ICSI Competition Law

Lesson 3
Competition and
Consumer Protection
(The Competition Act, 2002)
Section I
LESSON OUTLINE LEARNING OBJECTIVES

• Competition and Economic efficiency Competition refers to a situation in a market place in
which firms/ entities or sellers independently strive for
• Competition Law and Policy the patronage of buyers in order to achieve a
particular business objective, such as profits, sales,
• Competition Regime in India
market share etc. Competition is not an end unto
• Anti-Competitive Agreement itself, rather a means to achieve economic efficiency
and welfare objectives. Free and fair competition is
• Abuse of Dominant Position
one of the pillars of an efficient market economy.
• Combination Therefore, competition has become a driving force in
the global economy.
• Regulation of Combination
Indian economy is on a high growth path. In the
• Director General recent years the Indian economy has been one of the
• Enquiry into certain agreements and strongest performers in the world. However, the full
dominant position of enterprise growth potential of the economy remains yet to be
realised. Infusion of greater degree of competition can
• Enquiry into Combination by Commission play a catalytic role in unlocking the fuller growth
• Competition Commission of India potential in many critical areas of the economy, which
hitherto has been held back by restriction on
• Competition Appellate Tribunal (CAT)
competition in various forms.
• Competition Advocacy
This section deals with the Competition Act, 2002
• Offences and penalties covers anti-competitive agreements, abuse of
dominance, Combination, competition Advocacy,
• Power of the Central Government to make
Competition Commission of India, Competition
Rules
Appellate Tribunal and Role of professional under
• Appeal to CAT Competition Act, 2002. The Competition Act also
covers all commercial activities of Government-related
• Appeal to Supreme Court
bodies except sovereign functions of the Government.
The Competition Act, 2002 to provide, keeping in view of the economic development of the country, for the establishment
of a Commission to prevent practices having adverse effect on competition, to promote and sustain competition in the
markets, to protect the interest of consumers and to ensure freedom of trade carried on by other participant in the
markets in India and for matters connected therewith or incidental thereto.
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INTRODUCTION
There is a growing recognition that a flexible, dynamic and competitive private sector is essential to fostering
sustained economic development. Promoting effective competition spurs firms to focus on efficiency and
improves consumer welfare by offering greater choice of higher-quality products and services at lower prices.
It also promotes greater accountability and transparency in government-business relations and decision
making, helps reduce corruption, lobbying, and rent seeking. In addition, it provides opportunities for broadly
based participation in the economy and for sharing in the benefits of economic growth.
The idea of competition has had, for two centuries or more, a powerful influence on the way we think about
our society, the way we organise things and the way we conduct our own economic and personal lives. The
competition being an essential element in the efficient working of markets encourages enterprise and
efficiency and widens choice. By encouraging efficiency in industry, competition in the domestic market
whether between domestic companies alone or between those and overseas companies also contribute to
international competitiveness. The full benefits of competition are, however, felt in markets that are open to
trade and investment.
Economic theory suggests that prices and quantities in a competitive market equilibrate to levels that
generate efficient outcomes at a given point of time. Competition is therefore, beneficial as it provides to
consumers wider choice and provides sellers with stronger incentives to minimize costs, so eliminating
waste. Competition increases the likelihood that cost savings resulting from efficiency gains will be passed
on to a firm's customers, who may be either final consumers or intermediary customers (in which case costs
of those firms are also lowered). Ample empirical evidence supports these arguments. The importance of
competition for achieving a higher rate of innovation and adoption of new technologies over time is critical for
sustaining rapid growth. Yet it is not automatic, and is not the same as laissez faire.
In fact, there are reasons to believe that less mature markets tend to be more, rather than less, vulnerable to
anti-competitive practices than the markets of developed countries. Reasons include: (a) high "natural" entry
barriers due to inadequate business infrastructure, including distribution channels, and (sometimes) intrusive
regulatory regimes; (b) asymmetries of information in both product and credit markets; and (c) a greater
proportion of local (non-tradable) markets. Competition also serves to diffuse socio-economic power,
broadening participation in economic, social, and political advances while ensuring opportunities for new
entrepreneurs. Moreover, it can facilitate realization of the benefits for the domestic economy of integrating
into international trade and investment patterns.
Several studies have demonstrated the stimulating effects of competitive markets in terms of growth and
prosperity. William Lewis in his book, The Power of Productivity underlines this point forcefully with his
observations on the growth of productivity in the late 1990s in the United States. The author has argued that
more than technology and other factors, what matters above all is competition. Similarly, economist Paul
London in his book, The Competition Solution concludes that heightened competition in the US over-
shadowed tax cuts or new technologies in explaining the prosperity of the 1990s. Competitive pressures
helped suppress inflation and raise living standards though improved productivity. The author noted that
competition from imports forced the steel and auto industry, among other manufacturers, to streamline,
thereby pushing manufacturing productivity up by 4% a year. Competition has brought down real air fares,
telephone rates and several other costs. Where jobs have been lost in one industry, these have been more
than compensated by jobs created elsewhere; thus employment has not suffered but has shifted from losers
to winners. This argument underlines across the board, the benefits of competition to a wide sections of
society, including consumers, workers and many others.
Lesson 3 Competition Act, 2002 133
Definition of Competition
Competition is a complex and technical subject which does not lend itself to easy summary or concise
clarification. Of late, with globalisation and opening of the markets worldwide, it has become a subject of
great practical importance. It involves the establishment and development of concepts, legal principles and
policies for the benefit of consumer interest. The principles and policies are applied to a wide range of private
agreements and arrangements, which commercial undertakings enter into for themselves or with each other.
In addition, they also apply to the policies and directions of the Government.
In the absence of a generally accepted definition of the phenomenon of competition, it has to be regarded as
the object fostered and protected by competition policy and law. The World Bank and OECD in its Report A
Framework for the Design and Implementation of Competition Law and Policy, broadly defines the
competition is “a situation in a market in which firms or sellers independently strive for the buyers’ patronage
in order to achieve a particular business objective, for example, profits, sales or market share.”
Competition can also be defined as a process of economic rivalry between market players to attract
customers. These market players can be multinational or domestic companies, wholesalers, retailers, or
even the neighborhood shopkeeper. In their pursuit to outdo rival enterprises, market players either adopt fair
means (producing quality goods, being cost efficient, adopting appropriate technologies, etc.) or indulge in
unfair measures (carrying out restrictive business practices – such as predatory pricing, exclusive dealing,
tied selling, collusion, cartelisation, abuse of dominant position, etc.). However, in the interest of consumers,
and the economy as a whole, it is necessary to promote an environment that facilitates fair competitive
outcomes in the market, curb anti-competitive behaviour and discourage market players from adopting unfair
measures.
What is competition in the market?
In common parlance, competition in the market means sellers striving independently for
buyers’ patronage to maximize profit (or other business objectives).A buyer prefers to buy a
product at a price that maximizes his benefits whereas the seller prefers to sell the product
at a price that maximizes his profit.
Competition and Economic Efficiency

A number of empirical studies found a positive relationship between competition and innovation, productivity
and economic growth. P. Aghion and P. Howitt in Endogenous Growth Theory offered several theoretical
situations where competition is conducive to innovation – Intensified product market competition could force
managers to speed up the adoption of new technologies; Intensive product market competition with
incumbent firms engaged in step by step innovative activities could enhance each firms incentive to acquire
or increase its technological lead over its rivals and, if labour markets are flexible, competition will induce
skilled workers to move to opportunities employing best practices and technologies. Competition also
reduces slack by providing more incentives for managers and workers to increase efforts and improve
efficiency. Therefore, the product market competition disciplines firms into efficient operation.
Nickel et.al. in his article Competition and Corporate Performance suggested three different channels of
incentives – competition creates greater opportunities for comparing performance; a more competitive
environment where price elasticity of demand tends to be higher, induces greater efforts among workers and
managers for cost reducing improvements in productivity since improvements could generate larger increase
in revenue and profits; and a more competitive environment forces managers to improve efficiency, because
more intense the competition, greater the chances for inefficient to be extinguished.
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UK White Paper on World Class Competition Regime clearly brings out the importance of competition in an
increasingly innovative and globalised economy. Vigorous competition between firms is the lifeblood of
strong and effective markets. Competition helps consumers get a good deal. It encourages firms to innovate
by reducing slack, putting downward pressure on costs and providing incentives for the efficient organisation
of production.
Empirical evidences show that strong competition is closely linked to dynamic and efficient markets. The
benefits of competitive forces for economic growth and consumer welfare are widely recognized and
evidenced by several studies. Recently, an empirical study in the U.K. by the Centre for Competition Policy,
University of East Anglia showed that prices were more than halved through competition in international
telephony and airfares, and were significantly reduced in other areas. The survey also brought home the
point that competition is not just about prices but is typically multi-faceted, bringing new ways of doing
business and leading to technological and other advances.
Michel Porter in his recent work Can Japan Compete? shows that in Japan only those sectors characterized
by strong domestic competition remain internationally competitive following the country's recent economic
downturn, examples include cameras, automobiles and audio equipment. Many leading competition experts
believe in the premise that, in the presence of competition, the market will achieve the objective of
maximising welfare.
Competition Law and Policy

The World Bank and OECD in its Report A Framework for the Design and Implementation of Competition
Law and Policy pointed out that a dynamic and competitive environment, underpinned by sound competition
law and policy, is an essential characteristic of a successful market economy. Effective enforcement of
competition law and active competition advocacy can also be powerful catalysts for successful economic
restructuring. This in turn fosters flexibility and mobility of resources, which in the current global business
environment are critical elements for the competitiveness of firms and industries across nations. Although the
field of competition law and policy is evolving rapidly and includes many different viewpoints on specific
issues, recognition is growing that effective competition law is important in shaping business culture and that
its proper implementation needs to allow for the education of business people, government officials, the
judiciary, and the interested public.
The basic purpose of Competition Policy and law is to preserve and promote competition as
a means of ensuring efficient allocation of resources in an economy. Competition policy
typically has two elements: one is a set of policies that enhance competition in local and
national markets. The second element is legislation designed to prevent anti-competitive
business practices with minimal Government intervention, i.e., a competition law. Competition law by itself
cannot produce or ensure competition in the market unless this is facilitated by appropriate Government
policies. On the other hand, Government policies without a law to enforce such policies and prevent
competition malpractices would also be incomplete.
Competition policies cover a much broader set of instruments than competition law, and typically include all
policies aimed at increasing the intensity of competition or rivalry in local and national markets by lowering
entry barriers and opportunities for harmful coordination, to ensure that markets work effectively and serve
the interests of all citizens. Competition law is only a subset of a nation's competition policies. Competition
policies typically include pro-competition approaches to trade, investment, sectoral regulation, and consumer
protection. The barriers to international or interregional trade, restrictions on Foreign Direct Investment (FDI)
and technology transfers, restrictions on entry in regulated network utility industries, regulations affecting the
registration of new enterprises and the taxation and corporate governance of existing enterprises, and rules
on marketing practices all influence the extent of competitive pressures in markets and so are appropriate
concerns of competition policies. In many countries, competition authorities have become the focal point for
consultations and putting forward pro-competition viewpoints across a broad range of policy areas.
Asian Development Bank in “During economic transition or reforms”, observed that “the benefits of an open
market economy cannot be fully realized unless restrictions on competition are removed. Opening markets is
not enough by itself for countries to begin reaping the benefits of competition; firms will still find incentives to
engage in anti-competitive practices. Thus, the intended benefits of trade reforms may not be realized
without active enforcement of competition law. This highlights the importance of having faith in the benefits of
competition from an early stage of economic growth and of incorporating competition policy into the broader
economic policy framework.”
Prof. Paul Geroski, former Chairman, Competition Commission of the United Kingdom observed that
“Competition policy is about ensuring that markets are, and remain, competitive. This brings benefits to
consumers eventually in all the ways. However, eliminating anti-competitive practices and dismantling
monopoly positions that lead to abuses also benefit firms whose business suffers from these practices and
abuses. It is worth emphasizing that many of the benefits that emanate from proper application of
competition policy are felt in the first instance by firms. This is important for those who seem to think of
competition policy as an added and unnecessary burden on business. Competition policy is sometimes a
burden on business, but only on those businesses that try to unfairly disadvantage their rivals in ways that
reduce their competitive abilities or incentives to compete vigorously”.
Hence, competition policy and competition law need to be distinguished. The former can be regarded as a
genus, of which, the latter is specie.
COMPETITION REGIME IN INDIA

Historical Perspective
The Indian economy remained subject to controls and regulations for several decades, such as industrial
licensing, foreign exchange restrictions, small scale industry protection, control on foreign investment and
technologies, quantitative restrictions on imports, administered prices, and control on capital issues. The
domestic industry was thus insulated from competition.
The economic consequences of this policy regime, though initially beneficial, were reflected in a poor rate of
economic growth, low levels of productivity and efficiency, absence of international competitiveness, sub-
optimal size of businesses, and outdated and inefficient technologies in various sectors.
India has therefore witnessed two phases of development process with different policy regimes and
institutional frameworks. In the first phase, since independence, the transformation and development of the
Indian economy took place within a planned, rigidly regulated and relatively closed economic framework. In
the second phase, since 1991, when the country embarked upon reform process and embraced market
oriented policies.
In the late 1980s and early 1990s, need for liberalization policies was recognized and a range of policy and
regulatory reforms were initiated, such as delicensing of industry, shrinking the monopoly of the public sector
industries (other than those where strategic and security concerns dominated), removal of quantitative
restrictions on imports, market determined exchange rate, liberalization of foreign direct investment, capital
market reforms, liberalizing the financial markets, reduction in small scale industry reservations, and a much
greater role for the private sector in infrastructure industries such as power, port, transport and
communications.
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Economic Reforms and Competition

The world economy has been experiencing a progressive international economic integration for the last half
a century. There has been a marked acceleration in this process of globalisation and also liberalisation
during the last three decades.
Since 1991, the Government of India has introduced a series of economic reforms, including policies of
liberalisation, deregulation, disinvestment and privatisation. The seriousness of macroeconomic imbalances
and unanimity towards reform rendered this possible. The broad thrust of the new policies was a move away
from the centralised allocation of resources in some key sectors by the government to allocation by market
forces. Private participation in economic development has emerged as an alternative to the state-oriented
development strategy in the reform period.
After a decade of reforms, restraints to competition such as state monopolies and protective measures and
controls have been replaced by relatively more competitive and de-regulated open market policies. In the
post reform period, the private sector participation in production and supply of utility services has increased
substantially. Independent regulators have been established for many sectors such as road, power,
telecommunications and insurance. These sectoral regulators have been empowered to determine sector
specific entry conditions and eventually the level of competition. In nutshell, post reforms period witnessed
an open market orientation in industrial policy, foreign trade policy, foreign investment policy and financial
sector policy, infrastructure policy, etc.
Competition Law-Evolution and Development

The first Indian competition law was enacted in 1969 and was christened as the Monopolies and Restrictive
Trade Practices Act, 1969 (MRTP Act). The genesis of the MRTP Act, 1969 is traceable to Articles 38 and 39
of the Constitution of India. The Directive Principle of State Policy in those Articles lays down, inter-alia that
the State shall strive to promote the welfare of the people by securing and protecting as effectively, as it may,
a social order in which justice - social, economic and political- shall inform all the institutions of the national
life, and the State shall, in particular, direct its policy towards securing:
1. that the ownership and control of material resources of the community are so distributed as best to
subserve the common good; and
2. that the operation of the economic system does not result in the concentration of wealth and means
of production to the common detriment.
Legal framework dealing with competition in India spread over other legislations, besides the Monopolies and
Restrictive Trade Practices Act, 1969, other legislations dealing with competition include Consumer
Protection Act, 1986, the Patents Act 1970 etc.
Background to the MRTP Act, 1969
India, when it became free from the colonial power was industrially very backward. In fact, it inherited an
economy in a ravaged condition. Under development of the economy in many respects led the successor
Government to adopt a system of planning. In the interest of transformation of the backward industrial
economy into an advanced industrial economy, the planners thought it fit to allow the then established
industries to develop and grow further. Alongside, mixed economy was also developed as a concept of
economic planning. No doubt, there was perceptible growth in industrialisation. However, this also brought
on its trails, concentration of wealth and economic power. This led to widening of the difference between the
haves and have nots in the society. The Government of India therefore set up the Monopolies Inquiry
Commission in 1964 with a view to finding out the causes, the nature and the extent of concentration of
economic power in the country and to suggest remedial measures therefor.
The Monopolies Inquiry Commission submitted a detailed report in October 1965 which was well
documented and revelatory of many facets of concentration of economic power. Many of the trade practices
which were designed to stifle competition in the market and to promote monopolistic tendency were also
noticed by the Commission in the course of its inquiry. The Commission observed that there was no need to
strike at the concentration of economic power as such but to do so only when it became a menace to the
best production in quality and quantity or to fair distribution. Monopolistic conditions in any industrial sphere
should be discouraged without injury to the interests of the general public and monopolistic and restrictive
trade practices should be curbed except when they were conducive to the common good. The Commission
pointed out that on the one hand over the years certain business houses had built vast industrial empires
and on the other hand they were trying to accentuate and enlarge the empires by adopting certain trade
practices which were intended to distort competition in the market and promote a set of near monopoly
conditions. The Commission felt that such tendencies seemed to destroy the basic concept of socio-
economic justice enshrined in the Constitution. The Commission also framed a draft Bill as a part of its
recommendations.
The Monopolies and Restrictive Trade Practices Bill was introduced in Parliament in 1967 which after being
referred to the Joint Select Committee became an Act and finally came into force w.e.f. 1st June, 1970.
The enactment was based on the socio-economic philosophy enshrined in the Directive Principles of State
Policy contained in the Constitution which provides that the State shall direct its policy towards securing that
the ownership and control of material resources of the community are distributed as best to subserve the
common good and that the operation of the economic system does not result in the concentration of wealth
and means of production to the common detriment.
The principal objectives of the Act, as spelt out in the preamble were:
(i) prevention of concentration of economic power to the common detriment;
(ii) control of monopolies;
(iii) prohibition of monopolistic trade practice;
(iv) prohibition of restrictive trade practices.
The MRTP Act, 1969 underwent amendments in 1974, 1980, 1982, 1984, 1986, 1988 and 1991. Major
changes introduced in the 1982 and 1984 Amendment Acts were based on the recommendations of the
Sachar Committee. The 1984 amendment introduced the concept of unfair trade practice under the Act. Far-
reaching changes have been brought about by the 1991 amendment and these were made in the wake of
new industrial policy of July, 1991 which is wedded to liberalisation, globalisation and de-regulation.
Scheme of the MRTP Act

