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Contents PAGE
CHAPTER 1 INTRODUCTION 1.1 MRTP Act replaced by Competition Act, 2002 I-19 1.1-1 Distinction between MRTP Act and Competition Act I-19 1.1-2 Consumer Protection Act, 2019 I-20 1.2 Role and purpose of Competition Act, 2002 I-20 1.2-1 Objects of the Competition Act I-22 1.2-2 Statement of Objects and Reasons for Competition Act, 2002 I-22 1.2-3 Objects and reasons of 2007 amendments I-23 1.3 Overall scheme of Competition Act, 2002 I-24 1.3-1 Arrangement of chapters and sections of Competition Act, 2002 I-24 1.3-2 Implementation of Competition Act in stages I-24 1.4 Competition Commission of India I-25 1.4-1 CCI is independent authority to consider violations of Competition Act I-26 1.4-2 Enquiry by DGCC I-26 1.4-3 Other provisions relating to CCI I-26 1.4-4 Appeal against order of CCI I-27 1.4-5 About CCI I-27 1.4-6 Disposal of CCI as on 31-3-2022 I-27 1.5 CCI is a quasi judicial body I-27 1.6 Definitions applicable to various provisions of Competition Act I-28 1.6-1 Enterprises - definition I-28 I-5
GUIDE TO COMPETITION ACT, 2002
CHAPTER 2
PROHIBITION OF
2.1 Anti-competitive agreements void
2.1-1 Entering into specified agreemen itself is not offense
2.1-2 What is 'void agreement'
2.2 Presumed anti-competitive agreements
2.2-1 Shall be presumed
2.2-2 Agreements presumed to be anti-competitive unless proved otherwise
2.3 Agreement which directly or indirectly determines purchase or sale prices
2.4 Agreement which limits or controls production, supply, markets, technical development, investment or provision of services
2.4-1 Cartel is presumed anti-competitive agreement
2.4-2 Protecting inefficient industry is not in public interest and in such cases 'cartel' is permissible
2.5 Agreement which shares the market or source of production or provision of services
2.6 Agreement which directly or indirectly results in bid rigging or collusive bidding
2.6-1 Meaning of 'Bid rigging'
2.7 Prohibition if the agreement affects competition
2.7-1 Pre-payment charges levied by Housing Finance Companies
1.6-2 Person - definition I-30 1.6-3 Agreement - definition I-31 1.6-4 Trade - definition I-31 1.6-5 Practice - definition I-31 1.6-6 Goods - definition I-31 1.6-7 Shares - definition I-32 1.6-8 Service - definition I-32 1.6-9 Price - definition I-33 1.6-10 Consumer - definition I-33 1.6-11 Group - definition I-33 1.6-12 Control - definition I-34 1.6-13 Statutory
- definition I-34
authority
ANTI-COMPETITIVE AGREEMENTS
I-35
I-36
I-36
I-37
I-38
I-39
I-39
I-39
I-42
I-45
I-45
I-45
I-45
I-46
I-47 PAGE CONTENTS I-6
2.8 Tie-in arrangement can be anti-competitive I-47
2.9 Exclusive supply agreement can be anti-competitive I-48
2.9-1 Territorial restrictions on dealers can be anti-competitive I-49
2.9-2 Rule of reason to decide whether provision is harmful to competition I-50
2.9-3 Negative covenant in case of franchises permitted I-51
2.9-4 Agreement between Indian Railways and SAIL for exclusive supply of rails I-51
2.10 Exclusive distribution agreement can be anti-competitive I-52
2.11 Agreement for Refusal to deal can be anti-competitive I-52
2.12 Re-sale price maintenance agreement can be anti-competitive I-52
2.13 Agreements not anti-competitive I-54
2.13-1 Agreements permitted by law are not anti-competitive I-54
