ANTI-CARTEL

ENFORCEMENT
TEMPLATE

CARTELS WORKING GROUP

Subgroup 2: Enforcement Techniques

India
date of completion: 30/10/2013
 2

ICN ANTI-CARTEL ENFORCEMENT TEMPLATE

IMPORTANT NOTES:

This template is intended to provide information for the ICN member

competition agencies about each others legislation concerning hardcore
cartels. At the same time the template supplies information for businesses
participating in cartel activities about the rules applicable to them; moreover,
it enables businesses which suffer from cartel activity to get information about
the possibilities of lodging a complaint in one or more jurisdictions.

Reading the template is not a substitute for consulting the referenced statutes
and regulations. This template should be a starting point only.

1. Information on the law relating to cartels

A. Law(s) covering cartels:

The Competition Act, 2002.
[availability (homepage
http://www.cci.gov.in/
address) and indication
English
of the languages in
which these materials
are available]

B. Implementing
The Competition Commission of India (Lesser Penalty)
regulation(s) (if any):
Regulations, 2009.
[name and reference
The Competition Commission of India (General)
number, availability
Regulations, 2009.
(homepage address)
http://www.cci.gov.in/
and indication of the
English
languages in which
these materials are
available]

C. Interpretative
guideline(s) (if any):
[name and reference
No guidelines have been issued so far by the Commission.
number, availability
(homepage address)
and indication of the
languages in which
these materials are
 3
available]

D. Other relevant materials

http://cci.gov.in/images/media/Advocacy/Cartels2012.pdf
(if any): [availability
(homepage address)
and indication of the
languages in which
these materials are
available]

2. Scope and nature of prohibition on cartels

A. Does your law or case

Yes
law define the term
Section 2(c) of the Competition Act, 2002 defines cartel as follows:
cartel? [Please quote.]
"cartel" includes an association of producers, sellers, distributors,
traders or service providers who, by agreement amongst
If not, please indicate the
themselves, limit, control or attempt to control the production,
term you use instead.
distribution, sale or price of, or, trade in goods or provision of
[Please quote.]
services;

B. Does your legislation or

Cartels are prohibited in terms of section 3 of the Competition Act,
case law distinguish
2002.
between very serious
Section 27 (b) of the Competition Act, 2002 distinguishes between
cartel behaviour
cartel and other anticompetitive agreements in terms of imposition of
(hardcore cartels
penalty by the Competition Commission of India.
e.g.: price fixing, market
sharing, bid rigging or [Provided that in case any agreement referred to in Section 3 has
production or sales
1
quotas ) and other types been entered into by a cartel, the Commission may impose upon
of cartels? [Please each producer, seller, distributor, trader or service provider included
describe how this in that cartel, a penalty of up to three times of its profit for each year
differentiation is made of the continuance of such agreement or ten per cent of its turnover
and identify the most for each year of the continuance of such agreement, whichever is
egregious types of
conduct.] higher.]

Under section 3(3) of the Competition Act, 2002, anticompetitive

agreements included cartels indulging in price fixing, limiting or
controlling markets, market sharing, bid rigging or collusive bidding.

In case of section 3(3) alleged violations; indulging conducts of

parties are presumed to be having appreciable adverse effect on
competition in India, however this legal presumption is rebuttable.
C. Scope of the prohibition
Efficiency enhancing joint ventures are not treated as illegal.
of hardcore cartels:
[including any Export cartels are exempted
exceptions, exclusions The government can exempt any class of enterprise, any
and defences e.g. for practice or agreement arising out of a treaty and any
particular industries or enterprise performing sovereign functions [section 54]

1
In some jurisdictions these types of cartels and possibly some others are regarded as particularly serious
violations. These types of cartels are generally referred to as hardcore cartels. Hereinafter this terminology
is used.
 4
sectors. Please also
describe any other
limitations to the ban on
hardcore cartels.]