Prevention of undesirable concentration of economic power was sought to be achieved essentially through
the regulation of growth of undertakings of particular size, viz. undertakings having assets of the value of Rs.
100 crores. These business houses were officially designated as large business houses. Undertakings
having a sizable share of the market, or licensed production capacity of more than 1/4th of the total
production or installed capacity in India were described as dominant undertakings. These companies were
declared large business houses if their assets were of the value of Rs. 1 crore or more.
These undertakings were referred to as MRTP undertakings. Such undertakings had to obtain approval of
the Central Government to undertake substantial expansion of production, establishment of new
undertakings, amalgamate with or takeover any other undertaking. Appointment of persons who were
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directors in such undertakings as director in any other undertaking needed the approval of the Central
Government. The Central Government also had the power to order for division of such undertakings or for
severance of interconnection under certain circumstances. Restrictions were placed on the acquisition and
transfer of shares of, or by, bodies corporate owning such undertakings.
However, the MRTP (Amendment) Act, 1991 sought to liberalise these restrictions by removing the concept
of MRTP undertakings and provisions relating to their substantial expansion, amalgamation etc., and
acquisition of shares of, or by, such undertakings etc. The provisions relating to Central Governments power
to direct division of undertakings or severance of interconnection have been modified such that they apply to
all undertakings (hitherto, they applied only to MRTP undertakings).
Chapter IV deals with monopolistic trade practices indulged in by any undertaking. The Act defines the
concept of monopolistic trade practices in terms of unreasonableness of the prices charged,
unreasonableness in preventing or lessening competition in the market, unreasonably increasing prices,
profits and limiting technical development to the common detriment etc. The remedy for dealing with
monopolistic trade practice is an inquiry at the instance of the Central Government by the M.R.T.P.
Commission or suo motu by the Commission and suitable orders being passed by the Central Government
thereafter to prevent the mischief resulting from such practices.
The Act also deals with matters relating to restrictive trade practices. Briefly stated, a restrictive trade
practice is one which prevents, distorts or restricts competition for goods and services in any manner. While
unreasonableness is the test for monopolistic trade practices, even a small distortion in competition is
sufficient to bring a case under restrictive trade practices. The provisions relating to restrictive trade practices
are therefore intended to promote fair and free competition in the market. The Act provides for a scheme of
registration of certain agreements relating to restrictive trade practices. The MRTP (Amendment) Act, 1984
introduced new provisions relating to unfair trade practices with a view to promoting the interest of
consumers. It is essential to note that the M.R.T.P. Commission has been given full powers to regulate
restrictive and unfair trade practices by means of an inquiry and pass final orders thereon. The MRTP
Commission may inquire into restrictive and unfair trade practices at the instance of the Central Government,
State Government, Director General of Investigation and Registration, registered consumer associations,
individual consumer and on its own. The Commission has also powers to grant temporary injunctions and
award compensation and punish for contempt under Sections 12A, 12B and 13B of the Act respectively.
The Commission is an independent quasi-judicial body and has powers similar to a Civil Court under the
Code of Civil Procedure, 1908 on some matters. The Director General of Investigation and Registration and
the Secretary of the Commission assist in the inquiry in respect of monopolistic, restrictive and unfair trade
practices. The Commission conducts enquiries and other businesses in accordance with MRTPC
Regulations, 1991.
The Central Government has framed the Monopolies and Restrictive Trade Practices Rules, 1970, the
Monopolies and Restrictive Trade Practices (Classification of Goods) Rules, 1971, and the M.R.T.P.
(Information) Rules, 1971 in exercise of the powers conferred under the Act. However these Rules have lost
much of their significance in view of deletion of Sections 21 to 26 of the Act w.e.f. 27.9.91.
MRTP (Amendment) Act, 1991

The new industrial policy announced by the Government in Parliament on July 24, 1991 sought to amend the
MRTP Act, 1969 by removing all pre-entry restrictions and placing more emphasis on controlling and
regulating monopolistic, restrictive and unfair trade practices.
The ‘Statement of Objects and Reasons to the MRTP (Amendment) Act, 1991 reiterates that the basic
philosophy behind the MRTP Act, 1969 was not to inhibit industrial growth but to ensure that industrial
growth was channelised for public good and growth did not perpetuate concentration of economic power to
the common detriment. To quote,
1. With the growing complexity of industrial structure and the need for achieving economies of scale
for ensuring higher productivity and competitive advantage in the international market, the thrust of
the industrial policy has shifted to controlling and regulating the monopolistic, restrictive and unfair
trade practices rather than making it necessary for certain undertakings to obtain prior approval of
the Central Government for expansion, establishment of new undertakings, merger, amalgamation,
take over and appointment of directors. It has been the experience of the Government that pre-entry
restrictions under the MRTP Act on the investment decision of the corporate sector has outlived its
utility and has become a hindrance to the speedy implementation of industrial projects. By
eliminating the requirement of time-consuming procedures and prior approval of the Government, it
would be possible for all productive sections of the society to participate in efforts for maximisation
of production. It is, therefore, proposed to re-structure the MRTP Act by omitting the provisions of
Sections 20 to 26 and transfer the provisions contained in Chapter III-A regarding restrictions on
acquisition and transfer of shares to the Companies Act, 1956. The Schedule to the MRTP Act is
also consequently to be transferred with modification to the Companies Act, 1956.
2. It is also proposed to enlarge the scope of inquiry by the MRTP Commission with a view to taking
effective steps to curb and regulate monopolistic, restrictive and unfair trade practices which are
prejudicial to public interest. It is also proposed to provide for deterrent punishment for
contravention of the orders passed by the MRTP Commission and the Central Government and
empower the Commission to punish for its contempt. Certain other consequential changes are also
found necessary in the MRTP Act.
Scope and Applicability of the MRTP Act

Section 3 of the MRTP Act, 1969 provides that unless the Central Government, by notification in the Official
Gazette otherwise directs, the Act shall not apply to:
(a) undertakings owned or controlled by the Government, a government company, a corporation, a
registered cooperative society and undertakings the management of which has been taken over by
the Central Government;
(b) trade unions and other associations of workmen;
(c) financial institutions.
However, vide notification dated 27.9.1991, the Government has directed that the provisions of the MRTP
Act shall apply to all undertakings and financial institutions specified in Section 3 which were hitherto outside
the purview of the Act, except undertakings owned or controlled by a Government company, or the
Government and engaged in the production of arms and ammunition and allied items of defence equipment,
defence aircraft and warships, atomic energy, minerals specified in the schedule to the Atomic Energy
(Control of Production and Use) Order, 1953 and industrial units under the Currency and Coinage Division,
Ministry of Finance, Department of Economic Affairs. Thus, the hitherto anomoly which used to exist prior to
27.9.91 about applicability of provisions of Act between private sector enterprises and public sector
undertakings and those stated in sub-clause (a) to (g) of Section 3, has been removed.
But trade unions and other associations of workmen or employees formed for their own reasonable
protection as such workmen or employees continue to be exempt from the applicability of the MRTP Act.
However, Truck owners or operators Unions/Associations being not of workmen have been held to be
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subject to the jurisdiction of MRTP Commission by Supreme Court in the case of Bharatpur Truck Operators
Union.
In effect, all public sector companies, except those engaged in the production of arms and ammunition etc.
and industries under the Currency and Coinage Division, have been brought within the scope of the MRTP
Act in respect of monopolistic, restrictive and unfair trade practices.
MONOPOLISTIC TRADE PRACTICES

Prohibition of monopolistic trade practices is one of the objects of the MRTP Act, 1969. The word ‘monopoly’
has not been defined in the MRTP Act. But it is common knowledge that a pure monopoly as well as
‘monopolistic’ position leads to distortion of competition in the market, besides endengering in the normal
circumstances concerted action to fix prices, supplies of commodities, etc. The result of such action is no
doubt detrimental to the consuming public.
The Monopolies Inquiry Commission made copious analysis of this aspect in its report. It is worth quoting the
following passages from Chapter V of the report:
Our study of product-wise concentration brings out prominently the fact that in a large number of industries, a
single undertaking is the only supplier or at least has to its credit a very large portion of the market as
compared with its competitors. Such an undertaking has the power to dictate the price of the commodity or
services it supplies and to regulate its volume of production in such a manner as to maximize its profits. This
power is what is generally understood by the words “monopoly power" Though in the strict etymological
sense of the word, and in strict economic theory, monopoly exists when there is only one single supplier,
there is no reason why an enterprise enjoying the power to dictate the price and thus to control the market
even though it is not the single supplier should not be considered a monopoly. What happens in such cases
is that the price decided upon by the dominant producer (or distributor) is followed by others who are in a
position to compete. This price leadership phenomenon is in essence a manifestation of the price leaders
power to dictate the price in the market. We think it proper therefore to include within the word monopoly not
only the single supplier in a market but also the one dominant supplier who has the power to dictate the price
in the market."
“The question that next arises is : When such a power is shared by a few enterprises being the dominant
sellers, should they be considered to be holding a monopolistic position? We see no reason to exclude such
dominant sellers from our understanding of monopoly. For, the essence of monopoly is the ability to dictate
the price and control the market without being materially influenced by other competing concerns.”
One important difference between the situation when a single seller dominates the market and a few
independent sellers together enjoy a dominating position cannot be overlooked. In the former case,
monopoly power is inevitably present, in the latter it may or not be present. The effect on the market of a few
dominant sellers has been widely discussed by economists, specially in recent years; but their opinions are
by no means the same. We do not propose to try to resolve this controversy. It is sufficient for our purpose to
notice that it is generally agreed that when a few big sellers dominate the market there will ordinarily be a
high probability of their coming to some kind of agreement or understanding whether formal or not, about the
price and output, by which a monopolistic power is shared between themselves. Even in the absence of such
agreement or understanding it frequently happens that each has a healthy fear of the other big producers or
distributors and ultimately a policy of live and let live comes into operation. Some economists point out that
when a few large sellers dominate the market, each of them is able to calculate fairly and accurately the
probable effect on the market of his action in increasing or decreasing his output. So, it is said that each will
try to regulate the output in such a way that the marginal costs remain well below the price. Each such seller
will also be well aware that any attempt of his to reduce the price is likely to be met immediately by similar
action by his competitors. The matter is succinctly put by Stocking in Monopoly and Free Enterprise at p. 90
thus:
“In markets where sellers are few, each in trying to determine his most profitable volume of output must, as
would a monopolist, consider the probable effects of various possible rates of production not only on costs
but also on prices. Indeed each seller will ordinarily decide on the price at which he will sell and adjust his
output accordingly, just as a monopolist does. Each oligopolist however in determining his price must
consider not merely his own cost-price relationships but also how his rivals will react to his prices. Anyone of
a few sellers, if fully informed and perfectly rational, when selling a completely standardised product will
realise that if he reduces his prices his rivals will meet the lower price promptly.
For all these reasons we are convinced that when the market is dominated by a few sellers, monopolistic
conditions will sometimes prevail. At the same time, we are conscious that even in a market of a few sellers
there will sometimes be keen competition. This is likely to happen apart from the effect of the mutual
jealousies which sometimes characterise the relations between big business houses when one or more of
the few sellers feel confident that due to superior managerial ability and technical skill and financial
resources they will be able to capture a larger share of the market at the expense of their rivals. Even so
there is no gainsaying the fact that in a market of a few dominating sellers there is real risk of the emergence
of monopolistic power and consequently of monopolistic practices. To ascertain the extent to which
monopolistic practices prevail, we must examine not only the cases where a single enterprise is the sole or
dominant producer of the goods or services but also the cases where a few enterprises between themselves
share such dominating position.”
RESTRICTIVE TRADE PRACTICES

The Monopolies and Restrictive Trade Practices Act, 1969, has as one of its objects the prohibition of
restrictive trade practices. In order to ensure that the benefits of free and fair competition in a market reach
the ultimate consumer, it is essential that the process of competition should not be distorted by any trade
practice, either by a single manufacturer or a group of manufacturers or dealers. For instance, if a
manufacturer stipulates a condition that the wholesale purchaser shall sell only his products and not of
others or shall resell the goods only at the prices stipulated by him or forces the wholesale purchaser to
procure the entire line of manufacture from him, the result may be a distortion of competition in the market.
The MRTP Act is concerned with promoting fair and free competition in the market, the securing of consumer
interest being the ultimate goal.
The Monopolies Inquiry Commission in its report observed that a restrictive trade practice means a practice
which obstructs the free play of competitive forces or impedes the free flow of capital or resources into the
stream of production or of the finished goods in the stream of distribution at any point before they reach the
hands of the ultimate consumer. The Commision list out the following types of restrictive trade practices
pursued not only in India but also in many other countries. These include(i) horizontal fixation of price (ii)
vertical fixation of price and re-sale price maintenance; (iii) allocation of markets between purchasers; (iv)
discrimination between purchasers; (v) boycott; (vi) exclusive dealing contracts; and (vii) tie-up
arrangements.
The Monopolies Inquiry Commission made a wee-bit of distinction between a monopolistic trade practice and
a restrictive trade practice. It observed every monopolistic trade practice is on the face of it a restrictive trade
practice. Indeed, sometimes the two words are used indiscriminately. Thus the report of Macquarrie
Committee which was set up to study Canadian Combines Legislation treats all combines or common policy
among several firms designed to strengthen the market position of a group of firms as monopolistic
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practices. In our opinion, every practice whether it is by action or understanding or agreement, formal or
informal, to which persons enjoying monopoly power resort in exercise of the same to reap the benefits of
that power and every action, understanding or agreement tended to or calculated to preserve, increase of
consolidate such power should properly be designated monopolistic trade practice.
UNFAIR TRADE PRACTICES

Unfair trade practices in trade and commerce were prevalent even in older days. Priests in Sumaria and
Babylon are on record to have lent money to the needy at high rates of interest. During the period of Tudors,
practices of forestalling (meaning pushing up prices by buying up supplies before they reached market),
regrating (buying up supplies in the market), and engrossing (buying up supplies wherever available) were
prevalent. Thus exploitation at market place is not a new phenomena of modern civilisation. At present
various types of unfair trade practices are prevalent at National as well as at International markets. The
legislative history of countries the world over bears redeeming testimony to the endeavours of the National
Governments to enact suitable legislations to curb such unfair trade practices.
The underlying objective of such legislative endeavours has been to make the behaviour at market place
conducive to righteous dealings so that the ultimate consumer gets a fair deal. Senator Murphy, the then
Australian Attorney General, introducing the Restrictive Trade Practices Bill of the Commonwealth of
Australia in the Senate said: In consumer transactions, unfair practices are widespread. The existing law is
still founded on the principle known as ‘Caveat Emptor meaning ‘let the buyer beware. That principle may
have been appropriate for transactions conducted in village markets, it has ceased to be appropriate as a
general rule. Now the marketing of goods and services is conducted on organised basis and by the trained
business executives. The untrained consumer is no match for the businessman who attempts to persuade
the consumer to buy goods or services on terms and conditions suitable to the vendor. The consumer needs
protection by the law and this Bill will provide such protection.
It is often said that consumers need no special protection; all can be safely left to the market. But the concept
of perfect market is an economists dream and consumers sovereignty a myth. In real life products are
complex and of great variety and consumers and retailers have imperfect knowledge. Suppliers may often
have a dominant buying position. As a consequence bargaining power in the market is generally weighed
against the consumer. Thus consumers have felt the need to create organisations to identify their interests
and to supply information and advice.
The Federal Trade Commission of US is stated to have labelled under the Federal Trade Commission Act,
1914 numerous practices not known before. It was because a need was felt to ensure that the public was
prevented from being made victims of false claims of products blatantly advertised even though it may not
have an adverse effect on the competition. The effort was to shift the emphasis on detention and eradication
of fraud against the consumers, particularly those belonging to the weaker sections of the society.
Consumer Protection Law in India

The Government enacted various laws to safeguard the interest of the consumers. The Essential
Commodities Act, The Trade Marks Act, The Specific Relief Act, The Drugs Control Act, The Drugs and
Cosmetics Act, The Drugs and Magic Remedies (Objectionable Advertisements) Act, The Emblems and
Names (Prevention of Improper Use) Act, The Indian Standard Institution (Certification Marks) Act, The
Agricultural Produce (Grading and Marketing) Act, The Standards of Weights and Measures Act, etc. are a
few of the many laws intended to protect the interest of the consumer. Some of these laws alongwith the
delegated legislation framed thereunder protect both the pecuniary interest as well as other interests of the
consumer. Even the Indian Contract Act 1872 and the Sale of Goods Act, 1930 contain provisions for breach
of contracts and remedies therefor. The Indian Penal Code provides for stringent punishment for certain
offences.
In the year 1986, the Government enacted the Consumer Protection Act, 1986 and framed necessary rules
thereunder, for facilitating the formation of Consumer Protection Councils in all states and setting up of
Consumer Forums at district level, State Commission at state level and National Commission at national
level for redressing the grievances of consumers. The Government also framed the MRTP (Recognition of
Consumer Association) Rules and amended a number of economic legislations like the Essential
Commodities Act, 1955; Standards of Weights and Measures Act, 1976; Prevention of Food Adulteration Act,
1954; Drugs and Cosmetics Act, 1940 etc. to provide better protection to consumers.
However, the passing of the MRTP Act, 1969, could be said to be the beginning of the Governments concern
for consumer interest. Till the amendment of the Act in the year 1984, even the MRTP Act did not contain
provisions directly aimed at protecting the interests of consumer, but they were intended to regulate
competition in the hope that it would generate fair conduct, the effect of which would percolate to the ultimate
consumer, the terminal point in the distributive line.
Recommendations of Sachar Committee

The Government of India appointed a Committee in August, 1977 under the Chairmanship of Justice
Rajinder Sachar to look into the simplification of the working of the companies and the MRTP Act. The
Committee submitted its report in the year 1978 and as far as recommendations pertaining to the MRTP Act
are concerned, far reaching changes were suggested by the Committee. For the first time, the Committee
highlighted the need for introduction of suitable provisions to curb unfair trade practices.
In its view, the assumption that curbing monopolistic and restrictive trade practices and thereby preventing
distortion of competition automatically results in the consumers getting a fair deal was only partly true. It was felt
necessary to protect the consumers from practices adopted by trade and industry to mislead or dupe them.
The Committee pointed out that advertisements and sales promotion having become well established modes
of modern business techniques, representations through such advertisements to the consumer should not
become deceptive. If a consumer was falsely induced to enter into buying goods which do not possess the
quality and did not have the cure for the ailment advertised, it was apparent that the consumer was being
made to pay for quality of things on false representation. Such a situation could not be accepted.
Therefore, an obligation is to be cast on the seller to speak the truth when he advertises and also to avoid
half truths, the purpose being preventing false or misleading advertisements.
The Committee also noted that fictitious bargain was another common form of deception and many devices
were used to lure buyers into believing that they were getting something for nothing or at a nominal value for
their money. The Committee observed: Prices may be advertised as greatly reduced and cut when in reality
the goods may be sold at sellers regular prices. Advertised statements that could have two meanings, one of
which is false, are also considered misleading. In America, it was held that statement that a tooth paste
‘fights decay could be interpreted as a promise of complete protection and was thus deceptive. Mock-ups on
television put up by companies including Colgate Palmolive had also received the attention of the
Enforcement Agencies in America and have been held to be deceptive.
We cannot say that the type of misleading and deceptive practices which are to be found in other countries
are not being practised in our country. Unfortunately our Act is totally silent on this aspect. The result is that
the consumer has no protection against false or deceptive advertisements. Any misrepresentation about the
quality of a commodity or the potency of a drug or medicine can be projected without much risk. This has
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created a situation of a very safe heaven for the suppliers and a position of frustration and uncertainty for the
consumers. It should be the function of any consumers legislation to meet this challenge specifically.
Consumer protection must have a positive and active role.
Accordingly, the Committee specified certain unfair trade practices which were notorious and suggested
prohibition of such practices. The main category of unfair trade practices recommended for prohibition by the
Sachar Committee were: (a) misleading advertisements and false representations (b) bargain sale, bait and
switch selling; (c) offering gifts or prizes with the intention of not providing them and conducting promotional
contests; (d) supplying goods not conforming to safety standards; and (e) hoarding and destruction of goods.
In India, by an amendment to the MRTP Act in the year 1984 Part B Unfair Trade Practices was added to
Chapter V. It may be recalled that Part ‘A of Chapter V deals with registration of agreements relating to
restrictive trade practices. Section 36A, 36B, 36C, 36D and 36E are relevant for the purposes of
understanding the main provisions relating to unfair trade practices.
Scheme of the Act with respect to Unfair Trade Practices

The term ‘Unfair Trade Practices’ is defined in Section 36A which enlists a number of practices as unfair
trade practices. This definition has been amended vide the MRTP (Amendment) Act, 1991 making its scope
wider in application. Section 36B provides for an enquiry into unfair trade practices by the MRTP
Commission. Section 36C contains provision for preliminary investigation by the Director General in certain
cases. Section 36D deals with the powers of the Commission to inquire into unfair trade practice and pass
remedial orders. Section 36E empowers the Commission to exercise same powers in respect of unfair trade
practices as it exercises in respect of restrictive trade practices.
Why do we need competition in the market?

