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Competition Law

The document provides an overview of competition law in India. It outlines the objectives of the Competition Act of 2002 as preventing anti-competitive practices, promoting competition, protecting consumer interests, and ensuring freedom of trade. It also describes prohibitions on anti-competitive agreements between enterprises, abuse of dominant market positions, and regulations on large mergers and acquisitions. Recent cases involving penalties for cartel activities, abuse of dominance, and merger approvals are also mentioned.

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259 views15 pages

Competition Law

The document provides an overview of competition law in India. It outlines the objectives of the Competition Act of 2002 as preventing anti-competitive practices, promoting competition, protecting consumer interests, and ensuring freedom of trade. It also describes prohibitions on anti-competitive agreements between enterprises, abuse of dominant market positions, and regulations on large mergers and acquisitions. Recent cases involving penalties for cartel activities, abuse of dominance, and merger approvals are also mentioned.

Uploaded by

minakshi tiwari
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Competition Law in India

Presenter Name- Dr. I.Sridhar


Date- 10th/11th August 2019
Overview of Competition Law in India

1. Introduction to Competition Act, 2002

2. Objectives of Competition Act


- Prevent Practices having adverse effect on competition
- Promote & Sustain competition in markets
- Protect Interest of consumers
- Ensure freedom of trade carried on by other participants
in the market
- Competition advocacy

2
Overview of Competition Law in India

3. Prohibition of Anti Competitive Agreements Section 3(1)

-No enterprise shall enter into any agreement in respect of


production, supply, distribution, storage, acquisition,
control of goods / services which causes or likely to cause
appreciable adverse effect on competition.

- Under the law the whole agreement is void

3
Overview of Competition Law in India

Prohibition of Anti Competitive Agreements Section 3(2)


Agreements which
- directly or indirectly determine purchase or sale price,
- limits or controls production, supply, markets, technical
development, investment or provision of services,
- shares the market or source of production by way
allocation of geographical area or type of goods or service,
- directly or indirectly results in bid rigging or collusive
bidding shall be presumed to have appreciable adverse
effect on competition

4
Overview of Competition Law in India

Prohibition of Anti Competitive Agreements Section 3(4)

Agreements which provides for


- tie-in agreement
- exclusive supply agreement
- exclusive distribution agreement
- refusal to deal
- resale price maintenance

shall be in contravention of Sec 3(1) if such agreement causes


or likely to cause appreciable adverse effect on competition

5
Overview of Competition Law in India

4. Prohibition of Abuse of Dominant Position Section – 4

- No enterprise shall abuse its dominant position


Dominant position means position of strength which
enables to:
- operate independently of competitive forces
- affect its competitors or consumers or the relevant
market its favour

6
Overview of Competition Law in India

Prohibition of Abuse of Dominant Position Section – 4(2)

There shall be abuse of dominant position, if an enterprise


directly or indirectly imposes unfair or discriminatory
condition in
- purchase or sale of goods or service,
- price in purchase or sale of goods or service
(Predatory Pricing)

7
Overview of Competition Law in India

Prohibition of Abuse of Dominant Position Section – 4(2)

Limiting or restricting
- production of goods or provision of service or market
- technical or scientific development relating to goods or
services to the prejudice of consumers
- practices of denial of market access
- makes conclusion of contracts subject to acceptance
by other parties of supplementary obligations which have
no connection with the subject of such contracts
- uses dominant position in one market to enter into other
relevant market

8
Overview of Competition Law in India

5. Regulation of Combinations Sections 5 & 6


Commission to regulate Combinations, i.e., large mergers,
acquisitions which are likely to have appreciable adverse
effect on competition
Threshold limits
for single enterprise
Assets > Rs. 1,500 crores
Turnover > Rs. 4,500 crores
for group of enterprises
Assets > Rs. 6,000 crores
Turnover > Rs. 18,000 crores

9
Overview of Competition Law in India
Threshold provided for overseas enterprises / groups
for single enterprise
Assets > $ 750M (min indian component – Rs.750CR)
Turnover > $ 2,250M (min indian component – Rs.2,250CR)
for group of enterprises
Assets > $ 3 bn (min indian component – Rs.750CR)
Turnover > $ 9 bn (min indian component – Rs.2,250CR)

Notification of Combinations to Commission is mandatory within


30 days of. approval of such proposal by BODs or execution of
any agreement / document
If notified, Commission to take decision within 210 days on the
Combination.
Decision may allow, disallow, modify, etc the Combination
10
Overview of Competition Law in India

6. Inquiry into Anti-competitive agreements / Abuse of dominance


- Suo motu inquiry
- On receipt of complaint
- On receipt of a reference
Commission has suo motu power to enquire whether a
combination causes or is likely to cause an appreciable
adverse effect on competition.

11
Overview of Competition Law in India

7. Powers of Commission
- Cease & desist order
- Impose penalty upto 10% of turnover
- In case of Cartel, penalty can be 10% of turnover or 3 times
of profit illegally gained from cartel activity, whichever is
more
- Recommend to Govt the division of dominant enterprise
- Various penalties ranging from Rs. 1lakh upto Rs. 1 crore are
also provided for failure to comply with direction / order of
Commission

12
Overview of Competition Law in India

8. Recent cases concerning Anti-Competitive Agreements and Abuse


of Dominant Position and Regulation of Combinations

i) On Cement Cartel – Fine of Rs. 6,200Cr


ii) On DLF – Fine of Rs.630Cr
iii) On NSE – Fine of Rs.55.5Cr
iv) On BCCI for abusing power – Fine of Rs.52.24 Cr
v) M&M - Mahindra Navistar deal approval – 9th Feb, 2013
vi) Diageo-USL deal approval – 26th Feb, 2013
vii) On Tyre cartel and Sugar cartel
viii) On agreement between SAIL and Indian Railways
ix) On acquisition of Barclay’s creditcard business by Standard
Chartered Bank
13
Overview of Competition Law in India

x) On merger of Nippon Steel, Sumitomo Metal Industries


xi) On Coal India role in stagnant output
xii) Probe on SBI & Associate banks CASA rates
xiii) On FDI in retail

14
Thank You

15

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