2.13-2 Right for exclusive export is not anti-competitive I-54
2.14 Factors to be considered while deciding effect of competition I-54
2.15 Agreement in restraint of trade is void to that extent under Contract Act I-55
CHAPTER 3
PROHIBITION OF ABUSE OF DOMINANT
POSITION
3.1 Dominant position itself is not prohibited I-59
3.1-1 One sided contracts where bargaining power of parties is inequal are against public policy and are void I-60
3.2 Meaning of Dominant Position I-61
3.2-1 Relevant Market I-62
3.2-2 Factors to be considered while deciding whether enterprise enjoys dominant position I-62
3.2-3 What is 'abuse of dominant position' I-64
3.3 Unfair or discretionary conditions or prices in purchase/sale is abuse of dominant position I-64
3.3-1 Predatory price I-65
3.4 Limiting or restricting production or development I-66
3.5 Denial of market access is abuse of dominant position I-66
3.6 Supplementary obligations unconnected to main contract is abuse of dominant position I-67
I-7 CONTENTS PAGE
3.7 Using dominant position to enter another market is abuse of dominant position I-67
3.8 CCI can order division of enterprise enjoying dominant position I-69
CHAPTER 4
INVESTIGATION BY DG AND ORDERS BY CCI ON ANTICOMPETITIVE AGREEMENTS
4.1 Enquiry by CCI on information, reference or even suo motuI-70
4.1-1 Informant himself need not be aggrieved I-70
4.2 Procedure for inquiry under section 19 of Competition Act I-71
4.2-1 No notice or hearing is required at stage of giving directions to DG I-71
4.2-2 Issuing direction to DG is only administrative order I-71
4.2-3 DG can consider other relevant matters also during investigation I-71
4.3 Closing matter at initial stage itself I-72
4.4 Investigation and Report by DG I-72
4.5 Procedure if report of DG recommends that there is no contravention I-73
4.5-1 Further enquiry by Commission if DG is of opinion that there is contravention I-73
4.6 Orders by Commission after inquiry into agreements or abuse of dominant position I-73
4.6-1 Order by Commission to discontinue agreement/abuse I-74
4.6-2 Imposition of penalty by CCI I-74
4.6-3 Direction by Commission to modify agreement I-74
4.6-4 Other orders and Payment of costs that can be ordered by CCI I-75
4.6-5 Order against any group company I-75
CHAPTER 5
REGULATION OF COMBINATIONS
5.1 Control over mergers, amalgamations I-76
5.2 Meaning of combination I-76
PAGE CONTENTS I-8
5.2-1 When acquisition by large enterprises will be 'combination' I-76
5.2-2 When acquisition by group will be 'combination' I-77
5.2-3 Acquisition of enterprise having similar goods/services by a person I-77
5.2-4 Acquiring enterprise having similar goods/services by a group I-78
5.2-5 When Merger or amalgamation of enterprises will be combination
5.2-6 When merger in group company will be 'combination'
5.3 Summary of 'combinations'
5.4 Exemption from provisions relating to combination
I-78
I-79
I-79
I-80
I-82
I-82
5.5 Definition of various words used in relation to 'combination' I-81 5.5-1 Calculation of value of assets
5.5-2 Considering effect of inflation on value of assets or turnover as prescribed in the Act
I-83
I-83
I-85
I-86
I-86
Cooling
I-86
I-86
combinations I-87
of
Act I-87
Procedure
notice I-88 5.10-1 Factors to be
adverse effect of combination I-89 5.10-2 Enquiry into combination