Competition is now universally acknowledged as the best means of ensuring that
consumers have access to the broadest range of services at the most competitive
prices. Producers will have maximum incentive to innovate, reduce their costs and
meet consumer demand. Competition thus promotes allocative and productive
efficiency. But all this requires healthy market conditions and governments across
the globe are increasingly trying to remove market imperfections through appropriate
regulations to promote competition.
COMPETITION ACT, 2002

Short title, extent and commencement
Section 1 of the Act provides that it shall come into force on such date as the Central Government may notify
in the Official Gazette. However, an enabling provision empowering the Government to appoint different
dates for different provisions of the Act have been incorporated. The scope of the Act extends to whole of
India except the State of Jammu and Kashmir.
Scheme of the Act

The Scheme of the Act has been split into nine chapters indicated hereunder: Chapter I contains preliminary
provisions viz. Short title, extent and Definition clauses; Chapter II provides for substantive laws i.e. Anti
Competitive Agreements, Abuse of Dominance and Regulation of Combinations; Chapter III contains
provisions relating to Establishment of Commission, Composition of Commission, Selection of Committee for
Chairperson and other Members, Term of Office of Chairperson etc. Chapter IV elaborately provides the
Duties, Powers and Functions of the Commission; Chapter V provides for the Duties of Director General;
Chapter VI stipulates Penalties for Contravention of Orders of Commission, Failure to Comply with Directions
of Commission and Director-General, Making False Statement or Omission to Furnish Material Information
etc; Chapter VII deals with Competition Advocacy; Chapter VIII contains provisions relating to Finance,
Accounts and Audit, Chapter VIII A contains provisions relating to “Competition Appellate Tribunal” [inserted
by the Competition (Amendment) Act, 2007] and Chapter IX contains Miscellaneous provisions.
DEFINITIONS
The important concepts incorporated in the Competition Act, 2002 have been defined under Section 2 of the
Act. These have been discussed herein below:
Acquisition
This term has been specifically defined. It means – directly or indirectly, acquiring or agreeing to acquire: (i)
shares, voting rights or assets of any enterprise; (ii) control over management or control over assets of any
enterprise. [(Section 2(a)]
The terms ‘acquiring’ or ‘acquisition’ are relevant for “Regulation of Combinations”.
Agreement
The term includes any arrangement or understanding or action in concert
(i) whether or not, such arrangement, understanding or concert is in formal or in writing; or
(ii) whether or not such arrangement, understanding or concert is intended to be enforceable by legal
proceedings.
It implies that an arrangement need not necessarily be in writing. The term is relevant in the context of
Section 3, which envisages that anti-competitive agreements shall be void and thereby prohibited by the law.
[Section 2(b)]
The term “Competition” is not defined in the Act. However, in the corporate world, the term is generally
understood as a process whereby the economic enterprises compete with each other to secure customers
for their product. In the process, the enterprises compete to outsmart their competitors, sometimes to
eliminate their rivals. Competition in the sense of economic rivalry is unstable and has a natural tendency to
give way to a monopoly. Thus, competition kills competition.
Cartel
“Cartel” includes an association of producers, sellers or distributors, traders or service providers who, by
agreement amongst themselves, limit control or attempt to control the production, distribution, sale or price of
or, trade in goods or provision of services. [Section 2(c)]
The nature of a cartel is to raise price above competitive levels, resulting in injury to consumers and to the
economy. For the consumers, cartelisation results in higher prices, poor quality and less or no choice for
goods or/and services.
An international cartel is said to exist, when not all of the enterprises in a cartel are based in the same
country or when the cartel affects markets of more than one country.
An import cartel comprises enterprises (including an association of enterprises) that get together for the
purpose of imports into the country.
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An export cartel is made up of enterprises based in one country with an agreement to cartelize markets in
other countries. In the Competition Act, cartels meant exclusively for exports have been excluded from the
provisions relating to anti-competitive agreements. This is because such cartels do not adversely affect
markets in India and are hence outside the purview of the Competition Act.
If there is effective competition in the market, cartels would find it difficult to be formed and sustained.
Some of the conditions that are conducive to cartelization are:
high concentration - few competitors

high entry and exit barriers
homogeneity of the products (similar products)
similar production costs
excess capacity
high dependence of the consumers on the product
history of collusion
Chairperson
Chairperson means the Chairperson of Competition Commission of India appointed under Sub-section (1) of
Section 8. [Section 2(d)]
Commission
Commission means Competition Commission of India established under Section 7(1). [Section 2(e)]
Consumer
Under that Act, the Consumer includes only such purchasers or buyers who make purchases for their own
consumption or to earn their livelihood. This deficiency has now been made good – by defining “Consumer”
under the Act. Consumer means any person who
(i) buys any goods for a consideration which has been paid or promised or partly paid and partly
promised, or under any system of deferred payment and includes any user of such goods other than
the person who buys such goods for consideration paid or promised or under any system of
deferred payment when such use is made with the approval of such person, whether such purchase
of goods is for resale or for any commercial purpose or for personal use.
(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid
and partly promised, or under any system of deferred payment when such services are availed of
with the approval of the first mentioned person whether such hiring or availing of services is for any
commercial purpose or for personal use. [Section 2(f)]
It may be noted that under the Competition Act even if a person purchases goods or avails of services for
commercial purpose, he will be a Consumer, whereas for purposes of Consumer Protection Act, a person
purchasing goods/availing services for commercial purposes is not a “Consumer” and can not seek relief
under that Act.
Director General
Director General means the Director General appointed under Section 16(1) and includes Additional, Joint or
Deputy or Assistant Director Generals. [Section 2(g)]
Enterprise
Enterprise means a person or a department of the Government, who or which is, engaged in any activity,
relating to production, control of goods or articles or provision of services, of any kind, or in investment, or in
the business of acquiring, holding, underwriting or dealing with shares, debentures or other securities
whether such unit or division or subsidiary is located at the same place where the enterprise is located or at
different place(s).
However, it does not include any activity of the Central Government relating to sovereign functions of
Government including all activities carried on by the Government Departments dealing with atomic energy,
currency, defence and space.
‘Activity’ includes profession or occupation. ‘A unit or division’ includes a plant or factory established for
production, supply, distribution, acquisition or control of any goods or any branch or office established for
provision of any service. [Section 2(h)]
It may thus be noted that sovereign function of Government are excluded from definition of enterprise but
Government Departments performing non-sovereign functions for consideration are subject to jurisdiction of
Commission.
Goods
Goods means goods as defined in Sale of Goods Act, 1930 and includes
(a) products manufactured, processed or mined;
(b) debentures, shares and stocks after allotment;
(c) in relation to ‘goods supplied’, goods imported into India. [Section 2(i)]
Member
Member means a Member of the Commission appointed under Section 8(1) of the Act and includes a
Chairperson. [Section 2(j)]
Notification
Notification means notification published in the Official Gazette. [Section 2(k)]
Person
Person includes (i) an individual; (ii) a Hindu undivided family; (iii) a company; (iv) a firm; (v) an association
of persons; (vi) a corporation established under Central, State Act or a Government Company (vii) a body
corporate incorporated by or under a law of a foreign country; (viii) a co-operative society registered under
any Law (ix) local authority (x) every artificial juridical person.
‘Government Company’ for this Section will be same as defined under Section 617 of Companies Act, 1956.
[Section 2(p)]
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Practice
Practice includes any practice relating to carrying on of any trade by a person or enterprise. [Section 2(p)]
Prescribed
Prescribed means prescribed by rules made under the Act by Central Government. [Section 2(n)]
Price
Price, in relation to sale of goods or supply of services, includes every valuable consideration, whether direct
or indirect, or deferred, and includes any consideration, which relates to sale of any goods or to performance
of any services although ostensibly relating to any other matter or thing. [Section 2(o)]
Public Financial Institution
Public Financial Institution means a Public Financial Institution as defined in Section 4A of Companies Act,
1956 and includes a State Financial, Industrial or Investment corporation. [Section 2(p)]
Regulations
Regulations means the regulations made by the Competition Commission of India. [Section 2(q)]
Relevant Market
Relevant market means the market, which may be determined by the Commission with reference to ‘relevant
product market’ or ‘relevant geographic market’ or with reference to both the markets. [Section 2(r)]
Relevant Geographic Market
Relevant Geographic Market means a market comprising the area in which the conditions of competition for
supply of goods or provision of services or demand of goods or services are distinctly homogenous and can
be distinguished from conditions prevailing in neighbouring areas. [Section 2(s)]
Relevant Product Market
Relevant Product Market means a market comprising of all those products or services which are regarded as
interchangeable or substitutable by the consumer, by reasons of characteristics of products or services, their
prices and intended use. [Section 2(t)]
The terms ‘relevant market’, ‘relevant geographical market’ and ‘relevant product market’ have relevance in
determination of the agreements being anti competitive, in evaluating combinations and dominance of an
enterprise or group. An agreement in the nature of cartel which limits or controls production, supply, market,
technical development, investments etc. need to be looked as being anti competitive with reference to
relevant market. Similarly agreement to share the market or sources of production by way of allocation of
geographical area of market, types of goods or services or number of customers in the market or by any
similar way and these need to be interpreted in the context of the definition of relevant geographical market
under Section 2(s).
Service
Service means service of any description which is made available to potential users and includes the
provision of services in connection with business of any industrial or commercial matters such as banking,
communication, education, financing, insurance, chit funds, real estate, transport, storage, material
treatment, processing, supply of electrical or other energy, boarding, lodging, entertainment, amusement,
construction, repair, conveying of news or information and advertising. [Section 2(u)]
It may be noted that under the Competition Act, the services of industrial or commercial nature also fall within
the scope of the Act whereas under the Consumer Protection Act, the services of commercial nature or for
business or industrial purposes are excluded for interpreting deficiency in the supply thereof and for
determining compensation, if any, payable to them. To this extent, the relief claimable under the Consumer
Protection Act, 1986 is limited in scope. It may also be noted that “education” has been specifically included
in ambit of “Service” to set at rest the dispute, if any, about the jurisdiction of Commission in such matters.
Shares
Shares means shares in the share capital of a company carrying voting rights and includes, –
(i) any security which entitles the holder to receive shares with voting rights;
(ii) stock except where a distinction between stock and share is expressed or implied. [Section 2(v)]
This definition of shares is much wider than what is provided under the Companies Act. It implies that not
only shares in the share capital of a company e.g. equity or preference shares are included in the definition
of shares but ‘debentures convertible into shares with voting rights’ are also included.
Statutory Authority
Statutory authority means any authority, board, corporation, council, institute, university or any other body
corporate, established by or under any Central, State or Provincial Act for the purposes of regulating
production or supply of goods or provision of any services or markets therefor or any matter connected
therewith or incidental thereto. [Section 2(w)]
It implies that this definition widens the scope of type of bodies, which are empowered to make a reference
for enquiring into anti-competitive agreement or abuse of dominant position or make a reference for opinion
on a competition issue.
Trade
Trade means any ‘trade’, business, industry, profession or occupation relating to production, supplies,
distribution, storage or control of goods and includes the provision of any services.
The definition of the term ‘trade’ is relevant, inter-alia, to the interpretation of any of the type of agreement
listed in Section 4 (a), (b), (c), (d) and (e) in relation to the trading goods and provisions of services. [Section
2(x)]
Turnover
Turnover includes value of sale of goods or services. [Section 2(y)]
The definition of the term ’turnover’, inter-alia, is relevant and significant in determining whether the
combination of merging entities exceeds the threshold limit of the turnover specified in Section 5 of the Act. It
is also relevant for the purpose of imposition of fines by the Commission.
Section 2 further provides that the words and expression used but not defined in the Competition Act, 2002
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and defined in the Companies Act, 1956 [(1) of 1956] shall have the same meaning respectively assigned to
them in the Companies Act, 1956 (1 of 1956).
Chapter II of the Competition Act, 2002 stipulates provisions relating to Prohibition of Certain Agreements,
Abuse of Dominant Position and Regulations of Combinations.
Anti Competitive Agreements

It is provided under Section 3(1) of the Competition Act that no enterprise or association of enterprises or
person or association of persons shall enter into any agreement in respect of production, supply,
distribution, storage, acquisition or control of goods or provision of services, which causes or is likely to
cause an appreciable adverse effect on competition. Section 3(2) further declares that any anti competitive
agreement within the meaning of sub-section 3(1) shall be void. Under the law, the whole agreement is
construed as ‘void’ if it contains anti-competitive clauses having appreciable adverse effect on competition.
Section 3(3) provides that following kinds of agreements entered into between enterprises or association
of enterprises or persons or associations of persons or person or enterprise or practice carried on, or
decision taken by any association of enterprises or association of persons, including “cartels”, engaged in
identical or similar goods or services which –
(a) directly or indirectly determines purchase or sale prices;
(b) limits or controls production, supply, markets, technical development, investment or provision of
services;
(c) shares the market or source of production or provision of services by way of allocation of
geographical area of market, or type of goods or services, or number of customers in the market or
any other similar way; and
(d) directly or indirectly results in bid rigging or collusive bidding;
shall be presumed to have an appreciable adverse effect on the competition and onus to prove otherwise lies
on the defendant.
The explanation appended to the Section 3 defines the term ‘bid rigging’ as any agreement between
enterprises or persons which has the effect of eliminating or reducing competition for bids or adversely
affecting or manipulating the process for bidding. Efficiency enhancing joint ventures entered into by parties
engaged in identical or similar goods or services, shall not be presumed to have appreciable adverse effect
on competition but judged by rule of reason. The term “cartel” used in the Section is the most severe form of
entering into ‘anti competitive agreements’ and has been defined in Section 2(c).
Bid rigging takes place when bidders collude and keep the bid amount at a pre-determined level. Such pre-
determination is by way of intentional manipulation by the members of the bidding group. Bidders could be
actual or potential ones, but they collude and act in concert.
Bid rigging is anti-competitive
Bidding, as a practice, is intended to enable the procurement of goods or services on the most favourable
terms and conditions. Invitation of bids is resorted to both by Government (and Government entities) and
private bodies (companies, corporations, etc.). But the objective of securing the most favourable prices and
conditions may be negated if the prospective bidders collude or act in concert. Such collusive bidding or bid
rigging contravenes the very purpose of inviting tenders and is inherently anti-competitive.
Some of the most commonly adopted ways in which collusive bidding or bid rigging may
occur are:
• agreements to submit identical bids

• agreements as to who shall submit the lowest bid, agreements for the submission of cover bids
(voluntarily inflated bids)
• agreements not to bid against each other,
• agreements on common norms to calculate prices or terms of bids
• agreements to squeeze out outside bidders
• agreements designating bid winners in advance on a rotational basis, or on a geographical or
customer allocation basis
If bid rigging takes place in Government tenders, it is likely to have severe adverse effects on its purchases
and on public spending. Bid rigging or collusive bidding is treated with severity in the law. The presumptive
approach reflects the severe treatment.
Section 3(4) provides that any agreement amongst enterprises or persons at different stages or levels of the
production chain in different markets, in respect of production, supply, distribution, storage, sale or price of,
or trade in goods or provision of services, including 
(a) tie-in agreement;
(b) exclusive supply agreement;
(c) exclusive distribution agreement;
(d) refusal to deal;
(e) resale price maintenance;
shall be an agreement in contravention of sub-section (1) if such agreement causes or is likely to cause an
appreciable adverse effect on competition in India.
The term “tie-in agreement” includes any agreement requiring a purchaser of goods, as a condition of such
purchase, to purchase some other goods. A good example of tie-in agreement is where a gas distributor
requires a consumer to buy a gas stove as a pre condition to obtain connection of domestic cooking gas.
[Chanakaya and Siddharth Gas company, In-re RTP 11/1985 decided by (MRTP Commission on 27.1.1985)]
“Exclusive supply agreement” includes any agreement restricting in any manner from acquiring or
otherwise dealing in any goods other than those of the seller or any other person. Thus, where a
manufacturer asks a dealer not to deal in similar products of its competitor directly or indirectly and
discontinues the supply on the ground that dealer also deals in product of suppliers’ competitor’s goods is an
illustration of exclusive dealing agreement. [Bhartia Curtec Hammer Ltd. In-re (1997) 24 CLA 104 (MRTPC)]
“Exclusive distribution agreement” includes any agreement to limit, restrict or withhold the output or
supply of any goods or allocate any area or market for the disposal or sale of the goods.
Requiring a distributor not to sell the goods of the manufacturer beyond the prescribed territory is a good
example of exclusive distribution agreement. Vadilal Enterprise Ltd. In-re (1998 (91) COMP CAS 824 is a
good example of exclusive distribution agreement.
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“Refusal to deal” includes any agreement, which restricts, or is likely to restrict, by any method the persons
or classes of persons to whom goods are sold or from whom goods are bought. For eg. an agreement which
provides that the franchisees will not deal in products or goods of similar nature for a period of three years
from the date of determination of agreement within a radius of five kms from showroom amounts to exclusive
dealing agreement. DGIR v. Titan industries (2001) 43 CLA 293 MRTPC.
“Resale price maintenance” includes any agreement to sell goods on condition that the prices to be
charged on resale by the purchaser shall be the prices stipulated by the seller unless it is clearly stated that
prices lower than those prices may be charged.
Any stipulation that the cement dealer should not sell below the stipulated price is a ‘resale price
maintenance’ practice and is an anti competitive practice. (In re-India Cement Ltd. RTP Inquiry 48 /1985).
The agreements falling in Section 3(3) shall be presumed to have appreciable adverse affect on competition
and thereby they are construed as deemed restrictive agreements. The agreements falling in Section 3(4)
shall be judged by rule of reason and the onus lies on the prosecutor to prove its appreciable adverse effect
on competition. The definition of all restrictive concepts covered under Section 3(4) is inclusive one.
Moreover, Section 3 does not restrict the right of any person to restrain any infringement of or to impose
reasonable conditions, as may be necessary for protecting any of his rights which have been or may be
conferred upon him under
(a) the Copyright Act, 1957;
(b) the Patents Act, 1970;
(c) the Trade and Merchandise Marks Act, 1958 or the Trade Marks Act, 1999;
(d) the Geographical Indications of Goods (Registration and Protection) Act, 1999;
(e) the Designs Act, 2000;
(f) the Semi-conductor Integrated Circuits Layout-Design Act, 2000.
That apart, the Act does not restrict any person’s right to export from India goods under an agreement which
requires him to exclusively supply, distribute or control goods or provision of services for fulfilling export
contracts. The exclusion of ‘export business’ is in view of ‘effect theory’, and doctrine of ‘relevant market’.
WHAT IS AN ANTI-COMPETITIVE AGREEMENT?