D. Is participation in a
Yes.
hardcore cartel illegal
Section 3(3) [Any agreement entered into between enterprises or
per se? [If the situation
associations of enterprises or persons or associations of persons or
differs for civil,
between any person and enterprise or practice carried on, or
administrative and
decision taken by, any association of enterprises or association of
criminal liability, please
persons, including cartels, engaged in identical or similar trade of
clarify this.]
goods or provision of 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;
(d) directly or indirectly results in bid rigging or collusive bidding,
shall be presumed to have an appreciable adverse effect on
competition:
Provided that nothing contained in this sub-section shall
apply to any agreement entered into by way of joint ventures if such
agreement increases efficiency in production, supply, distribution,
storage, acquisition or control of goods or provision of services.
Explanation For the purposes of this sub-section, bid rigging
means any agreement, between enterprises or persons referred to
in sub-section (3) engaged in identical or similar production or
trading of goods or provision of services, which has the effect of
eliminating or reducing competition for bids or adversely affecting or
manipulating the process for bidding.]
E. Is participation in a
Participation in a hardcore cartel is not a criminal offence in India
hardcore cartel a civil or
and can be subjected to fines only as described in 2B above.
administrative or
criminal offence, or a
combination of these?

3. Investigating institution(s)

A. Name of the agency, which

investigates cartels: [if there
Director General, Competition Commission of India
is more than one agency,
investigates into the allegations once CCI forms prima facie
please describe the allocation
opinion under section 26 (1) of the Act and directs
of responsibilities]
investigations.
Secretary
B. Contact details of the agency:
Competition Commission of India
[address, telephone and fax
The Hindustan Times House
including the country code,
18-20, Kasturba Gandhi Marg,
email, website address and
New Delhi 110 001
languages available on the
Tel. : + 91 11 23704651
website]
Fax : + 91 11 23704652
Email: secy@cci.gov.in
Website: http://www.cci.gov.in/
 5
Language: English

Secretary
Competition Commission of India
C. Information point for potential
The Hindustan Times House
complainants:
18-20, Kasturba Gandhi Marg,
New Delhi 110 001
Tel. : + 91 11 23704651
Fax : + 91 11 23704652
Email: secy@cci.gov.in
Website: http://www.cci.gov.in/
Language: English

Secretary
D. Contact point where
Competition Commission of India
complaints can be lodged:
The Hindustan Times House
18-20, Kasturba Gandhi Marg,
New Delhi 110 001
Tel. : + 91 11 23704651
Fax : + 91 11 23704652
Email: secy@cci.gov.in
Website: http://www.cci.gov.in/
Language: English
E. Are there other authorities
No such provision has been made in the Competition Act,
which may assist the
2002.
investigating agency? If yes,
please name the authorities
and the type of assistance
they provide.

4. Decision-making institution(s)2 [to be filled in only if this is

different from the investigating agency]

A. Name of the agency

making decisions in Competition Commission of India (CCI)
cartel cases: [if there is
more than one agency,
please describe the
allocation of
responsibilities.]
Competition Commission of India
B. Contact details of the
The Hindustan Times House
agency: [address,
18-20, Kasturba Gandhi Marg,
telephone and fax
New Delhi 110 001
including the country
Tel. : + 91 11 23704651
code, email, website
Fax : + 91 11 23704652
address and languages
Email: secy@cci.gov.in
available on the website]
Website: http://www.cci.gov.in/
Language: English

2
Meaning: institution taking a decision on the merits of the case (e.g. prohibition decision, imposition of fine,
etc.)
 6

C. Contact point for

Secretary
questions and
Competition Commission of India
consultations:
The Hindustan Times House
18-20, Kasturba Gandhi Marg,
New Delhi 110 001
Tel. : + 91 11 23704651
Fax : + 91 11 23704652
Email: secy@cci.gov.in
Website: http://www.cci.gov.in/
Language: English

DG office, the investigation arm of CCI, assists the Commission

in conducting enquiry into any contravention of the provisions
D. Describe the role of the
of the Act or any rules or regulation made thereunder and
investigating agency in
submits an investigation report to the Commission. On the
the process leading to
basis of this report, CCI may decide to inquire into the
the sanctioning of the
allegations. If it is convinced of the violation of law, it can pass
cartel conduct.
orders of cease and desist and levy fines up to 3 times of
profits or ten per cent of turnover for each year of the
continuance of cartel, whichever is higher.

