MRTP ACT, 1969 &

COMPETITION ACT,
20026.53
A Brief Analysis From –
Gidhwani Kiran Dipakkumar - 17
Parekh Priteshkumar Ashokkumar - 36
Pathak Harshil Devanbhai - 41
INTRODUCTION –
MRTP ACT, 1969
The Monopolies and Restrictive Trade Activities (MRTP)

Act, introduced in 1969, sought to limit the concentration

of economic power in a few hands while also regulating

monopolistic and restrictive trade activities in India. It

aimed to promote fair competition, protect consumers'

interests, and assure market efficiency. The MRTP Act was

amended to improve its provisions and handle

developing difficulties.

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INTRODUCTION –
COMPETITION
ACT, 2002
The MRTP Act was repealed in 2002 and replaced with the

Competition Act, which established a new regulatory

framework for Indian competition law. The Competition Act

aimed to promote and sustain competition, ban anti-

competitive practices and protect consumer welfare. It

attempted to level the playing field for enterprises, encourage

innovation and efficiency, and build a competitive market

environment that promotes economic growth and

development. The Competition Act has since been updated

to reflect changing market conditions and strengthen

competition regulation in India.

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KEY CONSTITUTIONAL PROVISIONS OF
MRTP ACT, 1969
Article 19(1)(g) Article 39(c)

This provision of the Indian Constitution guarantees the right Article 39(c) mandates that economic resources should not

to practice any profession, occupation, or trade. The MRTP be concentrated to the common detriment. The MRTP Act

Act complements this by regulating monopolies and aligns with this provision by regulating monopolistic and

restrictive trade practices, ensuring that businesses operate restrictive trade practices that could harm competition,

fairly and do not engage in practices that stifle competition restrict consumer choice, and lead to the misuse of

or harm consumers. economic power.

Article 39(b) Article 38

Article 39(b) of the Constitution directs the State to ensure While not directly related to economic regulation, Article 38

that the ownership and control of material resources are of the Constitution directs the State to secure a social order

distributed to serve the common good. The MRTP Act works to promote the welfare of the people. The MRTP Act

towards this objective by preventing the concentration of contributes to this objective by promoting fair competition,

economic power in a few hands and promoting a more preventing unfair trade practices, safeguarding consumer

equitable distribution of economic resources. interests, and fostering a more equitable and just economic

system.

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 MAIN CATEGORIES OF MRTP ACT

Monopolistic Trade Unfair Trade Restrictive Trade

Practices (MTP) Practices (UTP) Practices (RTP)

These practices involved the UTPs encompassed practices RTPs comprised agreements,

abuse of a dominant position in that were deceptive, misleading, arrangements, or practices

the market by one or more or fraudulent, leading to unfair among businesses that restricted

entities. MTPs included actions advantage or harm to consumers competition or hindered market

such as price manipulation, or competitors. Examples of entry. RTPs included actions such

refusal to deal & discriminatory UTPs included false advertising, as price-fixing, collusion, market-

pricing aimed at excluding misleading product claims, and sharing agreements, and tie-in

competitors or exploiting unfair competition tactics. arrangements.

consumers.

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 EXAMPLES

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 KEY OBJECTIVES OF THE MRTP ACT, 1969
PREVENTING MONOPOLIES PROMOTING FAIR COMPETITION
The MRTP Act aimed to prevent the concentration of economic The Act aimed to promote fair competition in the market by ensuring a

power in a few hands by regulating monopolistic practices that level playing field for businesses, preventing unfair trade practices, and

could stifle competition and harm consumer interests. fostering an environment conducive to innovation and efficiency.

CONTROLLING RESTRICTIVE TRADE PRACTICES PROTECTING CONSUMER INTERESTS

It sought to regulate and control restrictive trade practices such as It included provisions to protect consumer interests by prohibiting
price-fixing, collusion, and anti-competitive agreements that could limit deceptive advertising, false claims, and unfair competition tactics
market entry or unfairly disadvantage competitors. that could mislead or exploit consumers.

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 WHAT IS MRTPC?
MRTPC is an acronym for Monopolies and Restrictive Trade Practices Commission. The

regulatory authority was founded under the Monopolies and Restrictive Trade Practices (MRTP)
Act of 1969 in India. The MRTPC was responsible for enforcing the regulations of the MRTP Act

and settling conflicts concerning monopolies and restrictive trade practices. The entity had the

authority to investigate complaints, conduct inquiries, issue orders, and impose penalties on
entities that were found to be in breach of the Act. The MRTPC was essential in overseeing

monopolistic practices, deterring anti-competitive conduct, and safeguarding consumer welfare

in India until it was disbanded in 2009 following the implementation of the Competition Act, of
2002.