An anti-competitive agreement is an agreement having appreciable adverse effect on
competition. Anti-competitive agreements include, but are not limited to:-
• agreement to limit production and/or supply;
• agreement to allocate markets;
• agreement to fix price;
• bid rigging or collusive bidding;
• conditional purchase/ sale (tie-in arrangement);
• exclusive supply / distribution arrangement;
• resale price maintenance; and
• refusal to deal.
Prohibition of abuse of dominant position

Section 4 of the Competition Act, 2002 expressly prohibits any enterprise or group from abusing its dominant
position, meaning thereby a position of strength, enjoyed by an enterprise or group, in the relevant market, in
India, which enables it to–
(i) operate independently of competitive forces prevailing in the relevant market; or
(ii) affect its competitors or consumers or the relevant market in its favour”.
In line with the latest global trend, the dominance shall not be determined with reference to “assets”,
“turnover” or “market share”.
As per Section 2(r) ‘relevant market’ means the market, which may be determined by the Commission with
reference to the relevant ‘product market’ or ‘relevant geographic market’ or with reference to both the
markets. Thus, for determining dominance, these are relevant concepts.
The term “enterprise” means a person or a department of the Government, who or which is, or has been,
engaged in any activity, relating to the production, storage, supply, distribution, acquisition or control of
articles or goods, or the provision of services, of any kind, or in investment, or in the business of acquiring,
holding, underwriting or dealing with shares, debentures or other securities of any other body corporate,
either directly or through one or more of its units or divisions or subsidiaries, whether such unit or division or
subsidiary is located at the same place where the enterprise is located or at a different place or at different
places, but does not include any activity of the Government relatable to the sovereign functions of the
Government including all activities carried on by the departments of the Central Government dealing with
atomic energy, currency, defence and space.
For the purposes of this clause, “activity” includes profession or occupation; “article” includes a new article
and “service” includes a new service; “unit” or “division”, in relation to an enterprise, includes—
(i) a plant or factory established for the production, storage, supply, distribution, acquisition or control
of any article or goods;
(ii) any branch or office established for the provision of any service.
Section 4(2) states that there shall be abuse of dominant position, if an enterprise or group 
(a) directly or indirectly imposes unfair or discriminatory;
(i) condition in purchase or sale of goods or services; or
(ii) price in purchase or sale (including predatory price) of goods or service.
Explanation appended to Section 4 (2) clarifies that the unfair or discriminatory condition in purchase or sale
of goods or services shall not include any discriminatory condition or price which may be adopted to meet the
competition.
Section 4(2)(b) includes in abuse of dominant position an enterprise or group limiting or restricting
(i) production of goods or provision of services or market therefore; or
(ii) technical or scientific development relating to goods or services to the prejudice of consumers.
Similarly Section 4 (2) (c), (d) and (e) specify three other forms of abuses namely, if any person indulges in
practice or practices resulting in denial of market access in any manner; or makes conclusion of contracts
subject to acceptance by other parties of supplementary obligations which, by their nature or according to
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commercial usage, have no connection with the subject of such contracts and also, if any person uses
dominant position in one relevant market to enter into, or protect, other relevant market.
The term “predatory price” has been defined as the sale of goods or provision of services, at a price which is
below the cost, as may be determined by regulations, of production of goods or provision of services, with a
view to reduce competition or eliminate the competitors. Thus, the two conditions precedent to bring a case
with the ambit of predatory pricing are:
(i) selling goods or provision of service at a price which is below its cost of production and
(ii) that practice is resorted to eliminate the competitors or to reduce competition.
The Competition Commission of India has been empowered under Section 19(4) of the Act to determine
whether any enterprise or group enjoys a dominant position or not, in the ‘relevant market’ and also to decide
whether or not there has been an abuse of dominant position. It may be noted that mere existence of
dominance is not to be frowned upon unless the dominance is abused.
WHAT CONSTITUTES ABUSE OF DOMINANCE?

Dominance refers to a position of strength which enables an enterprise to operate
independently of competitive forces or to affect its competitors or consumers or the
market in its favour. Abuse of dominant position impedes fair competition between
firms, exploits consumers and makes it difficult for the other players to compete with
the dominant undertaking on merit. Abuse of dominant position includes:
• imposing unfair conditions or price,
• predatory pricing,
• limiting production/market or technical development ,
• creating barriers to entry,
• applying dissimilar conditions to similar transactions,
• denying market access, and
• using dominant position in one market to gain advantages in another market.
Combinations
Combination has broad coverage and includes acquisition of control, shares, voting rights, assets, merger or
amalgamation. The acquisition of one or more enterprises by one or more person or merger or
amalgamation of enterprises shall be a combination of such enterprises and persons or enterprises, if –
(a) any acquisition where
(i) the parties to the acquisition, being the acquirer and the enterprise, whose control, shares,
voting rights or assets have been acquired or are being acquired jointly have, -
(A) either, in India, the assets of the value of more than rupees one thousand crores or
turnover more than rupees three thousand crores; or
(B) in India or outside India, in aggregate, the assets of the value of more than five hundred
million US dollars, including at least rupees five hundred crores in India or turnover more
than fifteen hundred million US dollars, including at least rupees fifteen hundred crores in
India; or
(ii) the group, to which the enterprise whose control, shares, assets or voting rights have been
acquired or are being acquired, would belong after the acquisition, jointly have or would jointly
have, -
(A) either in India, the assets of the value of more than rupees four thousand crores or
turnover more than rupees twelve thousand crores; or
(B) in India or outside India, in aggregate, the assets of the value of more than two billion US
dollars, including at least rupees five hundred crores in India or turnover more than six
billion US dollars, including at least rupees fifteen hundred crores in India; or
(b) acquiring of control by a person over an enterprise when such person has already direct or indirect
control over another enterprise engaged in production, distribution or trading of a similar or identical
or substitutable goods or provision of a similar or identical or substitutable service, if -
(i) the enterprise over which control has been acquired along with the enterprise over which the
acquirer already has direct or indirect control jointly have,
(A) either in India, the assets of the value of more than rupees one thousand crores or
turnover more than rupees three thousand crores; or
India; or
(ii) the group, to which enterprise whose control has been acquired, or is being acquired would
belong after the acquisition, jointly have would jointly have,
(A) either in India, the assets of the value of more than rupees four thousand crores or
(B) in India or outside India, in aggregate, the assets of the value of more than two billion US
dollars, including at least rupees five hundred crores in India or turnover more than six
billion US dollars including at least rupees fifteen hundred crores in India; or
(c) any merger or amalgamation in which
(i) the enterprise remaining after merger or the enterprise created as a result of the amalgamation,
as the case may be, have, -
(A) either in India, the assets of the value of more than rupees one thousand crores or
turnover more than rupees, three thousand crores; or
India; or
(ii) the group, to which the enterprise remaining after the merger or the enterprise created as a
result of the amalgamation, would belong after the merger or the amalgamation, as the case
may be, have or would have, -
(A) either in India, the assets of the value or more than rupees four thousand crores or
(B) in India or outside India, the assets of the value of more than two billion US dollars
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including at least rupees five hundred crores in India or turnover more than six billion US
dollars, including at least rupees fifteen hundred crores in India.
It may be pointed out that “control” for the purposes of this section includes controlling the affairs or
management by  (i) one or more enterprises, either jointly or singly, over another enterprise or group; (ii)
one or more groups, either jointly or singly, over another group or enterprise.
The term “group” means two or more enterprises, which, directly or indirectly, are in a position to
(i) exercise less than fifty percent of voting rights in other enterprise; or
(ii) appoint more than fifty per cent of the members of the board of directors in other enterprise; or
(iii) control the management or affairs of the other enterprise.
It is further provided that the “value of the assets” shall be determined on the basis of the value of assets as
shown in the audited books of account of the enterprise, in the financial year immediately preceding the
financial year in which the date of proposed merger falls, after deducting any depreciation therefrom. The
value of the assets shall also include the brand value, value of goodwill, or value of copyright, patent,
permitted use, collective mark, registered proprietor, registered trade mark, registered user, geographical
indications, design or layout design or similar other commercial rights, referred to in Section 3(5).
It is clear from the above that two kinds of norms have been prescribed which would attract Section 5. Firstly,
the “value of asset” and secondly the “turnover” in India or outside India. In the case of a “group” the “assets”
or “turn over” of the “group” has to be aggregated and in the case of “merger” or “amalgamation” the value of
the “assets” or “turn over” of the resultant entity has to be computed in case the parties do not belong to a
‘group’. In case a party belongs to a group, the assets or turnover of the group and the merged or
amalgamated entity could belong. It is also noteworthy that the control may be either by one or more
enterprises over another enterprise or a group or one or more groups singly or jointly over another group or
enterprise. It is also significant to note that while computing the value of the assets both `physical assets’ and
the intangible ones such as `goodwill’ or `trade mark’ etc. will be taken into account in determining whether
reporting requirements get triggered or not.
In exercise of the powers conferred by the sub section (3) of Section 20 of the Competition Act, 2002, the
Central Government in consultation with the Competition Commission of India, vide its Notification S.O.
th
480(E) dated 4 March, 2011 enhance, on the basis of Wholesale Price Index, the value of assets and the
value of turnover, by fifty per cent for the purposes of Section 5 of the Act.
The Central Government, in Public interest, exempts an enterprise, whose control, shares, voting rights or
assets are being acquired has assets of the value of not more than Rs. 250 crores or turnover of not more
than Rs. 750 crores from the provisions of Section 5.
WHAT IS COMBINATION?
Broadly, combination under the Act means acquisition of control, shares, voting
rights or assets, acquisition of control by a person over an enterprise where such
person has direct or indirect control over another enterprise engaged in competing
businesses, and mergers and amalgamations between or amongst enterprises when
the combining parties exceed the thresholds set in the Act. The thresholds are
specified in the Act in terms of assets or turnover in India and outside India. Entering
into a combination which causes or is likely to cause an appreciable adverse effect
on competition within the relevant market in India is prohibited and such combination shall be void.
Threshold of Combination specifies under section 5 of the Act in tabular form given bellow:
On March 4, 2016, the Central Government issued notifications pertaining to the statutory thresholds for the
purposes of “combinations” under Section 5 of the Competition Act, 2002(“Act”).
1. Increase in thresholds: Pursuant to Notification No. S.O. 675(E) dated March 4, 2016, the value of
assets and the value of turnover has been enhanced by 100% for the purposes of Section 5 of the
Act. Accordingly, the revised thresholds for notification to the Competition Commission of India
(“Commission”) are:
THRESHOLDS FOR FILING NOTICE
Assets Turnover
Enterprise Level India >2000 INR crore >6000 INR crore
Worldwide with >USD 1 bn with at OR >USD 3 bn with at least

India Leg least > 1000 INR crore > 3000 INR crore in
in India India
OR
Group Level India >8000 INR crore >24000 INR crore
Worldwide with >USD 4 bn with at OR >USD 12 bn with at

India leg least >1000 INR crore least > 3000 INR crore
in India in India
1. Increase in thresholds of De Minimis Exemption: Pursuant to Notification No. S.O. 674 (E)dated
March 4, 2016, acquisitions where enterprises whose control, shares, voting rights or assets are
being acquired have assets of not more than Rs. 350 crore in India or turnover of not more than Rs.
1000 crore in India, are exempt from Section 5 of the Act for a period of 5 years. Accordingly, the
revised threshold for availing of the De Minimis exemption for acquisitions are:
THRESHOLDS FOR AVAILING OF DE MINIMIS EXEMPTION FOR ACQUISITIONS
Assets Turnover
Target In India < 350 INR crore OR < 1000 INR crore
Enterprise
1. Definition of Group: As per Notification No. S.O. 673 (E) dated March 4, 2016, the exemption to
the “group” exercising less than fifty per cent of voting rights in other enterprise from the provisions
of Section 5 of the Act under Notification No. S.O. 481 (E) dated March4, 2011, has been continued
for a further period of 5 years.
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Regulation of Combinations
Section 6 of the Competition Act prohibits any person or enterprise from entering into a combination which
causes or is likely to cause an appreciable adverse effect on competition within the relevant market in India
and if such a combination is formed, it shall be void. Section 6(2) envisages that any person or enterprise,
who or which proposes to enter into any combination, shall give a notice to the Commission disclosing
details of the proposed combination, in the form, prescribed and submit the form together with the fee
prescribed by regulations. Such intimation should be submitted within 30 days of
(a) approval of the proposal relating to merger or amalgamation, referred to in Section 5(c), by the board
of directors of the enterprise concerned with such merger or amalgamation, as the case may be;
(b) execution of any agreement or other document for acquisition referred to in Section 5(a) or
acquiring of control referred to in Section 5(b).
A newly inserted sub-section (2A) envisages that no combination shall come into effect until 210 days have
passed from the day of notice or the Commission has passed orders, whichever is earlier.
The Competition Commission of India (CCI) has been empowered to deal with such notice in accordance
with provisions of Sections 29, 30 and 31 of the Act. Section 29 prescribes procedure for investigation of
combinations. Section 30 empowers the Commission to determine whether the disclosure made to it under
Section 6(2) is correct and whether the combination has, or is likely to have, an appreciable adverse effect
on the competition. Section 31 provides that the Commission may allow the combination if it will not have any
appreciable adverse effect on competition or pass an order that the combination shall not take effect, if in its
opinion, such a combination has or is likely to have an appreciable adverse effect on competition.
The provisions of Section 6 do not apply to share subscription or financing facility or any acquisition, by a
public financial institution, foreign institutional investor, bank or venture capital fund, pursuant to any
covenant of a loan agreement or investment agreement. This exemption appears to have been provided in
the Act to facilitate raising of funds by an enterprise in the course of its normal business. Under Section 6(5),
the public financial institution, foreign institutional investor, bank or venture capital fund, are required to file in
prescribed form, details of the control, the circumstances for exercise of such control and the consequences
of default arising out of loan agreement or investment agreement, within seven days from the date of such
acquisition or entering into such agreement, as the case may be.
As per the explanation appended to Section 6(5)
(a) “foreign institutional investor” has the same meaning as assigned to it in clause (a) of the
Explanation to Section 115AD of the Income-tax Act, 1961;
(b) “venture capital fund” has the same meaning as assigned to it in clause (b) of the Explanation to
clause (23 FB) of Section 10 of the Income-tax Act, 1961.
It may be noted that under the law, the combinations are only regulated whereas anti-competitive
agreements and abuse of dominance are prohibited. Further, under the MRTP Act prior to 27.9.91,
undertakings of certain size were required to be registered and such undertakings were required to seek
prior approval of the Central Government before embarking upon expansion plans. In the present Act, there
is no requirement of registration of an undertaking and further, there is no need to have prior approval of the
Central Government but CCI will only examine as to whether or not combination is or is likely to have an
appreciable adverse effect on competition.
The Competition Act with many innovative concepts coupled with power to impose fine is likely to let in harsh
glare of sunlight to disinfect pernicious anti-competitive practices.
Competition Commission of India
Establishment of Commission
The Central Government under Section 7 has been empowered to establish a Commission to be called
“Competition Commission of India” by issue of a Notification. The Commission is a body corporate having
perpetual succession and a common seal. The Commission has power to acquire, hold movable or
immovable property and to enter into contract in its name and by the said name, sue or be sued. In the
premises, the set up of Commission corresponds to that of Securities & Exchange Board of India constituted
under the SEBI Act, 1992.
The Head Office of the Commission shall be at such place as the Central Government may decide from time
th
to time. Vide Notification: SO 1198(E) dated 14 Oct., 2003, the Central Government established the
Competition Commission of India having its Head Office at New Delhi.
The Commission has also been authorized to establish its office at other places in India. Thus, the law
provides for setting up of CCI’s offices at places other than that of its Headquarter.
Composition of Commission
The composition of the Commission as spelled out under Section 8 of the Act consists of a Chairperson and
not less than two and not more than six other Members. The Chairperson and the Members are to be
appointed by the Central Government. Regarding the qualifications of the Chairman and other Members,
Section 8(2) provides that they shall be person of ability, integrity and standing and who has special
knowledge of and such professional experience of not less than fifteen years in international trade,
economics, business, commerce, law, finance, accountancy, management, industry, public affairs or
competition matters including competition law and policy which in the opinion of the Central Government,
may be useful to the commission. The Chairperson and other Members are to be appointed on whole time
basis.
Selection of Chairperson and Members of Commission
Section 9(1) envisages that the Chairperson and other Members of the Commission shall be appointed by
the Central Government from a panel of names recommended by a Selection Committee consisting of the
Chief Justice of India or his nominee, as Chairperson; and the Secretary in the Ministry of Corporate Affairs,
Member; the Secretary in the Ministry of Law and Justice, Member; and two experts of repute who have
special knowledge of, and professional experience in international trade, economics, business, commerce,
law, finance, accountancy, management, industry, public affairs or competition matters including competition
law and policy, as member.
Term of office of Chairperson and other Members
The Act stipulates that the Chairperson and every other Member shall hold office as such for a term of
five years from the date on which he enters upon his office and shall be eligible for re-appointment.
However, the Chairperson or other Members shall not hold office as such after he has attained the age
of sixty-five years.
A vacancy caused by the resignation or removal of the Chairperson or any other Member under section 11 or
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by death or otherwise shall be filled by fresh appointment in accordance with the provisions of sections 8 and
9. The Chairperson and every other Member shall, before entering upon his office, make and subscribe to an
oath of office and of secrecy in such form, manner and before such authority, as may be prescribed.
In the event of the occurrence of a vacancy in the office of the Chairperson by reason of his death,
resignation or otherwise, the senior-most Member shall act as the Chairperson, until the date on which a new
Chairperson, appointed in accordance with the provisions of this Act to fill such vacancy, enters upon his
office. When the Chairperson is unable to discharge his functions owing to absence, illness or any other
cause, the senior-most Member shall discharge the functions of the Chairperson until the date on which the
Chairperson resumes the charge of his functions.
Resignation of Chairperson etc.

