Working and effectiveness of Competition Law in India

Introduction and Development of Competition Law

The Competition Act, 2002 (Competition Act) is the primary legislation governing the Indian competition/antitrust law landscape and it led to the establishment of the Competition Commission of India (CCI)— the Indian competition law regulator. The Competition Act replaced the Monopolies and Restrictive Trade Practices Act, 1969 which previously regulated unfair trade practices and monopolies in business in India.

The Competition Act was enforced in a phased manner. While the prohibition on anti-competitive agreements (including cartels) and abuse of dominant positions was brought into force on 20-5-2009, the merger control regime was brought into force on 01-6-2011.

Important Definitions

The Competition Act primarily regulates two broad issues:-

(a) Enforcement.— The Competition Act prohibits,

(i) anti- competitive horizontal agreements;

(ii) anti-competitive vertical agreements; and

(iii) abuse of a dominant position to prevent appreciable adverse effect on competition in India(AAEC). Each prohibition gives rise to a distinct set of commercial and legal considerations— familiarity with which will benefit both corporates and counsels alike.

(b) Merger control.— The CCI reviews domestic and global Mergers and Acquisitions(M&A)to ensure that they do not cause anti-competitive impact in the Indian market. The CCI has the jurisdiction to review the acquisition of shares, voting rights, control, or assets, as well as mergers and amalgamations.

Anti-Competitive Agreements

People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public or in some contrivance to raise prices. It is impossible indeed to prevent such meetings by any law, which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies, much less to render them necessary.

Adam Smith

Regulation of Abuse of Dominant Position

Regulation of Combinations

Leniency Programme and Competition Advocacy

Emerging Trends in Competition Law