CCI and order I-90 5.10-3 Procedure for investigation of combinations I-91 5.10-4 Order of Commission after enquiry I-92 5.10-5 Further orders by Commission I-93 5.10-6 Deemed approval if Commission does not issue orders in 210 days I-93
Effect
CCI
combination void I-94 5.10-8 Other laws not affected I-94 PAGE I-9
5.6 Regulation over combinations to ensure healthy competition
5.6-1 Provision does not apply to acquisition by PFI/FII/VCF
5.7 Mandatory notice to Commission
5.7-1 Details of acquisition to be filed by Banks/PFI/FII/VCF
5.7-2 No notice where transactions not likely to have adverse effect on competition
5.7-3
period of 210 days
5.8 Penalty for not giving notice u/s 6(2) of Competition Act
5.8-1 Green Channel for approval of
5.9 Procedure after filing of notice under section 6
Competition
5.10
at Commission after receiving
considered in determining
by
5.10-7
if
declares
CONTENTS
CHAPTER 6
COMPETITION COMMISSION
CHAPTER
OF INDIA 6.1 Formation of Competition Commission of India (CCI) I-95 6.1-1 Composition of Commission I-95 6.1-2 Selection of Chairperson and other Members I-96 6.1-3 Term of office of Chairperson and other Members I-96 6.1-4 Vacancy in office of Chairman I-97 6.1-5 Restriction on employment of Chairperson and other Members in certain cases I-97 6.1-6 Administrative powers of Chairperson I-97 6.1-7 Salary and allowances and other terms and conditions of Chairperson and other members I-98 6.1-8 Vacancy, etc., not to invalidate proceedings of Commission I-98 6.2 Finance, Accounts and Audit I-98 6.2-1 Furnishing of returns, etc. to Central Government I-98 6.3 Duties and authorities of Competition Commission I-99 6.3-1 Competition advocacy I-99 6.4 Commission has powers despite other laws I-100 6.4-1 Acts taking place outside India but having an effect on competition in India I-100 6.4-2 Commission can enter into arrangement with foreign agency I-101 6.4-3 Engagement of experts and professionals by CCI I-101 6.5 Reference by or to statutory authority I-102 6.5-1 Reference by statutory authority I-102 6.5-2 Reference to statutory authority I-102
GENERAL, SECRETARY AND OFFICERS 7.1 Functions of Director General and Secretary I-104 7.2 Appointment of Director General I-104 7.2-1 Director General to investigate contraventions I-105 7.2-2 Person can appear before DG through Advocate I-106 7.3 Secretary and officers and other employees of Commission I-106 7.3-1 Salary and terms and conditions of Secretary and other employees of Commission I-107 PAGE CONTENTS I-10
7 DIRECTOR
CHAPTER 8
PROCEDURES BEFORE COMPETITION COMMISSION
8.1 Functioning of CCI I-108 8.1-1 Commission to regulate its own procedure I-108 8.2 Meetings of Competition Commission I-108 8.2-1 Coram for meetings of Commission I-109 8.2-2 Types of meetings I-109 8.2-3 Time and place and agenda of meeting I-110 8.2-4 Attendance at meeting of CCI I-110 8.2-5 Special meetings of Commission I-110 8.3 Appearance before Commission I-111 8.4 Procedure for proceedings before CCI I-111 8.4-1 Requirement in respect of Information I-111 8.4-2 Signing of information or reference I-112 8.4-3 Submission of information/reference I-112 8.4-4 Typing and copies of information I-113 8.4-5 Fees payable with information I-113 8.4-6 Inspection and copying charges I-114 8.5 Confidentiality of Information I-114 8.6 Procedure after submission of information/reference I-114 8.7 Hearing