It has been provided under section 11 that the Chairperson or any other Member may resign his office by
notice in writing under his hand addressed to the Central Government. However, until the Chairperson or a
Member is permitted by the Central Government to relinquish his office, he will continue to hold his office
until the expiry of three months from the date of receipt of such notice or until a person duly appointed as a
successor enters into his office or until the expiry of his term, which ever is the earliest. Under Section 11(2),
it is provided that in the following circumstances the Central Government may, by order, remove the
Chairperson or any Member from his office if such Chairman or Member as the case may be, -
(a) is, or at any time has been, adjudged as an insolvent; or
(b) has engaged at any time, during his term of office, in any paid employment; or
(c) has been convicted of an offence which, in the opinion of the Central Government, involves moral
turpitude; or
(d) has acquired such financial or other interest as it likely to affect prejudicially his functions as a
Member; or
(e) has so abused his position as to render his continuance in office prejudicial to the public interest; or
(f) has become physically or mentally incapable of acting as a Member.
However, no Member shall be removed from his office on the ground that he has acquired such financial or
other interest as is likely to affect prejudicially his function as a Member or has so abused his position as to
render his continuance in public office prejudicial to the public interest unless the Supreme Court, on a
reference being made to it in this behalf by the Central Government, has on an inquiry as prescribed
reported that the Member ought on such ground or grounds to be removed.
Section 12 provides that for a period of two years from the date on which the Chairperson and other Member
cease to hold office shall not accept any appointment in or connected with the management or administration
of, any enterprise which has been a party to the proceeding before the Commission. This restriction,
however, shall not apply to any employment under the Central Government or a State Government or local
authority or any corporation established by or under any Central, State or Provincial Act or a Government
company as defined in Section 617 of the Companies Act, 1956 (10 of 1956).
Financial and Administrative Powers of Member Administration

A Member of the Commission as per Section 13 may be designated by the Central Government as Member
Administration who shall exercise such financial and administrative powers as may be vested in him under
the rules made by the Central Government. However, the Member Administration shall have authority to
delegate such of his financial and administrative powers to any other officer of the Commission as he may
deem fit subject to the condition that, while exercising delegated powers such official shall continue to act
under the direction, superintendence and control of the Member Administration.
Salary and Terms and Conditions of Service
The salary allowances and other terms and conditions of service of the Chairman and other member including
travel expenses, house rent allowance, conveyance facility, sumptuary allowance and medical facilities shall be
such as may be prescribed. Further, to ensure freedom in the functioning of the Chairperson and the Member,
Section 14(2) provides that the salary allowance and other terms and conditions of service of the Chairperson
or Member shall not be varied to his disadvantage after his appointment.
No act or proceedings of the Commission shall be invalid merely because there is any vacancy in the
Commission or defect in the constitution of the Commission; or any defect in the appointment of Chairperson
or a Member; or any irregularity in the procedure of the Commission not affecting the merits of the case.
Appointment of Director General
Director General is an important functionary under the Act. He is to assist the Commission in conducting
inquiry into contravention of any of the provisions of the Act and for performing such other functions as are,
or may be, provided by or under the Act.
Section 16 (1) empowers the Central Government to appoint a Director General and such number of
additional, joint, deputy or assistant Director Generals or other advisers, consultants or officers for the
purposes of assisting the Commission in conducting inquiry into the contravention of any provision of the Act.
Additional, joint, deputy and assistant Director Generals, other advisors, consultants and officers shall
however, exercise powers and discharge functions subject to the general control, supervision and directions
of the Director General.
The salary, allowances and other terms and conditions and service of Director General, consultants, advisers
or other officers assisting him shall be such as may be prescribed by the Central Government. The Director
General, advisers, consultants and officers assisting him are to be appointed from amongst the persons of
integrity and outstanding ability and who have experience in investigation, and knowledge of accountancy,
management, business, public administration, international trade, law or economics and such other
qualifications as may be prescribed.
The Commission may appoint a Secretary and such officers and other employees, as it considers necessary
for the efficient performance of his functions under the Act. The Commission may engage, in accordance
with the procedure specified by regulations, such number of experts and professionals of integrity and
outstanding ability, who have special knowledge of, and experience in, economics, law, business or such
other disciplines related to competition, as it deems necessary to assist the Commission in the discharge of
its functions under the Act.
Duties, Powers and Functions of Commission
As per Section 18 of the Act, duties of the CCI are:

(a) to eliminate practices having adverse effect on competition;
(b) to promote and sustain competition;
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(c) to protect interests of consumers and

(d) to ensure freedom of trade carried on by other participants, in markets in India.
Section 18 empowers the Commission to enter into any memorandum or arrangement, with the prior
approval of the Central Government, for the purpose of discharging the duties and functions under this Act
with any agency of any foreign country. This will enable the CCI to have extra territorial reach and shall
facilitate exchange of information and enforcement of its order.
Inquiry into certain agreements and dominant position of enterprise
The Commission may inquire into any alleged contravention of Section 3(1) or 4(1) on its own motion or on
(a) receipt of any information in such manner and accompanied by such fee, from any person,
consumer or consumer association or trade association; or
(b) a reference made to it by the Central Government or State Government or a statutory authority.
The Director General is not vested with a right to move an application for institution of an enquiry relating to
anti-competitive agreements or abuse of dominance.
The terms ‘person’ and ‘statutory authority’ have been defined under Sections 2(l) and 2(w) respectively. The
term ‘person’ has been given wide connotation and it includes an individual, a HUF, a company, a firm, an
association of persons, any corporation established under any Central, State or Provincial Act or a
Government company, a co-operative society, a local authority and every artificial juridical person.
Section 19(3) provides that while determining whether an agreement has appreciable adverse effect
on competition, the Commission shall give due regard to all or any of the following factors, namely–
(a) creation of barriers to new entrants in the market;
(b) driving existing competitors out of the market;
(c) foreclosure of competition by hindering entry into the market;
(d) accrual of benefits to consumers;
(e) improvements in production or distribution of goods or provision of services;
(f) promotion of technical, scientific and economic development by means of production or

distribution of goods or provision of services.
The first three factors are anti-competitive, while the latter three factors deal with benign effects.
“Adverse appreciable affect on competition” is a key factor while enquiring into anti-competitive agreement.
The touch stone of appreciable adverse effect on competition need not be proved while enquiring into abuse
of dominance.
For the purpose of determining whether an enterprise enjoys dominant position or not under
Section 4, the Commission shall have due regard to all or any of the following factors, namely –
(a) market share of the enterprise;
(b) size and resources of the enterprise;
(c) size and importance of the competitors;
(d) economic power of the enterprise including commercial advantages over competitors;
(e) vertical integration of the enterprises or sale or service network of such enterprises;
(f) dependence of consumers on the enterprise;
(g) monopoly or dominant position whether acquired as a result of any statute or by virtue of being a
Government company or a public sector undertaking or otherwise;
(h) entry barriers including barriers such as regulatory barriers, financial risk, high capital cost of
entry, marketing entry barriers, technical entry barriers, economies of scale, high cost of
substitutable goods or service for consumers;
(i) countervailing buying power;
(j) market structure and size of market;
(k) social obligations and social costs;
(l) relative advantage, by way of the contribution to the economic development, by the enterprise
enjoying a dominant position having or likely to have an appreciable adverse effect on
competition;
(m) any other factor which the Commission may consider relevant for the inquiry.
The present law makes explicit the issues and the parameters which will be considered while deciding
“abuse of dominance”. The Commission shall have due regard to the, “relevant geographic market” and
“relevant product market” for determining as to what constitutes a “relevant market”.
The terms ‘relevant market’ and “relevant geographic market” have been defined in Sections 2 (r) and 2(s) of
the Act. For determining the “relevant geographic market”, the Commission shall have due regard to
all or any of the following factors, namely;
(a) regulatory trade barriers;
(b) local specification requirements;
(c) national procurement policies;
(d) adequate distribution facilities;
(e) transport costs;

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(f) language;
(g) consumer preferences;
(h) need for secure, regular supplies or rapid after-sales service.
Similarly, while determining ‘relevant product market’ the Commission shall have due regard to all or
any of the following factors namely;
(a) physical characteristics or end-use of goods;
(b) price of goods or service;
(c) consumer preferences;
(d) exclusion of in-house production;
(e) existence of specialized producers;
(f) classification of industrial products.
The prescription of parameters for determining “appreciable adverse effect” on competition of agreement,
“dominant position”, within “relevant market”, are intended to bring consistency and certainty in the working
of the Commission which has to consider all or any of the applicable factors, as the case may be. It is quite
apparent that any inquiry by the CCI will be a detailed exercise, which will not only involve gathering of
information in regard to technological or marketing factors but also the government policy which relate to the
trade or business in which the enterprise is involved beside global scenario especially with regard to
regulatory trade barriers including import-export policy, tariff and subsidy issues will also be taken into
account by the Commission.
Inquiry into Combination by Commission
The Commission under Section 20 of the Competition Act may inquire into the appreciable adverse effect
caused or likely to be caused on competition in India as a result of combination either upon its own
knowledge or information (suo motu) or upon receipt of notice under Section 6(2) relating to acquisition
referred to in Section 5(a) or acquiring of control referred to in Section 5(b) or merger or amalgamation
referred to in Section 5(c) of the Act. It has also been provided that an enquiry shall be initiated by the
Commission within one year from the date on which such combination has taken effect. Thus, the law has
provided a time limit within which suo moto inquiry into combinations can be initiated. This provision dispels
the fear of enquiry into combination between merging entities after the expiry of stipulated period.
On receipt of the notice under Section 6(2) from the person or an enterprise which proposes to enter into a
combination, it is mandatory for the Commission to inquire whether the combination referred to in that notice,
has caused or is likely to cause an appreciable adverse effect on competition in India.
The Commission shall have due regard to all or any of the factors for the purposes of determining
whether the combination would have the effect of or is likely to have an appreciable adverse effect
on competition in the relevant market, namely
(a) actual and potential level of competition through imports in the market;
(b) extent of barriers to entry into the market;
(c) level of combination in the market;
(d) degree of countervailing power in the market;
(e) likelihood that the combination would result in the parties to the combination being able to
significantly and sustainably increase prices or profit margins;
(f) extent of effective competition likely to sustain in a market;
(g) extent to which substitutes are available or are likely to be available in the market;
(h) market share, in the relevant market, of the persons or enterprise in a combination, individually
and as a combination;
(i) likelihood that the combination would result in the removal of a vigorous and effective competitor
or competitors in the market;
(j) nature and extent of vertical integration in the market;
(k) possibility of a failing business;
(l) nature and extent of innovation;
(m) relative advantage, by way of the contribution to the economic development, by any combination
having or likely to have appreciable adverse effect on competition;
(n) whether the benefits of the combination outweigh the adverse impact of the combination, if any.
The above yardsticks are to be taken into account irrespective of fact whether an inquiry is instituted, on
receipt of notice under Section 6(2) upon its own knowledge. The scope of assessment of adverse effect on
competition will be confined to the “relevant market”. Most of the facts enumerated in Section 20 (4) are
external to an enterprise. It is noteworthy that sub clause (n) of Section 20 (4) requires to invoke principles of
a “balancing”. It requires the Commission to evaluate whether the benefits of the combination outweigh the
adverse impact of the combination, if any. In other words if the benefits of the combination outweigh the
adverse effect of the combination, the Commission will approve the combination. Conversely, the
Commission may declare such a combination as void.
Reference by statutory authority

The term “statutory authority” has been defined in Section 2(w). If in the course of a proceeding before any
statutory authority, an issue is raised by any party that any decision which such authority has taken or
proposes to take, is or would be, contrary to the provisions of the Competition Act 2002, it may make a
reference in respect of such issue to the Commission and seek its opinion. The Commission shall, on receipt
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of the reference, after hearing the parties to the proceedings, give its opinion within 60 days of receipt of
such reference to such authority on the issues referred to it. The statutory authority shall thereafter pass
such order on the issues referred to the Commission as it deems fit. The statutory authority may, suo motu
make such reference in respect of such issue to the Commission. Likewise, the Commission either in the
course of proceedings before it or suo motu may make a reference for opinion to a statutory authority and
the latter has to render its opinion within 60 days of making a reference.
Meetings of Commission
Section 22 provides that the Commission shall meet at such times and places, and shall observe such rules
and procedure in regard to the transaction of business at its meetings as may be provided by regulations.
The Chairperson, if for any reason, is unable to attend a meeting of the Commission, the senior-most
Member present at the meeting, shall preside at the meeting. All questions which come up before any
meeting of the Commission shall be decided by a majority of the Members present and voting, and in the
event of an equality of votes, the Chairperson or in his absence, the Member presiding, shall have a second
or/casting vote. However, the quorum for such meeting shall be three Members.
Procedure for inquiry on complaints under Section 19

If the Commission is of the opinion that there exists a prima facie case, on receipt of an information from any
person, consumer, their association or trade association or on a reference from Central Government or State
Government or of a statutory authority or on its knowledge or information under Section 19, it shall direct the
Director General to cause an investigation to be made into the matter. The Director General shall investigate
into the matter and submit a report of its findings within the period as may be specified by the Commission. It
is, however, not binding on the Commission to accept the report of the Director General.
Where upon receipt of a reference or information, the Commission is of the opinion that there is no prima-
facie case, it shall pass an order dismissing the reference/information, as it deems fit and necessary.
Upon receipt of a report from the Director General, the Commission shall forward a copy thereof to (a) the
parties concerned or (b) Central Government or (c) State Government or (d) statutory authority as the case
may be. If the Director General, in relation to a matter referred to it, recommends that there is no
contravention of any of the provisions of the Act, the Commission shall give an opportunity of hearing to the
informant and after hearing, if the Commission agrees with the recommendation of the Director General, it
shall dismiss the information. According to Section 26(7) if, after hearing information provider, the
Commission is of the opinion that further inquiry is called for, it shall direct the enquiry to proceed further.
Where the report of the Director General relates to matter referred to Commission by the Central
Government or a State Government or a statutory authority and the report contains recommendation that
there is no contravention of the provisions of the Act, the Commission shall invite the comments of the
Central Government or the State Government or statutory authority, as the case may be, on such report. On
receipt of the comments, if there is no prima-facie case, in the opinion of the Commission the Commission
shall return the reference. However, if the Commission feels that there is a prima-facie case it shall proceed
with a reference.
Section 26(9) provides that the Commission on receipt of recommendation of Director General that there is
contravention of any of the provisions of the Act, and a further inquiry is called for, shall inquire into such
contravention in accordance with the provisions of the Act.
The provisions of the Section indicate that it is mandatory that information or reference received or a matter
which comes to the knowledge of the Commission regarding alleged violation of the provisions of the Act,
must be referred to the Director General for an investigation in the matter. A copy of the report of the Director
General is required to be sent to the information provider or to the Central Government or State Government
or a statutory authority, as the case may be, for their comments and an opportunity of hearing is required to
be given to the parties as this is warranted by the principles of natural justice. Where the Director General
recommends that there is contravention of any of the provisions of the Act, and that the Commission is of
opinion that further inquiry is called for, it shall institute an inquiry into the matter and pass a reasoned order.
The Commission may or may not subscribe to the recommendations of the Director General.
Orders by Commission after inquiry into agreements or abuse of dominant position

Section 27 envisages that the Commission after any inquiry into agreement entered into by any enterprise or
association of enterprises or person or association of persons, or an inquiry into abuse of dominant position
may pass all or any of the following orders, namely,
(i) direct that such agreement, or abuse of dominant position shall be discontinued and such
agreement, which is in contravention of Section 3 shall not be re-entered or the abuse of dominant
position in contravention of Section 4 shall be discontinued, as the case may be. The direction to
discontinue and not to recur is commonly known as “Cease & desist” order.
(ii) the Commission may impose penalty not exceeding ten percent of the average turnover of last three
preceding financial years, upon each of person or enterprises which are parties to such agreement
in contravention of Section 3 or are abusing dominant position within meaning of Section 4.
In case any agreement which is prohibited by Section 3 has been entered into by any cartel, the
Commission may impose upon each producer, seller, distributor, trader or service provider
participating in that cartel, a penalty up to three times of its profits for each year of the continuance
of such agreement whichever is higher.
(iii) The Commission may direct that the agreements shall stand modified to the extent and in the
manner as specified in the order.
(iv) The Commission may direct the enterprises concerned to comply with such other orders and
directions, including payment of cost, if any, as it deems fit.
(v) to pass such order or issue such directions as it may deem fit.
Division of enterprise enjoying dominant position

The Commission may, notwithstanding anything contained in any other law for the time being in force, by
order in writing, direct division of an enterprise enjoying dominant position to ensure that such enterprise or
group does not abuse its dominant position.
The order of the Commission referred to above may provide for all or any of the following matters, namely
(a) the transfer or vesting of property, rights, liabilities or obligations;
(b) the adjustment of contracts either by discharge or reduction of any liability or obligation or otherwise;
(c) the creation, allotment, surrender or cancellation of any shares, stocks or securities;
(d) the formation or winding up of an enterprise or the amendment of the memorandum of association
or articles of association or any other instruments regulating the business of any enterprise;
(e) the extent to which, and the circumstances in which, provisions of the order affecting an enterprise
may be altered by the enterprise and the registration thereof;
(f) any other matter which may be necessary to give effect to the division of the enterprise or group.
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Procedure for investigation of combination

The procedure for investigation by the Commission has been stipulated under Section 29 of the Act. It
involves following stages -
(i) The Commission first has to form a prima facie opinion that a combination is likely to cause, or has
caused an appreciable adverse effect on competition within the relevant market in India. Further,
when the Commission has come to such a conclusion then it shall proceed to issue a notice to the
parties to the combination, calling upon them to show cause why an investigation in respect of such
combination should not be conducted;
(ii) After receipt of the response of the parties to the combination may call for the report of the Director
General.
(iii) When pursuant to response of parties or on receipt of report of the Director General whichever is
later, the Commission prima-facie is of the opinion that the Combination is likely to cause an
appreciable adverse effect on competition in relevant market, it shall, within seven days direct the
parties to the combination to publish within ten working days, the details of the combination, in such
manner as it thinks appropriate so as, to bring to the information of public and persons likely to be
affected by such combination.
(iv) The Commission may invite any person affected or likely to be affected by the said combination, to
file his written objections within fifteen working days of the publishing of the public notice, with the
Commission for its consideration.
(v) The Commission may, within fifteen working days of the filing of written objections, call for such
additional or other information as it deem fit from the parties to the said combination and the
information shall be furnished by the parties above referred within fifteen days from the expiry of the
period notified by the Commission.
(vi) After receipt of all the information and within forty-five days from expiry of period for filing further
information, the Commission shall proceed to deal with the case, in accordance with provisions
contained in Section 31 of the Act.
Thus, the provisions of Section 29 provide for a specified timetable within which the parties to the
combination or parties likely to be affected by the combination are required to submit the information or
further information to the Commission to ensure prompt and timely conduct of the investigation. It further
imposes on Commission a time limit of forty-five working days from the receipt of additional or other
information called for by it under sub-Section (4) of Section 29 for dealing with the case of investigation into a
combination, which may have an adverse effect of the competition.
Inquiry into disclosures under Section 6(2)

Section 6(2) casts an allegation on any person or enterprise, who or which proposes to enter into
combination, shall give notice to the Commission, in the form as may be specified, and the fee which may be
determined, by regulations, disclosing the details of the proposed combination within thirty days of—
(i) approval of the proposal relating to merger or amalgamation by the board of directors of the
enterprises concerned with such merger or amalgamation;
(ii) execution of any agreement or other document for acquisition referred to in Section 5(a) or
acquiring of control referred to in Section 5(b).
Non-filing of notice attracts penalty in terms of Section 43A of the Act.