E. What is the role of the

Cartelization is not a criminal offence under the Competition
investigating agency if
Act, 2002.
cartel cases belong
under criminal
proceedings?

5. Handling complaints and initiation of proceedings

A. Basis for initiating

Investigation can be initiated on the basis of complaint or suo
investigations in cartel
moto (ex officio) or on a reference made by the Central
cases: [complaint, ex
Government, State Governments or statutory authorities
officio, leniency
[section 19(1)].
application, notification,
Leniency application can be made under section 46 of the
etc.]
Competition Act, 2002.
B. Are complaints required
to be made in a specific Communication may be made by any means to:
form (e.g. by phone, in Secretary,
writing, on a form, etc.)? Competition Commission of India
[If there is a requirement The Hindustan Times House
to complete a specific 18-20, Kasturba Gandhi Marg,
form, please, indicate its New Delhi 110 001
location (website Tel. : + 91 11 23704651
address).] Fax : + 91 11 23704652
Email: secy@cci.gov.in

C. Legal requirements for

Any person, consumer or consumer association or trade
lodging a complaint
association can make a complaint (information filing) [section
against a cartel: [e.g. is
19(1)]. The Central Government, a state Government or a
legitimate interest
statutory authority can make a reference [section19 (1)]. Only
required, or is standing to
a member of a cartel can apply for leniency.
 7
make a complaint limited
to certain categories of
complainant?]

D. Is the investigating
CCI has to form a prime facie opinion that a contravention of
agency obliged to take
law has occurred before directing the Director General to
action on each complaint
investigate; otherwise, it can dismiss the complaint
that it receives or does it
(information) or reference by a written order. Orders of CCI
have discretion in this
are subject to judicial review as specified under the
respect? [Please
Competition Act, 2002.
elaborate.]

E. If the agency intends not

CCI can dismiss a complaint (information) and may pass such
to pursue a complaint, is it
orders as it deems fit, including imposition of costs, if
required to adopt a
necessary.
decision addressed to the
complainant explaining its
reasons?

F. Is there a time limit

Yes, information filed as per the Competition Commission of
counted from the date of
India (General) Regulations, 2009 are processed as per
receipt of a complaint by
timelines prescribed, however the Commission may extend
the competition agency
time in suitable cases.
for taking the decision on
whether to investigate or
reject it?

6. Leniency policy3

A. What is the official

Official name of leniency is lesser penalty. The provisions for
name of your leniency
lesser penalty are contained in section 46 of Competition Act,
policy (if any)? [Please
2002 and The Competition Commission of India (Lesser Penalty)
indicate its public
Regulations, 2009.
availability.]
http://cci.gov.in/images/media/Advocacy/CompetitionAct2012.pdf

B. Does your jurisdiction

The quantum of immunity available under leniency provisions in
offer full leniency as
comparison to penalty prescribed under clause (b) of the section
well as partial leniency
27 of the Act. Benefit of reduction in penalty up to or equal to
(i.e. reduction in the
100% is available to the applicant if he is the first to make a vital
sanction / fine),
disclosure enabling the Commission to form a prima facie opinion
depending on the
regarding the existence of a cartel on the basis of evidence
case?
submitted.

Reduction is as per mandates of the Competition Commission of

India (Lesser Penalty) Regulations, 2009.

3
For the purposes of this template the notion of leniency covers both full leniency and a reduction in the
sanction or fines. Moreover, for the purposes of this template terms like leniency amnesty and immunity
are considered as synonyms.
 8

C. Who is eligible for full

Determination is subject to the Competition Commission of India
leniency [only for the
(Lesser Penalty) Regulations, 2009.
first one to come
forward or for more
participants in the
cartel]?

D. Is eligibility for leniency

As per the Competition Commission of India (Lesser Penalty)
dependent on the
Regulations, 2009.
enforcing agency
having either no
knowledge of the cartel
or insufficient
knowledge of the cartel
to initiate an
investigation?