before Commission I-115 8.7-1 Authorised representative I-115 8.8 Procedure for conduct of enquiry I-115 8.8-1 Determination of Cost of Production I-116 8.8-2 Procedure for imposition of penalty I-116 8.9 Order by Commission I-116 8.9-1 Publication of order of CCI I-117 8.10 Powers of Commission during proceedings I-117 8.10-1 Commission has powers of Civil Court I-117 8.10-2 Power to call experts I-117 8.10-3 Power to direct production of documents and information I-117 8.11 Orders of Commission and its execution I-118 8.11-1 Issue interim ex parte orders I-118 8.11-2 Rectification of orders I-119 PAGE I-11 CONTENTS
CHAPTER 9
PENALTIES AND PUNISHMENTS
CHAPTER 10
APPELLATE TRIBUNAL
9.1 Penalties that can be imposed by Commission I-120 9.2 Penalty for contravention of orders of Commission I-120 9.3 Penalty for not giving notice u/s 6(2) of Competition Act I-120 9.4 Penalty for failure to comply with directions of Commission and Director General I-121 9.5 Penalty for making false statement or omission to furnish material information I-121 9.6 Penalty for offences in relation to furnishing of information I-121 9.7 Contravention by companies I-122 9.8 Lesser penalty if full disclosure made, in case of cartel I-122 9.8-1 Conditions and Procedure for imposing lesser penalty in case of cartel I-122 9.9 Procedure for imposing penalty by Commission I-123 9.10 Appeal against order of CCI imposing penalty I-123 9.11 Execution of orders of Commission imposing monetary penalty I-123 9.12 Order of compensation by NCLAT in case of contravention of orders of Commission I-123 9.13 Punishment for contravention of orders of Commission by criminal court I-124
10.1 Appeal from order of CCI to NCLAT I-125 10.1-1 Appeal to NCLAT I-125 10.1-2 Who can file appeal I-125 10.1-3 Time limit for filing appeal I-126 10.2 Orders against which appeal can be filed I-126 10.2-1 CCI is a necessary or proper party before NCLAT I-126 10.2-2 Appeal cannot be dismissed if no Pre-deposit of penalty but stay stands vacated I-126 10.2-3 Hearing and order by NCLAT I-126 10.3 Procedure by NCLAT I-127 10.4 Powers of NCLAT I-127 10.4-1 Procedure before NCLAT are judicial proceedings I-127 PAGE CONTENTS I-12
DIVISION ONE :
DIVISION
DIVISION THREE :
10.5 Awarding compensation by NCLAT I-128 10.5-1 Class action for compensation I-128 10.6 Compensation in case of contravention of orders of Commission I-128 10.7 Review of orders of Appellate Tribunal I-129 10.8 Punishment for contravention of order of NCLAT I-130 10.9 Appeal against order of NCLAT I-130 10.9-1 Procedure for filing appeals and application for compensation I-130 10.10 Overview of NCLAT I-130 CHAPTER 11 OTHER PROVISIONS OF COMPETITION ACT 11.1 Powers of Central Government I-132 11.1-1 Powers of Central Government to issue directions to CCI I-132 11.2 Restriction on disclosure of information I-133 11.3 Chairperson, members and officers are public servants I-133 11.4 Protection of action taken in good faith I-133 11.5 Act to have overriding effect I-133 11.6 Exclusion of jurisdiction of civil courts I-134 11.7 MRTP Commission abolished I-134 SUBJECT INDEX I-135
COMPETITION
1.1A CHART SHOWING ENFORCEMENT OF PROVISIONS OF COMPETITION ACT, 2002 FROM DIFFERENT DATES 1.3 1.2TEXT OF COMPETITION ACT, 2002 AS AMENDED UP TO DATE 1.9
ACT, 2002
2.3
TWO : NOTIFICATIONS 2.1NOTIFICATIONS