The newly inserted section 6(2A) envisages that no combination shall come into effect until two hundred and
ten days have passed from the day on which notice has been given to Commission or the Commission has
passed orders, whichever is earlier.
Upon receipt of such notice, the Commission shall examine such notice and form its prima facie opinion as to
whether the combination has, or is likely to have, an appreciable adverse effect on the competition in the
relevant market in India.
Orders of Commission on Certain Combinations

The Commission, after consideration of the relevant facts and circumstances of the case under investigation,
by it under Sections 28 or 30 and assessing the effect of any combination on the relevant market in India,
may pass any of the written orders indicated herein below. Where the Commission comes to a conclusion
that any combination does not, or is not likely to, have an appreciable adverse effect on the Competition in
relevant market in India, it may, approve that Combination.
(i) In the case where the Commission is of the opinion that the combination has, or is likely to have an
adverse effect on competition, it shall direct that the combination shall not take effect.
(ii) Where the Commission is of the opinion that adverse effect which has been caused or is likely to be
caused on competition can be eliminated by modifying such Combination then it shall direct the
parties to such combination to carry out necessary modifications to the Combination.
(iii) The parties accepting the proposed modification shall carry out such modification within the period
specified by the Commission.
(iv) Where the parties who have accepted the modification, fail to carry out such modification within the
period specified by the Commission, such combination shall be deemed to have an appreciable
adverse effect on competition and shall be dealt with by the Commission in accordance with the
provisions of the Act.
(v) If the parties to the Combination do not accept the proposed modification such parties may within thirty
days of modification proposed by the Commission, submit amendment to the modification proposed
by the Commission.
(vi) If the Commission agrees with the agreement submitted by the parties it shall, by an order approve
the combination.
(vii) If the Commission does not accept the amendment then, parties shall be allowed a further period of
thirty days for accepting the amendment proposed by the Commission.
(viii) Where the parties to the combination fail to accept the modification within thirty days, then it shall be
deemed that the combination has an appreciable adverse effect on Competition and will be dealt
with in accordance with the provisions of the Act.
(ix) Where the Commission directs under Section 31 (2) that the combination shall not take effect or it
has, or is likely to have an appreciable adverse effect, it may order that,
(a) the acquisition referred to in Section 5 (a); or
(b) the acquiring of control referred to in Section 5(b); or
(c) the merger or the amalgamation referred to in Section 5(c) shall not be given effect to by the
parties.
As per proviso the Commission may, if it considers appropriate, frame a scheme to implement
its order in regard to the above matters under Section 31(10).
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(x) A deeming provision has been introduced by Section 31(11). It provides that, if the Commission
does not, on expiry of a period of two hundred ten days from the date of filing of notice under
Section 6(2) pass an order or issue any direction in accordance with the provisions of Section 29(1)
or Section 29(2) or Section 29(7), the combination shall be deemed to have been approved by the
Commission. In reckoning the period of two hundred ten days, the period of thirty days specified in
Section 29(6) and further period of thirty working days specified in Section 29(8) granted by
Commission shall be excluded.
(xi) Further more where extension of time is granted on the request of parties the period of two hundred
ten days shall be reckoned after the deducting the extended time granted at the request of the parties.
(xii) Where the Commission has ordered that a combination is void, as it has an appreciable adverse
effect on competition, the acquisition or acquiring of control or merger or amalgamation referred to
in Section 5, shall be dealt with by other concerned authorities under any other law for the time
being in force as if such acquisition or acquiring of control or merger or amalgamation had not taken
place and the parties to the combination shall be dealt with accordingly.
(xiii) Section 29(14) makes it clear that nothing contained in Chapter IV of the Act shall affect any
proceeding initiated or may be initiated under any other law for the time being in force. It implies that
provisions of this Act are in addition to and not in derogation of provisions of other Acts.
Thus, approval under one law does not make out a case for approval under another law.
Acts taking place outside India but having an effect on Competition in India
Section 32 extends the jurisdiction of Competition Commission of India to inquire and pass orders in
accordance with the provisions of the Act into an agreement or dominant position or combination, which is
likely to have, an appreciable adverse effect on competition in relevant market in India, notwithstanding that,
(a) an agreement referred to in Section 3 has been entered into outside India; or
(b) any party to such agreement is outside India; or
(c) any enterprise abusing the dominant position is outside India; or
(d) a combination has taken place outside India; or
(e) any party to combination is outside India; or
(f) any other matter or practice or action arising out of such agreement or dominant position or
combination is outside India.
The above clearly demonstrates that acts taking place outside India but having an effect on competition in
India will be subject to the jurisdiction of Commission. The Competition Commission of India will have
jurisdiction even if both the parties to an agreement are outside India but only if the agreement, dominant
position or combination entered into by them has an appreciable adverse effect on competition in the
relevant market of India.
Appearance before Commission

As per Section 35 of the Act, following persons are entitled to appear before the Commission
(i) a complainant; or
(ii) a defendant; or
(iii) the Director General
They may either appear in person or authorise any of the following:

(a) a chartered accountant as defined in Section 2(1)(b) of Chartered Accountants Act, 1949 (38 of
1949) who has obtained a certificate of practice; or
(b) a company secretary as defined in Section 2(1)(c) of the Company Secretaries Act, 1980 (56 of
1980) and who has obtained a certificate of practice;
(c) a cost accountant as defined in Section 2(1)(b) of the Cost and Works Accountants Act, 1959 (23 of
1959) and who has obtained a certificate of practice;
(d) a legal practitioner that is an advocate, vakil or an attorney of any High Court including a pleader in
practice.
The above provisions unambiguously state that a ‘Company Secretary in Practice’ is entitled to
represent an informant or a defendant or Director General. A Company Secretary in Practice
can also get himself empanelled with the Director General to prosecute his cases before the
Commission.
Power of Commission to regulate its own procedure

The Competition Commission of India has been empowered to lay down its own procedure and regulations.
It is not bound by the procedure laid down by the Code of Civil Procedure, 1908 but shall have to observe
the principles of natural justice and subject to the provisions of the Act. The Competition Commission of India
shall also be subject to the rules made by the Central Government. Section 36(2) makes it clear that the
Commission shall have the same powers as are vested in a civil court under the Code of Civil Procedure,
1908 while trying the suit, in respect of the following matters, namely:
(a) summoning and enforcing the attendance of any person and examining him on oath;
(b) requiring the discovery and production of documents;
(c) receiving evidence on affidavits;
(d) issuing commissions for the examination of witnesses or documents;
(e) subject to the provisions of Sections 123 and 124 of the Indian Evidence Act, 1872, requisitioning
any public record or document or copy of such record or document from any office;
In terms of Section 36(3), the Commission may call upon such experts, from the field of economics,
commerce, accountancy, international trade or from any discipline as it deems necessary to assist the
Commission in the conduct of any enquiry by it.
In terms of Section 36(4), the Commission may direct any person –

(a) to produce before the Director General or the Secretary or an officer authorized by it, such books, or
other documents in the custody or under the control of such person so directed as may be specified
or described in the direction, being documents relating to any trade, the examination of which may
be required for the purposes of the Act;
(b) to furnish to the Director General or the Secretary or any other officer authorized by it, as respects
the trade or such other information as may be in his possession in relation to the trade carried on by
such person, as may be required for the purposes of the Act.
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The Competition Commission in thus empowered to appoint experts, from the fields of economics,
commerce, accountancy, international trade or from any other discipline as it deems necessary, to assist in
the conduct of any inquiry or proceeding before it.
As stated earlier, Director General is an important functionary assisting the Commission and the Commission
may ask the Director General to investigate into any trade practice and for the purpose of examination of
books, or account and other document of the parties concerned. The Director General is also vested with all
the powers as are conferred upon the Commission under Section 36(2) of Act.
Ratification of orders
The Commission may amend any order passed by it under the provisions of this Act with a view to rectifying
any mistake apparent from the record. Section 38(2) provides that subject to other provisions of this Act, the
Commission may make –
(a) an amendment of an order of its own motion;
(b) an amendment for rectifying any mistake apparent from record, which has been brought to its notice
by any party to the order.
An explanation below the Section clarifies that while rectifying any mistake apparent from the record, the
Commission shall not amend substantive part of the order passed by it under the provisions of this Act.
Execution of Orders of the Commission Imposing Monetary penalty

Section 39 provides that if a person fails to pay any monetary penalty imposed on him under the Act, the
Commission shall proceed to recover such penalty, in such manner as may be specified by the regulations.
In a case where the Commission is of the opinion that it would be expedient to recover the penalty imposed
under the Act in accordance with the provisions of the Income-tax Act, 1961, it may make a reference to this
effect to the concerned income-tax authority under that Act for recovery of the penalty as tax due under the
said Act.
Where a reference has been made by the Commission under sub-section (2) for recovery of penalty, the
person upon whom the penalty has been imposed shall be deemed to be the assessee in default under the
Income Tax Act, 1961 and the provisions contained in sections 221 to 227, 228A, 229, 231 and 232 of the
said Act and the Second Schedule to that Act and any rules made there under shall, in so far as may be,
apply as if the said provisions were the provisions of this Act and referred to sums by way of penalty imposed
under this Act instead of to income-tax and sums imposed by way of penalty, fine, and interest under the
Income–tax Act, 1961 and to the Commission instead of the Assessing Officer.
Explanation 1 – Any reference to sub-section (2) or sub-section (6) of section 220 of the income-tax Act,
1961 (43 of 1961), in the said provisions of that Act or the rules made thereunder shall be construed as
references to sections 43 to 45 of this Act.
Explanation 2 – The Tax Recovery Commissioner and the Tax Recovery Officer referred to in the Income-tax
Act, 1961 shall be deemed to be the Tax Recovery Commissioner and the Tax Recovery Officer for the
purposes of recovery of sums imposed by way of penalty under this Act and reference made by the
Commission under sub-section (2) would amount to drawing of a certificate by the Tax Recovery Officer as
far as demand relating to penalty under this Act.
Explanation 3– Any reference to appeal in Chapter XVIID and the Second Schedule to the Income-tax Act,
1961 shall be construed as a reference to appeal before the Competition Appellate Tribunal under section
53B of this Act.
It would be noted that Commission may by its Regulations has been empowered to evolve procedure of
recovering monetary penalty. It may also make reference to Income Tax Authority for recovering of penalty
as tax due under the said Act.
As per Section 39 every order passed by the Commission under this Act shall be executed in the same
manner as if it were a decree or order made by the High Court or the Principal Civil Court in any suit pending
therein.
It shall be lawful for the Commission to send, in event of its inability to execute it such order to the High Court
or to the Principal Civil Court, as the case may be, within the limits of whose jurisdiction—
(a) in the case of an order passed against any company or firm; the registered office or the sole or
principal office of the business of company in India or where a company also has a subordinate
office, that subordinate office, is situated;
(b) in the case of an order passed against any other person, the place, where he voluntarily resides of
carries on business or personally works for gain, is situated.
There upon the court to which the order is so sent shall execute the order as if it were a decree or order sent
to it for execution.
Duties of Director General

The Act provides that the Director General when so directed by the Commission, is to assist the Commission
in investigation into any contravention of the provisions of this Act. The Director General is bound to comply
with such a direction to render requisite assistance to the Commission.
The Director General, in order to effectively discharge his functions, has been given the same powers as are
conferred upon the Commission under section 36(2). Under section 36(2) the Commission is having same
powers as are vested in Civil Court under the Code of Civil Procedure (1908) while trying a suit, in respect of
the following matters, namely;
(c) receiving evidence on affidavits;
(d) issuing commissions for the examination of witnesses or documents;
(e) subject to the provisions of Sections 123 and 124 of the Indian Evidence Act, 1872, requisitioning
Without prejudice to the above powers, the provisions of Sections 240 and 240A of the Companies Act, 1956
, so far as may be, shall apply to an investigation made by the Director General or by a person authorised by
him, as they apply to an inspector under the Companies Act 1956. This power includes search and seizure of
the record of any person in respect of which an investigation has been directed by the Commission. It has
been provided that wherever the approval of the Central Government is required, the same shall be given by
the Commission and the word ‘magistrate’ appearing in Section 240A shall be construed as the Chief
Metropolitan Magistrate.
Penalties
The Competition Act prescribes penalties for contravention of orders of the Commission. As per Section 42,
the Commission may cause an inquiry to be made into compliance of its orders or directions and 
(a) if any person, without any reasonable cause, fails to comply with any order of the Commission, or
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condition or restriction subject to which any approval, sanction, direction or exemption in relation to
any matter has been accorded, given, made or granted under this Act; or
(b) if any person fails to pay the penalty imposed under the Act,
he shall be punishable with imprisonment for a term which may extend to three years or with fine which may
extend to rupees twenty five crores or with both, as the Chief Metropolitan Magistrate may deem fit. The
Chief Metropolitan Magistrate, Delhi, however, shall not take cognizance of any offence save as a complaint
filed by Commission or any of its officers authorized by it.
Compensation in case of Contravention of Orders of commission

Section 42A provides that without prejudice to the provisions of this Act, any person may make an
application to the Appellate Tribunal for an order for the recovery of compensation from any enterprise for
any loss or damage shown to have been suffered, by such person as a result of the said enterprise violating
directions issued by the Commission or contravening, without any reasonable ground, any decision or order
of the Commission issued under sections 27, 28, 31, 32 and 33 or any condition or restriction subject to
which any approval, sanction, direction or exemption in relation to any matter has been accorded, given,
made or granted under this Act or delaying in carrying out such orders or directions of the Commission.
Penalty for failure to comply with directions of Commission and Director General
Section 43 of the Act provides that if any person fails to comply, without reasonable cause, with a direction
given by the Commission under Sub-sections (2) and (4) of section 36; or the Director General while
exercising powers referred to in sub-section (2) of section 41, such person shall be punishable with fine
which may extend to rupees one lakh for each day during which such failure continues subject to a maximum
of rupees one crore, as may be determined by the Commission
Power to impose penalty for non-furnishing of information on combination

Section 43A provides that if any person or enterprise who fails to give notice to the Commission under sub-
section(2) of section 6, the Commission shall impose on such person or enterprise a penalty which may
extend to one per cent of the total turnover or the assets, whichever is higher, of such a combination.
Thus, failure to file notice of combination falling under Section 5 attract deterrent penalty.
Penalty for making false statement

Section 44 provides that If any person, being a party to a combination, makes a statement which is false in
any material particular, or knowing it to be false; or omits to state any material particular knowing it to be
material, such person shall be liable to a penalty which shall not be less than rupees fifty lakhs but which
may extend to rupees one crore, as may be determined by the Commission.
Power to impose lesser penalty

If any producer, seller, distributor, trader or service provider included in any cartel, which is alleged to have
violated Section 3, has made a full and true disclosure in respect of alleged violations and such a disclosure
is vital, the Commission may impose upon him a lesser penalty than as prescribed under the Act or rules or
regulations.
However, the lesser penalty shall not be imposed where before making such disclosure, the report of
Director General under Section 26 has been received in the Commission. Further, the lesser penalty shall be
imposed only in respect of the producer, seller, distributor, trader or service provider included in the cartel,
who has made a full, true and vital disclosures under this Section. Any producer, seller, trader or service
provider included in the cartel shall also be liable to imposition of penalty, if in the course of proceedings,
had,
(a) not complied with the condition on which the lesser penalty was imposed by the Commission; or
(b) given false evidence; or
(c) the disclosure made is not vital.
The lesser penalty is for a member of a ring who breaks the rank. There is no provision to provide any
protection or incentive to a whistle blower, which is conferred upon Authorities in contemporary legislations
abroad.
The Act does not vest power in the Commission to compound an offence as was the position under the
MRTP Act. It is viewed that long drawn investigation and enquiries could be arrested by provision such as
compounding which allows an offence to be settled quickly. The Commission is also not vested with power to
contempt.
Contravention by Companies
A company means a body corporate and includes a firm or other association of individuals; director, in
relation to a firm, means a partner in the firm for the purposes of penalties in connection with contravention of
the provisions of the Act by companies.
Where any rule, regulation, order made by the Commission or any direction issued thereunder is
contravened by a company, every person who, at the time the contravention was committed, was in charge,
and was responsible to the company for conducting business of the company, as well as the company, shall
be deemed to be guilty of the contravention and shall be liable to be proceeded against and punished.
However it will be a good defence by a person liable to any punishment if he proves that the contravention
was committed without his knowledge or that he has exercised all due diligence to prevent the commission of
an offence.
Where a contravention of any of the provisions of this Act or any rule, regulation, order made or direction issued
thereunder has been committed by a company and it is proved that contravention has taken place with the
consent or connivance of, or it is attributable to any neglect on the part of, any director, manager, secretary or
other officer of the company, such director, manager, secretary or other officer shall also be deemed to be
guilty of the contravention and shall be liable to be proceeded against and punished accordingly.
The word company in this Section, has been used in a wider sense and also includes a ‘firm’ or an
‘association of persons’. Though the word ‘director’ is normally used in a company, in the light of the wider
definition, the term director is interpreted to include a partner of the firm. The company being a legal person,
its affairs are conducted by a board of directors, manager, secretary or other officer, therefore, according to
Section 48 (2) such director, manager, secretary or other officer, in addition to the company itself shall be
deemed to be liable to be proceeded against for contravention of any provisions of this Act or any rule,
regulation, order made or direction issued thereunder by the Commission or the Director General of
Investigation.
Competition Advocacy
Under Section 49 the Central Government/State Government may seek the opinion of the CCI on the
possible effects of the policy on competition or any other matter. In this context, Section 49 envisages that
while formulating a policy on the competition, the Government may make a reference to the Commission for
its opinion on possible effect of such a policy on the competition, or any other matter.
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On receipt of such a reference, the Commission shall, give its opinion on it to the Central Government/State
Government, within sixty days of making such a reference and the latter may formulate the policy as it
deems fit. The role of the Commission is advisory and the opinion given by the Commission shall not be
binding upon the Central Government/State Government in formulating such a policy. The Commission is
also empowered to take suitable measures for the
(a) promotion of competition advocacy;
(b) creating awareness about the competition; and
(c) imparting training about competition issues.
The creating awareness about benefits of competition and imparting training in competition issues is
expected to generate conducive environment to promote and foster competition, which is sine-qua non for
accelerating economic growth.
Finance, Accounts and Audit