In this context, is the

date (the moment) at
which participants in
the cartel come forward
with information
(before or after the
opening of an
investigation) of any
relevance for the
outcome of leniency
applications?

E. Who can be a
The beneficiary can be a producer, seller, distributor, trader or
beneficiary of the
service provider who is member of a cartel.
leniency program
(individual /
businesses)?

F. What are the conditions

The conditions are making full and true disclosure, which is vital
of availability of full
for decision making. CCI can impose conditions in its order for
leniency: [e.g. provide
lower penalty [section 46].
decisive evidence,
maintain cooperation
throughout, not to be
the ringleader, cease
the infringement,
restitution, etc.]

G. What are the conditions

The reduction in monetary penalty will depend upon following
of availability of partial
situations:-
leniency (such as
the stage at which the applicant comes forward with the
reduction of sanction /
disclosure
fine / imprisonment):
the evidence already in possession of the Commission
[e.g.: valuable,
the quality of the information provided by the applicant
potential, decisive
the entire facts and circumstances of the case
evidence by witnesses
or on basis of written
documents, etc.? Must
the information be
sufficient to lead to an
initiation of
investigations?]

H. Obligations for the

 9
beneficiary after the Conditions can be imposed on the beneficiary by CCI. In the
leniency application absence of any explicit condition mentioned in law, it can be
has been accepted: presumed that obligation to fully cooperate can be imposed.
[e.g. ongoing, full
cooperation with the
investigating agency
during the proceedings,
etc.]

I. Are there formal The applicant can make application as per the contents specified
requirements to make a in the Schedule either orally or through e-mail or fax to the
leniency application? designated authority.
[e.g. must applications
take a particular form
or include particular
information/data, must
they be in writing or
can they be made
orally, etc.]

J. Are there distinct

procedural steps within No
the leniency program?
[e.g.: provisional
guarantee of leniency
PGL and further steps
leading to a final
leniency agreement /
decision)?]
The Commission shall mark the priority status of the applicant
K. At which time during
and the designated authority shall convey the same to the
the application process
applicant but, mere acknowledgement shall not entitle the
is the applicant given
applicant for grant of lesser penalty.
certainty with respect
to its eligibility for
The date and time of receipt of the application by the Commission
leniency, and how is
shall be the date and time as recorded by the designated
this done?
authority.
L. What is the legal basis
The legal basis is in section 46 of Competition Act, 2002, and The
for the power to agree
Competition Commission of India (Lesser Penalty) Regulations,
to grant leniency? Is
2009.
leniency granted on the
basis of an agreement
or is it laid down in a
(formal) decision? Who
within the agency
decides about leniency
applications?

M. Does your legislation

No
have a marker system?
If yes, please describe
it.

N. Does the system

No
provide for any extra
4
credit for disclosing

4
Also known as: leniency plus, amnesty plus or immunity plus. This category covers situations where a
leniency applicant, in order to get as lenient treatment as possible in a particular case, offers to reveal
 10
additional violations?
[e.g. a hardcore cartel
in another market]

O. Is the agency required

Under the Competition Commission of India (Lesser Penalty)
to keep the identity of
Regulations, 2009, it has been specifically mentioned that the
the beneficiary
identity of the applicant as well as information obtained from its
confidential? If yes,
shall be treated as confidential and it shall not be disclosed
please elaborate.
except under the three situations stated below:-
when the disclosure is required by law; or
when the applicant has agreed to such disclosure in writing;
or
when there has been a public disclosure by the applicant.

Such an arrangement of maintaining confidentiality would

encourage submission of vital information with the Commission.
P. Is there a possibility of
Yes, appeal lies to the Competition Appellate Tribunal.
appealing an agencys
decision rejecting a
leniency application?

Q. Contact point where a

Secretary,
leniency application
Competition Commission of India
can be lodged
The Hindustan Times House
[telephone and fax
18-20, Kasturba Gandhi Marg,
including the country
New Delhi 110 001
code, plus out of hours
Tel. : + 91 11 23704651
contacts (if any)]:
Fax : + 91 11 23704652
Email: secy@cci.gov.in
R. Does the policy
Lesser penalty imposed under the leniency provision can be
address the possibility
revoked if the beneficiary has not complied with the conditions on
of leniency being
which it was imposed, or the beneficiary has given false evidence
revoked? If yes,
or the disclosure is not vital.
describe the
circumstances where
revocation would
occur. Can an appeal
be made against a
decision to revoke
leniency?