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 MRTP ACT & ECONOMIC REFORMS

Liberalization and Shift towards Promotion Of Market

Deregulation Competition Policy Efficiency
Indian economic reforms stressed Economic reforms reduced entry barriers,
The MRTP Act slowed economic
competitive policy to boost efficiency, increased competition, and strengthened
liberalization and deregulation in
innovation, and consumer welfare. The regulation to boost market efficiency. The
India. To promote competitiveness
2002 Competition Act replaced the Competition Act replaced the MRTP Act to
and openness to foreign investment,
MRTP Act and established a modern level the playing field for enterprises,
the MRTP Act's restrictive measures
competition law framework that encourage innovation, and boost economic
had to be repealed or amended.
promotes fair competition. efficiency in India.

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RISE OF A MODERN COMPETITION LAW
RAGHAVAN COMMITTEE & MODERN
COMPETITION LAW
• In the late 1990s, recognizing the limitations of the Monopolies and • Building on the recommendations of the Raghavan Committee, the Competition Act was

Restrictive Trade Practices (MRTP) Act in addressing contemporary enacted in 2002. The Act established the Competition Commission of India (CCI) as the

competition issues, the Indian government appointed a committee headed regulatory authority responsible for enforcing competition law and promoting fair

by Justice S.V. Raghavan to review and recommend reforms to competition competition in the Indian market.

law in India.
• The Competition Act introduced several key provisions, including prohibitions on anti-

• The Raghavan Committee submitted its report in 2000, proposing competitive agreements, abuse of dominance, and regulation of mergers and

comprehensive reforms to replace the MRTP Act with a modern acquisitions. It aimed to create a level playing field for businesses, stimulate innovation,

competition law framework. It recommended the enactment of a new and safeguard consumer welfare.

legislation, the Competition Act, to promote competition, prevent

• The enactment of the Competition Act marked a significant milestone in the
anti-competitive practices, and protect consumer interests.
development of modern competition law in India. It aligned India's competition law

regime with international best practices, fostering a more competitive market

environment and contributing to economic growth and consumer welfare.

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 THE TRANSITION

LIBERALIZATION
CCI
1969

MRTP ACT COMPETITION ACT

2002
MRTPC

ECONOMIC REFORMS

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 THE COMPETITION ACT,
2002
The Competition Act, implemented in 2002, superseded the obsolete Monopolies and

Restrictive Trade Practices (MRTP) Act, signifying a notable change in India's competition law

system. The Competition Act is designed to encourage fair competition, deter anti-competitive

behaviors, and safeguard consumer welfare in the market. The Competition Commission of

India (CCI) is established as the regulatory entity in charge of implementing competition law.

The Act bans collusion, and monopolistic behavior by companies, and oversees mergers and

acquisitions that could harm competition. The Competition Act in India aims to establish fair

competition among enterprises, promote innovation, and safeguard consumer welfare through
rigorous enforcement measures such as investigations and penalties.

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 KEY OBJECTIVES OF THE COMPETITION ACT,
2002
PROMOTE COMPETITION PROTECT CONSUMER INTERESTS
The Act aims to promote and sustain fair competition in The Act aims to safeguard consumer welfare by ensuring
the market by preventing anti-competitive practices. that markets operate efficiently, prices are competitive, and
consumers have access to a variety of choices.

PREVENT ANTI-COMPETITIVE PRACTICES REGULATE MERGERS & ACQUISITIONS

It seeks to prohibit agreements, abuse of dominant It provides for the regulation of mergers and acquisitions
positions by firms, and mergers and acquisitions that may to prevent combinations that could substantially lessen
adversely affect competition. competition in the market.

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 WHAT IS CCI?
The Competition Commission of India (CCI) is the regulatory body created under the
Competition Act of 2002. It is responsible for implementing competition law,
combating anti-competitive actions, and safeguarding consumer interests in the Indian
market. The Competition Commission of India (CCI) examines complaints regarding
anti-competitive practices, evaluates mergers and acquisitions, and advocates for
competition to enhance a competitive market atmosphere. The CCI is essential for
promoting fair competition, encouraging innovation, and protecting consumer welfare
in India.