Grants by Central Government
The Central Government may make to the Commission grants of such sums of money as it may think fit for
being utilised for the purposes of the Act. Such grant is to be made after due appropriation made by the
Parliament.
Constitution of Fund
The Act provides for the constitution of a fund called the “Competition Fund” for meeting the establishment
and other expenses of the Competition Commission in connection with the discharge of its functions and for
the purposes of this Act. The following shall be credited to the “Competition Fund”, -
(a) all government grants received by the commission;
(b) Omitted
(c) the fees received under the Act;
(d) the interest on the amounts accrued on the monies referred under clauses (a) to (c).
Fee realized alongwith notice disclosing combination shall form part of ‘Competition Fund’.
The Fund shall be administered by a Committee of such Members of the Commission, as may be
determined by the Chairperson and the Committee so appointed, shall spend monies out of the Fund only for
the objects for which the Fund has been constituted.
Accounts and Audit

Proper accounts and other relevant records shall be maintained by the Commission and an annual statement
of accounts shall be prepared by it in prescribed form in consultation with the Comptroller and Auditor
General of India (CAG).The CAG shall specify the intervals within which the accounts of the Commission
shall be audited by him.
Explanation to Section 52(2) clarifies that the orders passed by the Commission, being matters appealable to
the Supreme Court, shall not be subject to audit by the CAG. The expenses, if any, incurred in connection
with such audit shall be payable by the Commission to the CAG.
The CAG or any person appointed by him in connection with the audit of the accounts of the Commission
shall have same rights, privileges and authority in connection with such audit as CAG has in connection with
the audit of Government accounts and, shall have the right to demand the production of books, accounts,
connected vouchers and other documents and papers and to inspect any of the offices of the Commission.
Only accounts as certified by the CAG and any other person authorised by him in this behalf together with
the audit report thereon shall be forwarded to the Central Government and the Government shall cause it to
be laid before each House of Parliament.
Furnishing of Returns, etc., to Central Government

The Commission shall furnish to the Central Government such returns and statements and such particulars
in regard to any proposed or existing measures for promotion of competition advocacy, creating awareness
and imparting training about competition issues, in such form and such manner as the Central Government
may prescribe. An annual report giving a true and full account of activities of the Commission during the
previous year shall be prepared once in every year by the Commission and submitted to the Central
Government.
A copy of the annual report of the Commission received by the Government shall cause to be laid by the
Central Government before each House of Parliament.
COMPETITION APPELLATE TRIBUNAL

Section 53A empowers the Central Government to establish, by notification, an Appellate Tribunal to be
known as Competition Appellate Tribunal –
(a) to hear and dispose of appeals against any direction issued or decision made or order passed by
the Commission under sub-sections (2) and (6) of section 26, section 27, section 28, section 31,
section 32, section 33, section 38, section 39, section 43, section 43A, section 44, section 45 or
section 46 of the Act;
(b) to adjudicate on claim for compensation that may arise from the findings of the Commission or the
orders of the Appellate Tribunal in an appeal against any finding of the Commission or under
section 42A or under sub-section(2) of section 53Q of this Act, and pass orders for the recovery of
compensation under section 53N of this Act.
APPEAL TO APPELLATE TRIBUNAL

The Central Government or the State Government or a local authority or enterprise or any person, aggrieved
by any direction, decision or order referred to in clause (a) of section 53A may prefer an appeal to the
Appellate Tribunal. Every appeal under sub-section (1) shall be filed within a period of sixty days from the
date on which a copy of the direction or decision or order made by the Commission is received by the
Central Government or the State Government or a local authority or enterprise or any person referred to in
that sub-section and it shall be in such form and be accompanied by such fee as may be prescribed.
However, the Appellate Tribunal may entertain an appeal after the expiry of the said period of sixty days if it
is satisfied that there was sufficient cause for not filing it within that period.
On receipt of an appeal under sub-section (1), the Appellate Tribunal may, after giving the parties to the
appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or
setting aside the direction, decision or order appealed against. The Appellate Tribunal shall send a copy of
every order made by it to the Commission and the parties to the appeal. The appeal filed before the
Appellate Tribunal under sub-section (1) shall be dealt with by it as expeditiously as possible and endeavour
shall be made by it to dispose of the appeal within six months from the date of receipt of the appeal.
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Composition of Appellate Tribunal

The Appellate Tribunal shall consist of a Chairperson and not more than two other members to be appointed
by the Central Government.
Qualifications for appointment of Chairperson and Members of Appellate Tribunal

Section 53D provides that the Chairperson of the Appellate Tribunal shall be a person, who is, or has been a
Judge of the Supreme Court or the Chief Justice of a High Court.
A member of the Appellate Tribunal shall be a person of ability, integrity and standing having special
knowledge of, and professional experience of not less than twenty five years in, competition matters
including competition law and policy, 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 Appellate Tribunal.
Term of office of Chairperson and Members of Appellate Tribunal

The Chairperson or a member of the Appellate Tribunal shall hold office as such for a term of five years from
the date on which he enters upon his office, and shall be eligible for re-appointment. However, no
Chairperson or other member of the Appellate Tribunal shall hold office as such after he has attained, -
(a) in the case of the Chairperson, the age of sixty-eight years;
(b) in the case of any other member of the Appellate Tribunal, the age of sixty-five years.
Resignation of Chairperson and Members of Appellate Tribunal

The Chairperson or a member of the Appellate Tribunal may, by notice in writing under his hand addressed
to the Central Government, resign his office. However, the Chairperson or a member of the Appellate
Tribunal shall, unless he is permitted by the Central Government to relinquish his office sooner, continue to
hold office until the expiry of three months from the date of receipt of such notice or until a person duly
appointed as his successor enters upon his office or until the expiry of his term of office, whichever is the
earliest.
Member of Appellate Tribunal to act as its Chairperson in certain cases

In the event of the occurrence of any vacancy in the office of the Chairperson of the Appellate Tribunal by
reason of his death or resignation, the senior-most Member of the Appellate Tribunal shall act as the
Chairperson of the Appellate Tribunal until the date on which a new Chairperson appointed in accordance
with the provisions of this Act to fill such vacancy enters upon his office.
When the Chairperson of the Appellate Tribunal is unable to discharge his functions owing to absence,
illness or any other cause, the senior-most member or, as the case may be, such one of the Members of the
Appellate Tribunal, as the Central Government may, by notification, authorize in this behalf, shall discharge
the functions of the Chairperson until the date on which the Chairperson resumes his duties.
Restriction on employment of Chairperson and other Members of Appellate Tribunal in

certain cases
The Chairperson and other members of the Appellate Tribunal shall not, for a period of two years from the
date on which they cease to hold office, accept any employment in, or connected with the management or
administration of, any enterprise which has been a party to a proceeding before the Appellate Tribunal under
the Act. However, nothing contained in this section shall apply to any employment under the Central
Government or a State Government or local authority or in any statutory authority or any corporation
established by or under any Central, State or Provincial Act or a Government Company as defined in section
617 of the Companies Act,1956.
Awarding compensation
Section 53N provides that without prejudice to any other provisions contained in this Act, the Central
Government or a State Government or a local authority or any enterprise or any person may make an
application to the Appellate Tribunal to adjudicate on claim for compensation that may arise from the findings
of the Commission or the orders of the Appellate Tribunal in an appeal against any findings of the
Commission or under section 42A or under sub-section(2) of section 53Q of the Act, and to pass an order for
the recovery of compensation from any enterprise for any loss or damage shown to have been suffered, by
the Central Government or a State Government or a local authority or any enterprise or any person as a
result of any contravention of the provisions of Chapter II, having been committed by enterprise.
Every application made under sub-section (1) shall be accompanied by the findings of the Commission, if
any, and also be accompanied with such fees as may be prescribed. The Appellate Tribunal may, after an
inquiry made into the allegations mentioned in the application made under sub-section (1), pass an order
directing the enterprise to make payment to the applicant, of the amount determined by it as realisable from
the enterprise as compensation for the loss or damage caused to the applicant as a result of any
contravention of the provisions of Chapter II having been committed by such enterprise. However, the
Appellate Tribunal may obtain the recommendations of the Commission before passing an order of
compensation.
Where any loss or damage referred to in sub-section (1) is caused to numerous persons having the same
interest, one or more of such persons may, with the permission of the Appellate Tribunal, make an
application under that sub-section for and on behalf of, or for the benefit of, the persons so interested, and
thereupon, the provisions of rule 8 of Order 1 of the First Schedule to the Code of Civil Procedure, 1908,
shall apply subject to the modification that every reference therein to a suit or decree shall be construed as a
reference to the application before the Appellate Tribunal and the order of the Appellate Tribunal thereon.
Procedures and powers of Appellate Tribunal

Section 53O provides that the Appellate Tribunal shall not be bound by the procedure laid down in the Code
of Civil Procedure, 1908 (5 of 1908), but shall be guided by the principles of natural justice and, subject to
the other provisions of this Act and of any rules made by the Central Government, the Appellate Tribunal
shall have power to regulate its own procedure including the places at which they shall have their sittings.
The Appellate Tribunal shall have, for the purposes of discharging its functions under this Act, the same
powers as are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908) while trying a suit in
respect of the following matters, namely:
(c) receiving evidence on affidavit;
(d) subject to the provisions of sections 123 and 124 of the Indian Evidence Act, 1872, requisitioning
(e) issuing commissions for the examination of witnesses or documents;
(f) reviewing its decisions;
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(g) dismissing a representation for default or deciding it ex parte;

(h) setting aside any order of dismissal of any representation for default or any order passed by it ex
parte;
(i) any other matter which may be prescribed.
Every proceedings before the Appellate Tribunal shall be deemed to be judicial proceedings within the
meaning of sections 193 and 228, and for the purposes of section 196, of the Indian Penal Code and the
Appellate Tribunal shall be deemed to be a civil court for the purposes of section 195 and Chapter XXVI of
the Code or Criminal Procedure, 1973.
Execution of orders of Appellate Tribunal

Every order made by the Appellate Tribunal shall be enforced by it in the same manner as if it were a decree
made by a court in a suit pending therein, and it shall be lawful for the Appellate Tribunal to send, in case of
its inability to execute such order, to the court within the local limits of whose jurisdiction,-
(a) in the case of an order against a company, the registered office of the company is situated; or
(b) in the case of an order against any other person, place where the person concerned voluntarily
resides or carries on business or personally works for gain, is situated.
The Appellate Tribunal may transmit any order made by it to a civil court having local jurisdiction and such
civil court shall execute the order as if it were a decree made by that court.
Contravention of orders of Appellate Tribunal

Without prejudice to the provisions of this Act, if any person contravenes, without any reasonable ground,
any order of the Appellate Tribunal, he shall be liable for a penalty of not exceeding rupees one crore or
imprisonment for a term up to three years or with both as the Chief Metropolitan Magistrate, Delhi may deem
fit. However, the Chief Metropolitan Magistrate, Delhi shall not take cognizance of any offence punishable
under this sub-section, save on a complaint made by an officer authorized by the Appellate Tribunal.
Without prejudice to the provisions of this Act, any person may make an application to the Appellate Tribunal
for an order for the recovery of compensation from any enterprise for any loss or damage shown to have
been suffered, by such person as a result of the said enterprise contravening, without any reasonable
ground, any order of the Appellate Tribunal or delaying in carrying out such orders of the Appellate Tribunal.
Right to legal representation

A person preferring an appeal to the Appellate Tribunal may either appear in person or authorize one or
more chartered accountants or company secretaries or cost accountants or legal practitioners or any of its
officers to present his or its case before the Appellate Tribunal.
The Central Government or a State Government or a local authority or any enterprise preferring an appeal to
the Appellate Tribunal may authorize one or more chartered accountants or company secretaries or cost
accountants or legal practitioners or any of its officers to act as presenting officers and every person so
authorized may present the case with respect to any appeal before the Appellate Tribunal.
The Commission may authorize one or more chartered accountants or company secretaries or cost
accountants or legal practitioners or any of its officers to act as presenting officers and every person so
authorized may present the case with respect to any appeal before the Appellate Tribunal.
Explanation – The expressions “chartered accountant” or “company secretary” or “cost accountant” or “legal
practitioner” shall have the meanings respectively assigned to them in the Explanation to section 35.
Appeal to Supreme Court

The Central Government or any State Government or the Commission or any statutory authority or any local
authority or any enterprise or any person aggrieved by any decision or order of the Appellate Tribunal may
file an appeal to the Supreme Court within sixty days from the date of communication of the decision or order
of the Appellate Tribunal to them. The Supreme court may, if it is satisfied that the applicant was prevented
by sufficient cause from filing the appeal within the said period, allow it to be filed after the expiry of the said
period of sixty days.
Power to Punish for contempt

The Appellate Tribunal shall have, and exercise, the same jurisdiction, powers and authority in respect of
contempt of itself as a High Court has and may exercise and, for this purpose, the provisions of the
Contempt of Courts Act, 1971 (70 of 1971) shall have effect subject to modifications that,—
(a) the reference therein to a High Court shall be construed as including a reference to the Appellate
Tribunal;
(b) the references to the Advocate-General in section 15 of the said Act shall be construed as a
reference to such Law Officer as the Central Government may, by notification, specify in this behalf.
Miscellaneous
Power to exempt
The Central Government may, by notification exempt from the application of the Act, or any provision
thereof—
(a) any class of enterprises if such exemption is necessary in the interest of security of the State or
public interest;
(b) any practice or agreement arising out of and in accordance with any obligation assumed by India
under any treaty, agreement or convention with any other country or countries;
(c) any enterprise, which performs a sovereign function on behalf of the Central Government or a State
Government.
Thus, the power to grant exemption can be invoked by the Central Government in specified circumstances
and conditions.
Where any enterprise is engaged in activities, which includes any activity relatable to the sovereign functions
of the Government, exemption may be granted by the Central Government only in respect of the activity
relatable to the sovereign functions.
Power of Central Government to issue directions

The Central Government may give in writing to the Commission such directions on questions of policy, other
than those relating to technical and administrative matters and the Commission shall be bound by such
directions. The Commission shall be given an opportunity to express its views to the Central Government
before any direction is given by the Government to the Commission. The decision of the Central Government
as to whether the question is of one of policy or not, shall be final.
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Power of Central Government to supersede Commission

It is stipulated under section 56 of the Act that if at any time the Central Government is of the opinion, -
(a) that the Commission, on account of circumstances beyond its control is unable to discharge the
functions or perform the duties imposed on it by or under the provisions of the Act; or
(b) that the commission has persistently made default in complying with any direction given by the
Central Government under this Act or in discharge of functions or performance of duties imposed on
it by or under the provisions of the Act and as a result of such default the financial position or the
administration of the Commission has suffered; or
(c) that the circumstances exist which render it necessary in the public interest to do so, the Central
Government may, by notification and for the reasons stated therein, supersede the Commission for
such period, not exceeding six months, as may be specified in the notification.
Thus, power to supersede CCI vests in the Central Government. However before issuing any such
notification, the Central Government shall give to the Commission a reasonable opportunity to make
representations against the proposed supersession for its consideration. Upon publication of a notification
superseding the Commission
(a) the Chairperson and other members shall vacate the office from the date of suppression;
(b) until Commission is reconstituted, all powers functions and duties of the Commission shall be
discharged by the Central Government or by an authority specified by the Central Government in
this behalf;
(c) until the Commission is reconstituted all of its properties shall vest in the Central Government.
The Central Government shall reconstitute the Commission by a fresh appointment of its Chairman and other
Members on or before the expiration of six months from the date of order of the Central Government
superseding the Commission. Any Chairperson or Member who vacates the office because the Commission
is unable to discharge its functions or perform duties imposed on it by or under the provisions of this Act on
account of circumstance beyond its control shall not be deemed to be disqualified for re-appointment upon
re-constitution of the Commission by the Government.
The Central Government shall cause a notification superseding the Commission and a full report of any
action taken under this Section and circumstances leading to such action, be laid before each House of the
Parliament at the earliest.
Restriction on disclosure of information

The Commission from time to time may require any enterprise to submit information for the purposes of the
Act. The information may relate to sensitive business secrets and patents of such an enterprise. In order to
ensure complete secrecy of such information, Section 57 provides that no information relating to an
enterprise obtained by or on behalf of the Commission for the purposes of the Act shall be disclosed except
with the previous permission of the enterprise in writing otherwise than in compliance with or for the
purposes of the Act or any other law for the time being in force.
Protection of action taken in good faith

While acting or purporting to act in pursuance of any of the provisions of this Act, the Chairperson and other
Members and the Director General, Additional, Joint, Deputy or Assistant Directors General and Registrar
and officers and other employees shall be deemed to be public servants within the meaning of Section 21 of
the Indian Penal Code. However the Act provides for protection of action taken in good faith. As per
Section 59 no suit or legal proceedings shall lie against the Central Government or Commission or any
Chairperson or any Member or Director General or Registrar or other officers or employees of the
Commission for anything, which is done or intended to be done in good faith under the Act or rules or
regulations, made thereunder.
Exclusion of jurisdiction of Civil Courts