S. Does your policy allow

There is no bar in law.
for affirmative
leniency, that is the
possibility of the
agency approaching
potential leniency
applicants?

information about participation in another cartel distinct from the one which is the subject of its first leniency
application.
 11

7. Investigative powers of the enforcing institution(s)5

A. Briefly describe the

investigative measures Both CCI and the DG are vested with powers of civil court in
available to the enforcing respect of summoning and enforcing attendance, discovery
agency such as requests and production of documents, receiving evidence on affidavits
for information, and requisitioning public records [section 36(2)]. The DG can
6 search any premises after obtaining a court warrant [section
searches/raids ,
41(3)].
electronic or computer
searches, expert opinion,
etc. and indicate whether
such measures requires
a court warrant.

B. Can private locations,

Yes after obtaining a court warrant.
such as residences,
automobiles, briefcases
and persons be
searched, raided or
inspected? Does this
require authorisation by
a court?

C. May evidence not falling

As per section 41 of the Act.
under the scope of the
authorisation allowing
the inspection be seized /
used as evidence in
another case? If yes,
under which
circumstances (e.g. is a
post-search court
warrant needed)?

D. Have there been

significant legal -
challenges to your use of
investigative measures
authorized by the
courts? If yes, please
briefly describe them.

8. Procedural rights of businesses / individuals

A. Key rights of defence in

cartel cases: [e. g.: right All procedures have to comply with principles of natural justice
of access to documents prevalent under common law [section 36(1)].
in the possession of the A complainant or defendant may either appear in person or
authorize a chartered accountant or company secretary or cost

5
Enforcing institutions may mean either the investigating or the decision-making institution or both.
6
Searches/raids means all types of search, raid or inspection measures.
 12
enforcing authority, right accountant or legal practitioner to present his or its case before
to a written statement of the Commission [section 35].
the case against the
defendant, right to
respond to that case in
writing, right to respond
orally, right to confront
companies or individuals
that make allegations
against the defendant,
right to legal
representation before the
enforcing authorities,
right not to self-
incriminate, etc. Please
indicate the relevant
legal provisions.]

B. Protection awarded to
Confidentiality of business secrets is required to be maintained
business secrets
under specific provision in the Competition Act 2002 [section
(competitively sensitive
57]. There is no distinction made on the basis of how the
information): is there a
information is received by CCI.
difference depending on
whether the information
is provided under a
compulsory legal order
or provided under
informal co-operation?
[Please indicate the
relevant legal
provisions.]

9. Limitation periods and deadlines

A. What is the limitation

None
period (if any) from the
date of the termination of
the infringement by
which the investigation /
proceedings must begin
or a decision in the
merits of the case must
be made?

B. What is the deadline,

As provided in The Competition Commission of India (General)
statutory or otherwise (if
Regulations, 2009.
any) for the completion
of an investigation or to
make a decision in the
merits?

C. What are the deadlines,

statutory or otherwise (if Appeals against any order of CCI must be ordinarily made to
any) to challenge the the Appellate Tribunal within 60 days of the order. Orders of
commencement or investigation are procedural in nature thus not appellable.
 13
completion of an
investigation or a
decision regarding
sanctions?

10. Types of decisions

A. Please list which types
of decisions on the 1) Cease and desist
merits of the case can be 2) Monetary Penalty as per section 27 of the Act.
made in cartel cases 4) Modification of agreements
under the laws listed 5) Payment of costs and compliance with any conditions
under Section 1. [E.g.: imposed
finding of an 6) Pass such other order as the Commission may deem fit in
infringement, ordering to the given case.
bring the infringement to
an end, imposition of
fines, etc.]

B. Please list which types

of decisions on the
merits of the case can be
made in hardcore cartel
cases under the laws
listed under Section 1 (if
different from those
listed under 10/A).