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 KEY RESPONSIBILITIES OF CCI

• The CCI is responsible for enforcing the provisions of the • The CCI engages in competition advocacy activities to raise

Competition Act to prevent anti-competitive practices, promote awareness about the benefits of competition, educate stakeholders

fair competition, and protect consumer interests in the market. about competition law, and promote a competitive market culture

in India.
• It investigates complaints and cases related to anti-competitive

agreements, abuse of dominant positions by firms, and anti- • It provides guidance, recommendations, and advisory opinions to

competitive mergers and acquisitions to ensure compliance businesses, government agencies, and other stakeholders on

with competition law. competition-related matters, including compliance with

competition law and best practices.

• The CCI reviews mergers, acquisitions, and combinations to

assess their potential impact on competition in the market and • The CCI conducts market studies, research, and analysis to assess

prevent combinations that could result in a substantial lessening competition issues, identify market trends, and propose policy

of competition. recommendations to promote competition and consumer welfare.

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 COMPARISON BETWEEN MRTP &
COMPETITION ACT
A BRIEF ANALYSIS STUDY OF BOTH ACTS
MRTP ACT, 1969
• Enacted in pre-liberalization era
• The act aims to ensure that the operation of the
economic system does not result in the concentration of
economic power to the common detriment, for the
control of monopolies, or the prohibition of
monopolistic and restrictive trade practices.
• It prohibits monopolistic, restrictive, and unfair trade
practices.
• Based on reformative philosophy only
• No enabling provision to render an opinion to the
Central Government on such issues
• Prohibit monopolistic, restrictive, and unfair trade
practices
• Act implemented partly by the Central Government and
partly by the MRTP Commission
• Lacked autonomy and independence
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COMPETITION ACT, 2002
• Enacted in the post-liberalization era
• The act aims to prevent practices from having adverse effects
on competition, to promote and sustain competition in markets,
to protect the interests of consumers, and to ensure freedom of
trade carried on by other participants in markets.
• It seeks to prohibit anti-competitive agreements, and abuse of
dominant position and to regulate combinations
• Based on reformative-cum-deterrent Theory
• Central government can seek opinion on policy/law relating to
competition
• Prohibit anti-competitive agreements, abuse of dominant
position and regulate combinations
• The primary duty to achieve the objectives of the Act devolves
into a competition commission of India
• Comparatively more autonomous and independent
establishment of competition fund
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 BRIEF ON CASE STUDIES
A MRTP ACT EFFECT

THE CEMENT CARTEL CASE THE DLF CASE THE TATA ENGINEERING CASE
This prosecution accused many The MRTP Commission examined DLF, a Tata Engineering (formerly Tata Motors) was

cement makers of forming a cartel to major real estate developer, for abusing accused of abusing its commercial vehicle
control pricing and limit competition. its market dominance. The Commission market dominance by unfairly treating

MRTP judged cement companies' found that DLF had unfairly dealers and suppressing competition. The

price-fixing and market allocation discriminated against homebuyers, MRTP Commission fined Tata Engineering
agreements anti-competitive. Thus, reducing competition and injuring for anti-competitive activities under the

the Commission fined and ordered consumers. For violating the MRTP Act, MRTP Act. The case showed the

the corporations to stop their anti- DLF was ordered to stop its anti- Commission's responsibility in regulating
competitive actions. competitive conduct and pay fines. corporations for fair competition and

consumer welfare.

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 SUMMARY
1969, India passed the MRTP Act to regulate monopolies and prevent

trade restrictions. It restricted mergers and acquisitions, economic power

consolidation, and anti-competitive agreements. The Act made the

Monopolies and Restrictive Trade Practices Commission (MRTPC) its

regulator. In 2002, the Competition Act replaced the MRTP Act because it

was outmoded and insufficient to handle modern competition challenges.

The 2002 Competition Act modernized India's competition law by

replacing the MRTP Act. It promotes market fairness, prevents anti-

competitive practices, and protects consumers. The Act powers the

Competition Commission of India (CCI) to enforce competition law. It

outlaws anti-competitive mergers and acquisitions, agreements that restrict

competition, and firm misuse of dominant positions. Competitive markets,

economic efficiency, and consumer welfare in India depend on the

Competition Act.

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MEET THE TEAM

Pathak Harshil Gidhwani Kiran Parekh Pritesh

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 THANK YOU!
Your comments and inquiries
are now welcome!

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