RULES
REGULATIONS
COMMISSION OF INDIA (GENERAL) REGULATIONS, 2009 3.3 PAGE I-13 CONTENTS
&
UNDER COMPETITION LAW 3.1COMPETITION
3.12
3.13
3.15
3.16
3.2COMPETITION COMMISSION OF INDIA (DETERMINATION OF COST OF PRODUCTION) REGULATIONS, 2009 3.31 3.3COMPETITION COMMISSION OF INDIA (RETURN ON MEASURES FOR THE PROMOTION OF COMPETITION ADVOCACY, AWARENESS AND TRAINING ON COMPETITION ISSUES) RULES, 2008 3.33 3.4COMPETITION COMMISSION OF INDIA (LESSER PENALTY) REGULATIONS, 2009 3.36 3.5COMPETITION COMMISSION OF INDIA (MANNER OF RECOVERY OF MONETARY PENALTY) REGULATIONS, 2011 3.43 3.6COMPETITION APPELLATE TRIBUNAL (FORM AND FEE FOR FILING AN APPEAL AND FEE FOR FILING COMPENSATION APPLICATIONS) RULES, 2009 3.54 3.7COMPETITION COMMISSION OF INDIA (MEETING FOR TRANSACTION OF BUSINESS) REGULATIONS, 2009 3.60 3.8COMPETITION COMMISSION OF INDIA (PROCEDURE FOR ENGAGEMENT OF EXPERTS AND PROFESSIONALS) REGULATIONS, 2009 3.65 3.9COMPETITION COMMISSION OF INDIA (FORM OF ANNUAL STATEMENT OF ACCOUNTS) RULES, 2009 3.71 3.10 COMPETITION COMMISSION OF INDIA (FORM AND TIME OF PREPARATION OF ANNUAL REPORT) RULES, 2008 3.90
COMPETITION APPELLATE TRIBUNAL (TERM OF THE SELECTION COMMITTEE AND THE MANNER OF SELECTION OF PANEL OF NAMES) RULES, 2008 3.98
3.11
COMPETITION APPELLATE TRIBUNAL (SALARIES AND ALLOWANCES AND
TERMS AND CONDITIONS OF SERVICE OF THE CHAIRPERSON AND OTHER MEMBERS) RULES, 2009 3.100
OTHER
COMPETITION APPELLATE TRIBUNAL (RECRUITMENT, SALARIES AND
TERMS AND CONDITIONS OF SER-
OF OFFICERS AND OTHER EMPLOYEES) RULES, 2010 3.107
COMPETITION COMMISSION OF INDIA (TERM OF THE SELECTION COMMITTEE AND THE MANNER OF SELECTION OF PANEL OF NAMES) RULES, 2008 3.117
OTHER
VICE
3.14
COMPETITION COMMISSION OF INDIA
CHAIRPERSON AND
THE COMMISSION) RULES, 2003 3.119
(SELECTION OF
OTHER MEMBERS OF
COMPETITION COMMISSION OF INDIA
OF CHAIRPERSON AND
MEMBERS) RULES, 2003 3.121 PAGE CONTENTS I-14
(SALARY, ALLOWANCES AND OTHER TERMS AND CONDITIONS OF SERVICE
OTHER
3.19
3.20
(NUMBER OF ADDITIONAL, JOINT, DEPUTY OR ASSISTANT DIRECTOR-GENERAL, OTHER OFFICERS AND EMPLOYEES, THEIR MANNER OF APPOINTMENT, QUALIFICATION, SALARY, ALLOWANCES
3.17COMPETITION COMMISSION OF INDIA (DIRECTOR GENERAL) RECRUITMENT RULES, 2009 3.124
COMPETITION COMMISSION OF INDIA
BERS) RULES, 2003 3.127
3.18
(OATH OF OFFICE AND OF SECRECY FOR CHAIRPERSON AND OTHER MEM-
COMPETITION COMMISSION
OFFICERS AND OTHER EMPLOYEES) RULES, 2009 3.129
OF INDIA (SALARY, ALLOWANCES, OTHER TERMS AND CONDITIONS OF SERVICE OF THE SECRETARY AND OFFICERS AND OTHER EMPLOYEES OF THE COMMISSION AND THE NUMBER OF SUCH
COMPETITION COMMISSION
AND OTHER TERMS AND CONDITIONS OF SERVICE) RULES, 2009 3.156 3.21COMPETITION COMMISSION OF INDIA (PROCEDURE IN REGARD TO THE TRANSACTION OF BUSINESS RELATING TO COMBINATIONS) REGULATIONS, 2011 3.169 3.22 COMPETITION APPELLATE TRIBUNAL (PROCEDURE) REGULATIONS, 2011 3.207 3.23 COMPETITION COMMISSION OF INDIA (COMPETITION ASSESSMENT OF ECONOMIC LEGISLATIONS AND POLICIES) GUIDELINES, 2017 3.211 DIVISION FOUR : TRIBUNALS REFORMS ACT & RULES FRAMED THEREUNDER TRIBUNALS REFORMS ACT, 2021 4.3 CONDITIONS OF SERVICE OF CHAIRPERSON AND MEMBERS OF TRIBUNALS, APPELLATE TRIBUNALS AND OTHER AUTHORITIES 4.22 TRIBUNAL (CONDITIONS OF SERVICE) RULES, 2021 4.26 DIVISION FIVE : CASE LAWS DIGEST CASE LAWS DIGEST 5.3 PAGE I-15 CONTENTS
OF INDIA