7
C. Can interim measures
The power to grant interim relief vests with the decision-making
be ordered during the
institution, i.e. the Commission. Such orders can be made if a
proceedings in cartel
contravention is likely to be continued or is likely to be made
cases? (if different
during pendency of the proceedings. [section 33]
measures for hardcore
cartels please describe
8
both .) Which institution
(the investigatory / the
decision-making one) is
authorised to take such
decisions? What are the
conditions for taking
such a decision?

7
In some jurisdictions, in cases of urgency due to the risk of serious and irreparable damage to competition,
either the investigator or the decision-making agency may order interim measures prior to taking a decision
on the merits of the case [e.g.: by ordering the immediate termination of the infringement].
8
Only for agencies which answered yes to question 2.C. above
 14

11. Sanctions for procedural breaches (non-compliance with

procedural obligations)9
1. Failure to comply with directions of CCI or DG under section
A. Grounds for the
36(5) section or 41(2).
imposition of procedural
2. Furnishing wrong/incorrect information
sanctions / fines:

B. Type and nature of the

Civil
sanction (civil,
administrative, criminal,
However wilful disobedience to orders under sections 27, 28,
combined):
31, 32, 33, 42A, and 43A, may entail imprisonment for a period
which may extend to three years.
On the person or enterprise who does not comply or furnish
C. On whom can procedural
wrong/incorrect information. In case of company, the person in
sanctions be imposed?
charge of the business can also be fined.
Mentioned expressly in the Law [section 42, 43, 44, 45, 48]
D. Criteria for determining
the sanction / fine:
As per the Competition Act, 2002, depends of acts, omissions
E. Are there maximum and /
and violations of law.
or minimum sanctions /
fines?

12. Sanctions on the merits of the case

A. Type and nature of

Civil
sanctions in cartel cases
(civil, administrative,
criminal, combined):
Penalty can be imposed on businesses.
On whom can sanctions
The Commission may impose a penalty upon each producer,
be imposed? [E.g.:
seller, distributor, trader or service provider included in that
representatives of
cartel [section 27(b) Proviso].
businesses,
(imprisonment for
In case of contravention by companies, any director, manager,
individuals), businesses,
secretary or other officer with whose consent or connivance the
in the case of
act took place, can be proceeded against [section 48].
associations of
companies the
associations or the
individual companies?]

B. Criteria for determining

Nothing specific has been provided in law.
the sanction / fine: [e.g.:
gravity, duration of the
violation, benefit gained

9
In some jurisdictions non-compliance with procedural obligations (e.g. late provision of requested
information, false or incomplete provision of information, lack of notice, lack of disclosure, obstruction of
justice, destruction of evidence, challenging the validity of documents authorizing investigative measures,
etc.) can be sanctioned.
 15
from the violation]

C. Are there maximum and /

As per section 27 of the Act.
or minimum sanctions /
fines?

D. Guideline(s) on
calculation of fines: None
[name and reference
number, availability
(homepage address) and
indication of the
languages in which these
materials are available]

E. Does a challenge to a
decision imposing a It will be necessary to apply for suspension.
sanction / fine have an
automatic suspensory
effect on that sanction /
fine? If it is necessary to
apply for suspension,
what are the criteria?

13. Possibilities of appeal

A. Does your law provide

Yes. An appellate body called the Competition Appellate
for an appeal from a
Tribunal was set up in May 2009 to hear and dispose of
decision that there has
appeals against the orders made by the Commission. Final
been a violation of a
appeal lies to the Supreme Court against the order of the
prohibition of cartels? If
Competition Appellate Tribunal.
yes, what are the
grounds of appeal, such
The Appellate Tribunal shall be guided by the principles of
as questions of law or
natural justice and subject to the other provisions of the Act
fact or breaches of
and of any rules made by the Central Government.
procedural
requirements?
Appeal can be made, only on questions of law, fact or mixed
question of law and fact. Court is likely to entertain appeals on
ground of violation of natural justice.
B. Before which court or
agency should such a
Competition Appellate Tribunal
challenge be made? [if
The Supreme Court of India,
the answer to question
13/A is affirmative]