Competition Commission of India’s Trysts with Law and Policy: Enforcement One Year On

Harman Sandhu, Pallavi Shroff, Dec 16, 2010

The (Indian) Competition Act, 2002 (“Act”) aims to promote competition and to prevent practices that adversely affect competition. The Competition Commission of India (“CCI”) is the statutory body created to enforce the Act. Although enacted in 2002, the Act is being brought into force in a phased manner. Sections 3 and 4 of the Act (relating to anticompetitive agreements and abuse of dominance) were effectively brought into force in May 2009, along with the enforcement powers of the CCI. Sections 5 and 6, which create India’s merger control regime, requiring CCI pre-clearance of mergers, acquisitions, and amalgamations meeting specified worldwide and/or Indian turnover/asset-based thresholds (referred to in the Act as “combinations”) have not yet come into effect.

The Act superseded the Monopolies and Restrictive Trade Practices Act, 1969 (“MRTP Act”), which sought to regulate monopolistic, restrictive, and unfair trade practices with effect from September 1, 2009 when the MRTP Act was repealed. Later, on October 14, 2009, the Monopolies & Restrictive Trade Practices Commission (“MRTPC”), which had jurisdiction over MRTP Act cases, was dissolved, and pending MRTPC investigations and cases were transferred to the CCI and the Competition Appellate Tribunal (“COMPAT”), respectively.

2010 was a landmark year for the development of competition law in India, as it was the first full year with the substantive enforcement provisions of the Act in force. In that regard, 2010 saw a significant increase in the enforcement activities by the CCI. Certain key issues, pertaining to the CCI’s jurisdiction, powers, and obligations towards parties to the investigation etc., which will shape the way the CCI functions and handles investigations in the future, were also decided by the Supreme Court of India and the Bombay High Court.