A civil court is precluded to exercise Jurisdiction in respect of any matter, which the Commission is
empowered by or under the Act to determine and no injunction shall be granted by any court or other
authority in respect of any action taken or to be taken in pursuance of any power conferred by or under the
Act.
Application of other laws not barred

The provisions of the Act are in addition to, and not in derogation of, the provisions of any other law for the
time being in force.
Power to make rules

The Central Government may, by notification, make rules to carry out provisions of this Act. In particular, the
Central Government may make rules to provide for all or any of the following matters; namely-
(a) the term of the Selection Committee and the manner of selection of panel of names under sub-
section (2) of Section 9;
(b) the form and manner in which and the authority before whom the oath of office and of secrecy shall
be made and subscribed to under Sub-section (3) of Section 10;
(c) Omitted by the Competition (Amendment) Act, 2007;
(d) the salary and the other terms and conditions of service including travelling expenses, house rent
allowance and conveyance facilities, sumptuary allowance and medical facilities to be provided to
the Chairperson and other Members under Sub-section (1) of Section 14;
(da) the number of Additional, Joint, Deputy or Assistant Director General or such officers or other
employees in the office of DG and the manner in which such Additional, Joint, Deputy or Assistant
Director Generals or such officers or other employees may be appointed under sub-section (1A) of
Section 16.
(e) the salary, allowances and other terms and conditions of service of the Director General, Additional,
Joint, Deputy or Assistant Directors General or such officers or other employees under Sub-section
(3) of Section 16;
(f) the qualifications for appointment of the Director General, Additional, Joint, Deputy or Assistant
Directors General or such officers or other employees under Sub-section (4) of Section 16;
(g) the salaries and allowances and other terms and conditions of service of the Secretary and officers
and other employees payable, and the number of such officers and employees under Sub-section
(2) of Section 17;
(h) for securing any case or matter which requires to be decided by a Bench composed of more than
two Members under Sub-section (4) of Section 23; (Omitted by the Competition (Amendment) Act,
2007)
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(i) any other matter in respect o which the Commission shall have power under clause (g) of Sub-
section (2) of Section 36; (Omitted by the Competition (Amendment) Act, 2007)
(j) the promotion of competition advocacy, creating awareness and imparting training about
competition issues under Sub-section (3) of Section 49; (Omitted by the Competition (Amendment)
Act, 2007)
(k) the form in which the annual statement of accounts shall be prepared under Sub-section (1) of
Section 52;
(l) the time within which and the form and manner in which the Commission may furnish returns,
statements & such particulars as the Central Government may require under Sub-section (1) of
Section 53;
(m) the form in which and the time within which the annual report shall be prepared under Sub-section
(2) of Section 53;
(ma) the form in which an appeal may be filed before the Appellate Tribunal under sub-section (2) of
section 53B and the fees payable in respect of such appeal;
(mb) the term of the Selection Committee and the manner of selection of panel of names under sub-
section(2) of section 53E;
(mc) the salaries and allowances and other terms and conditions of service of the Chairperson and other
Members of the Appellate Tribunal under sub-section (1) of section 53G;
(md) the salaries and allowances and other conditions of service of the officers and other employees of
the Appellate Tribunal under sub-section (3) of section 53M;
(me) the fee which shall be accompanied with every application made under sub-section (2) of section
53N;
(mf) the other matters under clause (i) of sub-section(2) of section 53O in respect of which the Appellate
Tribunal shall have powers under the Code of Civil Procedure, 1908 (5 of 1908) while trying a suit;
(n) the manner in which the monies transferred to the Central Government shall be dealt with by that
Government under the fourth proviso to Sub-section (2) of Section 66;
(o) any other matter which is to be, or may be, prescribed, or in respect of which provision is to be, or
may be, made by rules.
Every notification for making such rules shall be laid before each House of Parliament, while it is in session,
for a total period of thirty days which may be comprised in one session, or in two or more successive
sessions. If both Houses agree that notification is not be issued or rule should not be made, then rule shall
not be made or if the House decides that notification or rules should have effect in such modified form then
the rule or notification shall be enforced in modified form. However, any such modification or annulment shall
be without prejudice to the validity of anything previously done under the notification or rule, as the case may
be.
Power to make Regulations

The Commission may, by notification, make regulations, which are consistent with the Act. Without prejudice
to the generality of the foregoing provision, such regulations may provide for all or any of the following
matters, namely, -
(a) the cost of production to be determined under clause (b) of the Explanation to Section 4;
(b) the form of notice as may be specified and the fee which may be determined under Sub-section (2)
of Section 6;
(c) the form in which details of acquisition shall be filed under Sub-section (5) of Section 6;
(d) the procedure to be followed for engaging the experts and the professionals under sub-section (3)
of Section 17;
(e) the fee which may be determined under clause (a) of Sub-section (1) of Section 19;
(f) the rules of procedure in regard to transaction of business at the meetings of the Commission under
sub-section (1) of Section 22;
(g) the manner in which penalty shall be recovered under sub-section (1) of Section 39;
(h) any other matter in respect of which provision is to be, or may be made by regulations.
Every regulation shall be laid before both the Houses of Parliament, while it is in session, for a total period of
thirty days which may be comprised in one session or in two or more successive sessions, and if before the
expiry of the session immediately following the session or the successive sessions aforesaid, both Houses
agree in making any modification in the regulation, or both Houses agree that the regulation should not be
made, the regulation shall thereafter have effect only in such modified form or be of no effect, as the case
may be. However, any such modification or annulment shall be without prejudice to the validity of anything
previously done under that regulation.
Power to remove difficulties

The Central government may, by order published in the Official Gazette, make such provisions, not
inconsistent with the provisions of the Act as may appear to be necessary to remove difficulties which may
arise in giving effect to the provisions of the Act. However, no such order shall be made after expiry of a
period of two years from the commencement of the Act. Every order made under this Section shall be laid
before both the Houses of Parliament as soon as may be, after it is made.
Repeal and Saving

Section 66 provides that the Monopolies and Restrictive Trade Practices Act, 1969 (54 of 1969) is hereby
repealed and the Monopolies and Restrictive Trade Practices Commission established under sub-section (1)
of section 5 of the said Act (hereinafter referred to as the repealed Act) shall stand dissolved.
(1A)The repeal of the Monopolies and Restrictive Trade Practices Act, 1969 (54 of 1969) shall, however, not
affect,-
(a) the previous operation of the Act so repealed or anything duly done or suffered thereunder; or
(b) any right, privilege, obligation or liability acquired, accrued or incurred under the Act so repealed; or
(c) any penalty, confiscation or punishment incurred in respect of any contravention under the Act so
repealed; or
(d) any proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty,
confiscation or punishment as aforesaid, and any such proceeding or remedy may be instituted,
continued or enforced, and any such penalty, confiscation or punishment may be imposed or made
as if that Act had not been repealed.
(2) On the dissolution of the Monopolies and Restrictive Trade Practices Commission, the person appointed
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as the Chairman of the Monopolies and Restrictive Trade Practices Commission and every other person
appointed as Member and Director General of Investigation and Registration, Additional, Joint, Deputy, or
Assistant Directors General of Investigation and Registration and any officer and other employee of that
Commission and holding office as such immediately before such dissolution shall vacate their respective
offices and such Chairman and other Members shall be entitled to claim compensation not exceeding three
months' pay and allowances for the premature termination of term of their office or of any contract of service:
Provided that the Director General of Investigation and Registration, Additional, Joint, Deputy or
Assistant Directors General of Investigation and Registration or any officer or other employee who has
been, immediately before the dissolution of the Monopolies and Restrictive Trade Practices Commission
appointed on deputation basis to the Monopolies and Restrictive Trade Practices Commission, shall, on
such dissolution, stand reverted to his parent cadre, Ministry or Department, as the case may be:
Provided further that the Director-General of Investigation and Registration, Additional, Joint, Deputy or
Assistant Directors General of Investigation and Registration or any officer or other employee who has
been, immediately before the dissolution of the Monopolies and Restrictive Trade Practices Commission,
employed on regular basis by the Monopolies and Restrictive Trade Practices Commission, shall
become, on and from such dissolution, the officer and employee, respectively, of the Competition
Commission of India or the Appellate Tribunal, in such manner as may be specified by the Central
Government, with the same rights and privileges as to pension, gratuity and other like matters as would
have been admissible to him if the rights in relation to such Monopolies and Restrictive Trade Practices
Commission had not been transferred to, and vested in, the Competition Commission of India or the
Appellate Tribunal, as the case may be, and shall continue to do so unless and until his employment in
the Competition Commission of India or the Appellate Tribunal, as the case may be, is duly terminated or
until his remuneration, terms and conditions of employment are duly altered by the Competition
Commission of India or the Appellate Tribunal, as the case may be.
Provided also that notwithstanding anything contained in the Industrial Disputes Act, 1947(14 of 1947),
or in any other law for the time being in force, the transfer of the services of any Director General of
Investigation and Registration, Additional, Joint, Deputy or Assistant Directors General of Investigation
and Registration or any officer or other employee, employed in the Monopolies and Restrictive Trade
Practices Commission, to the Competition Commission of India or the Appellate Tribunal, as the case
may be, shall not entitle such Director General of Investigation and Registration, Additional, Joint, Deputy
or Assistant Directors General of Investigation and Registration or any officer or other employee any
compensation under this Act or any other law for the time being in force and no such claim shall be
entertained by any court, tribunal or other authority:
Provided also that where the Monopolies and Restrictive Trade Practices Commission has established a
provident fund, superannuation, welfare or other fund for the benefit of the Director General of
Investigation and Registration, Additional, Joint, Deputy or Assistant Directors General of Investigation
and Registration or the officers and other employees employed in the Monopolies and Restrictive Trade
Practices Commission, the monies relatable to the officers and other employees whose services have
been transferred by or under this Act to the Competition Commission of India or the Appellate Tribunal,
as the case may be, shall, out of the monies standing on the dissolution of the Monopolies and
Restrictive Trade Practices Commission to the credit of such provident fund, superannuation, welfare or
other fund, stand transferred to, and vest in ,the Competition Commission of India or the Appellate
Tribunal as the case may be, and such monies which stand so transferred shall be dealt with by the said
Commission or the Tribunal, as the case may be, in such manner as may be prescribed.
(3) All cases pertaining to monopolistic trade practices or restrictive trade practices pending (including such
cases, in which any unfair trade practice has also been alleged), before the Monopolies and Restrictive
Trade Practices Commission shall, on the commencement of the Competition (Amendment) Act, 2009 stand
transferred to the Appellate Tribunal and shall be adjudicated by the Appellate Tribunal in accordance with
the provisions of the repealed Act as if that Act had not been repealed.
“Explanation.— For the removal of doubts, it is hereby declared that all cases referred to in this sub-
section, sub-section (4) and subsection (5) shall be deemed to include all applications made for the
losses or damages under section 12B of the Monopolies and Restrictive Trade Practices Act, 1969 as it
stood before its repeal;
(4) Subject to the provisions of sub-section(3), all cases pertaining to unfair trade practices other than those
referred to in clause (x) of sub-section(1) of section 36A of the Monopolies and Restrictive Trade Practices
Act, 1969 (54 of 1969) and pending before the Monopolies and Restrictive Trade Practices Commission
immediately before the commencement of the Competition (Amendment) Act, 2009, shall, stand transferred
to the National Commission constituted under the Consumer Protection Act, 1986 (68 of 1986) and the
National Commission shall dispose of such cases as if they were cases filed under that Act:
Provided that the National Commission may, if it considers appropriate, transfer any case transferred to it
under this sub-section, to the concerned State Commission established under section 9 of the Consumer
Protection Act, 1986 (68 of 1986) and that State Commission shall dispose of such case as if it was filed
under that Act.
“Provided further that all the cases relating to the unfair trade practices pending, before the National
Commission under this sub-section, on or before the date on which the Competition (Amendment) Act,
2009 receives the assent of the President, shall, on and from that date, stand transferred to the Appellate
Tribunal and be adjudicated by the Appellate Tribunal in accordance with the provisions of the repealed
Act as if that Act had not been repealed.”
(5) All cases pertaining to unfair trade practices referred to in clause (x) of subsection (1) of section 36A of
the Monopolies and Restrictive Trade Practices Act, 1969 and pending before the Monopolies and
Restrictive Trade Practices Commission shall, on the commencement of the Competition (Amendment) Act,
2009 stand transferred to the Appellate Tribunal and the Appellate Tribunal shall dispose of such cases as if
they were cases filed under that Act.
(6) All investigations or proceedings, other than those relating to unfair trade practices, pending before the
Director General of Investigation and Registration on or before the commencement of this Act shall, on such
commencement, stand transferred to the Competition Commission of India, and the Competition
Commission of India may conduct or order for conduct of such investigation or proceedings in the manner as
it deems fit.
(7) All investigations or proceedings, relating to unfair trade practices, other than those referred to in clause
(x) of sub-section (1) of section 36A of the Monopolies and Restrictive Trade Practices Act, 1969(54 of 1969)
and pending before the Director General of Investigation and Registration on or before the commencement
of this Act shall, on such commencement, stand transferred to the National Commission constituted under
the Consumer Protection Act, 1986 (68 of 1986) and the National Commission may conduct or order for
conduct of such investigation or proceedings in the manner as it deems fit.
“Provided that all investigations or proceedings, relating to unfair trade practices pending before the National
Commission, on or before the date on which the Competition (Amendment) Bill, 2009 receives the assent of the
188 EP-ECL
President shall, on and from that date, stand transferred to the Appellate Tribunal and the Appellate Tribunal
may conduct or order for conduct of such investigation or proceedings in the manner as it deems fit.”
(8) All investigations or proceedings relating to unfair trade practices referred to in clause (x) of subsection
(1) of section 36A of the Monopolies and Restrictive Trade Practices Act, 1969(54 of 1969), and pending
before the Director General of Investigation and Registration on or before the commencement of this Act
shall, on such commencement, stand transferred to the Competition Commission of India and the
Competition Commission of India may conduct or order for conduct of such investigation in the manner as it
deems fit.
(9) Save as otherwise provided under sub-sections (3) to (8), all cases or proceedings pending before the
Monopolies and Restrictive Trade Practices Commission shall abate.
(10) The mention of the particular matters referred to in sub-sections (3) to (8) shall not be held to prejudice
or affect the general application of section 6 of the General Clauses Act, 1897 (10 of 1897) with regard to the
effect of repeal.
LESSON ROUND UP
• Competition Act, 2002 seeks to provide, keeping in view the economic development of the country, for the
establishment of Competition Commission to prevent practices having adverse effect on competition, to promote and
sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carried on by
other participants in markets in India and for matters connected therewith or incidental thereto besides repeal of
MRTP Act and the dissolution of the MRTP Commission.
• No enterprise or association of enterprises or person or association of persons shall enter into any agreement in
respect of production, supply, distribution, storage, acquisition or control of goods or provision of services, which
causes or is likely to cause an appreciable adverse effect on competition.
• Competition Act expressly prohibits any enterprise or group from abusing its dominant position. Dominant Position
meaning thereby a position of strength, enjoyed by an enterprise or group, in the relevant market, in India, which
enables it to operate independently of competitive forces prevailing in the relevant market; or affect its competitors or
consumers or the relevant market in its favour.
• Competition Act prohibits any person or enterprise from entering into a combination which causes or is likely to
cause an appreciable adverse effect on competition within the relevant market in India and if such a combination is
formed it shall be void.
• While formulating a policy on the competition the Central/State Government may make a reference to the
Commission for its opinion on possible effect of such a policy on the competition.
• Competition Appellate Tribunal to hear and dispose of appeals against the direction issued or decision made or
orders passed by the Commission under the Act, and to adjudicate on claim of compensation.
• The Central Government or any State Government or the Commission or any statutory authority or any local
authority or any enterprise or any person aggrieved by any decision or order of the Appellate Tribunal may file an
appeal to the Supreme.
SELF TEST QUESTIONS

1. Define and discuss the Relevant Market, Relevant Geographic Market, and Relevant Product
Market.
2. What are anti-competitive agreements. Discuss the procedure for enquiry into anti-competitive
agreements.
3. Discuss the composition and functions of Competition Commission of India.

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Lesson 3

LESSON OUTLINE LEARNING OBJECTIVES

What is competition in the market?

Competition and Economic Efficiency

Competition Law and Policy

COMPETITION REGIME IN INDIA

Economic Reforms and Competition

Competition Law-Evolution and Development

Scheme of the MRTP Act

MRTP (Amendment) Act, 1991

Scope and Applicability of the MRTP Act

MONOPOLISTIC TRADE PRACTICES

RESTRICTIVE TRADE PRACTICES

UNFAIR TRADE PRACTICES

Consumer Protection Law in India

Recommendations of Sachar Committee

Scheme of the Act with respect to Unfair Trade Practices

Why do we need competition in the market?

COMPETITION ACT, 2002

Scheme of the Act

The terms ‘acquiring’ or ‘acquisition’ are relevant for “Regulation of Combinations”.

Some of the conditions that are conducive to cartelization are:

high concentration - few competitors

(a) products manufactured, processed or mined;

(b) debentures, shares and stocks after allotment;

Notification means notification published in the Official Gazette. [Section 2(k)]

Public Financial Institution

Relevant Geographic Market

Relevant Product Market

Turnover includes value of sale of goods or services. [Section 2(y)]

Anti Competitive Agreements

Bid rigging is anti-competitive

• agreements to submit identical bids

WHAT IS AN ANTI-COMPETITIVE AGREEMENT?

Prohibition of abuse of dominant position

WHAT CONSTITUTES ABUSE OF DOMINANCE?

THRESHOLDS FOR FILING NOTICE

Enterprise Level India >2000 INR crore >6000 INR crore

Worldwide with >USD 1 bn with at OR >USD 3 bn with at least

Group Level India >8000 INR crore >24000 INR crore

Worldwide with >USD 4 bn with at OR >USD 12 bn with at

THRESHOLDS FOR AVAILING OF DE MINIMIS EXEMPTION FOR ACQUISITIONS

Selection of Chairperson and Members of Commission

Term of office of Chairperson and other Members

Resignation of Chairperson etc.

(a) is, or at any time has been, adjudged as an insolvent; or

(f) has become physically or mentally incapable of acting as a Member.

Financial and Administrative Powers of Member Administration

Salary and Terms and Conditions of Service

Appointment of Director General

Duties, Powers and Functions of Commission

As per Section 18 of the Act, duties of the CCI are:

(c) to protect interests of consumers and

Inquiry into certain agreements and dominant position of enterprise

(a) creation of barriers to new entrants in the market;

(b) driving existing competitors out of the market;

(c) foreclosure of competition by hindering entry into the market;

(d) accrual of benefits to consumers;

(e) improvements in production or distribution of goods or provision of services;

(f) promotion of technical, scientific and economic development by means of production or