member – Sudhir Mital
  • Member – Augustine Peter
  • Member – U. C. Nahta

The term of office of all the members of CCI is 5 years or till the attainment of the age of 65 years(whichever is early). The members are eligible for re-appointment.

  • The commission is a quasi-judicial body that gives opinions and advice to statutory authorities and also deals with other cases. The Chairperson and other Members shall be whole-time Members of the CCI.
  • Eligibility of members:

The Chairperson and every other Member shall be a person of ability, integrity and standing knowledge and experience and who, has been, or is qualified to be a judge of a High Court, or, has special knowledge of, and professional experience of not less than fifteen years in international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs, administration or in any other matter which, in the opinion of the Central Government, may be useful to the Commission for the purpose of the appointment of the Chairperson or Member.

Functions and Role of CCI

  • To eliminate such kinds of practices having an adverse impact on competition, promote and sustain competition, protect the interests of consumers and shareholders and ensure freedom of trade in the markets of India.
  • To give any sort of opinion on competition issues on a reference received from a statutory authority established under any law and to undertake competition advocacy, create public awareness, and impart training on competition issues.
  • The Competition Commission of India takes the following measures to achieve its objectives such as:-
    • Consumer welfare: To make the markets work for the benefit, interests, and welfare of consumers.
    • Ensure fair and healthy competition in economic activities in India for faster and inclusive growth and development of the economy as a whole.
    • Implement competition policies with an objective to ensure the most efficient utilization of economic resources in an effective and efficient manner.
    • Develop and nurture effective and healthy relations and interactions with sectoral regulators to ensure smooth alignment of sectoral regulatory laws in tandem with the competition law in India.
  • The Competition Commission is India’s competition regulator and an antitrust watchdog for smaller organizations that are unable to defend themselves against large corporations with huge and capital and assets.
  • CCI has the authority to notify organizations that sell to India if it feels they may be negatively influencing and affecting competition in India and is hampering the domestic market in India.
  • The Competition Act guarantees that no enterprise abuses their ‘dominant position in a market through the control of supply, creating monopoly trade practices, manipulating purchase prices, or adopting practices that deny market access to other competing firms.
  • Any foreign company seeking entry into India through an acquisition or merger will have to abide by the country’s competition laws.
  • Additionally, an appellate body called ‘Competition Appellate Tribunal’ was also set up based on the Amendment Act of 2009, which allows for a final appeal to the Supreme Court of India.
  • CCI is, therefore, fully empowered to carry out the mandated functions.

Competition Appellate Tribunal

  • The tribunal is recognized by the Central Government to hear, and dispose of appeals against orders and directions passed by the Competition Commission of India (CCI).
  • The Competition Appellate Tribunal adjudicates claims for compensation that may have arisen from the findings of the Competition Commission of India.

The provisions of the Tribunal allow for a final appeal to the Supreme Court of India if the aggrieved parties are not satisfied with the adjudications of the tribunal.

As per Notification of Ministry of Corporate Affairs

S.O 1240 (e) – In exercise of the powers conferred by Section 53A of the Competition Act, 2002 (12 of 2003), the Central Government establishes, with effect from 15th May 2009, the Competition Appellate Tribunal having its headquarters in Delhi.    

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