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COMPETITION ACT 2012

Biswajit-Deevanshu-Vaibhav-Spriha-Lalit-Ashwani

Historical Development • • Constitutional Provisions -ownership and control of material resources -concentration of wealth & means of production Development Strategy After Independence and its Impact -strategy of planned economic development -1956 Resolution-industrialization-Govt intervention and regulation .

.Historical Development • Trigger Causes -Committee chaired by Mr Hazari-industrial licensing proceduresdisproportionate growth of some big business -Committee set up in 1960-distribution & levels of income-10% of population cornered 40% income -MIC in 1964-enjoined to enquire extent & effects of concentration of economic power in private hands-prevalence of monopolistic & restrictive trade practices.

Thrust of MRTP Act • • • • • the prevention of concentration of economic power to the common detriment the control of monopolies the prohibition of restrictive trade practices the prohibition of monopolistic trade practices the prohibition of unfair trade practices .

MRTP Act-Not Enough ● ● ● ● Restrictive Trade Practices Unfair trade Practices Monopolistic Trade Practices Post 1991 Economic Reforms .

collusion and Price Fixing Bid Rigging Predatory Pricing • • • • .Solution??-Competition Act • Anti Competitive Agreements a)Tie in agreement b)Exclusive supply agreement c)Exclusive distribution agreement d)Refusal to deal e)Resale price maintenance Abuse of dominance Cartel.

seizure . • .manipulate or destroy the document or information.● The amendment to section 41 of the act allows the director to search. raid or record the statement to facilitate the investigation as long as the Director General has the reason to believe that the person concerned has omitted or failed or would fail or would alter . • Such power can only be exercised with prior permission from CCI The time period for which any document or information seized can be retained by the director general is now left to his discretion .

Abuse of dominant position by an Enterprise or group. Stand Still Period is reduced. „turnover‟ is defined as the value of sale of goods and services. Specifically mentioning two words “jointly” and “singly” in section 4(1) of the act to prohibit the abuse. The Bill amends this definition to exclude any taxes levied on . • In Section 2.Competition Act 2012 • • Under section 31. The time period to pass an order or issue directions with respect to combination is 210 which is reduced to 180 days.

. ● Appointment of Members of Commission The procedure for selection and appointment of member of CCI proposed to be altered to include the chairperson of the CCI in the selection committee for selecting the committee.Competition Act 2012 • Opportunity of hearing before imposition of penalty Prior to the imposition of penalty by CCI .Under Section 27(b) of the act . • Size of the committee is reduced to 5 from 6.opportunity of hearing must be given to the party.

. •Different value or assets and turnover for class or classes of enterprise The Central Government has been empowered to specify different value of assets and turnover for any class or classes of enterprises under section 5(A).Competition Act 2012 •Provision of service included in the definition of vertical arrangement Section 3 (4) already deals with the provision of services along with sale of goods.

Competition Act 2012 •Intellectual property rights related exception to anti-competitive agreements. •Definition of term Group The definition of the term 'group' under the Act is a three prong test. namely (i) voting right test (ii) appointment of director test and/or (iii) control of management test under section 5. Provisions relating to anti-competitive agreements are defined under section 3(5) of the act. .

Miscellaneous Provisions •Power to Issue Interim Orders. •Power of Central Government to Issue directions and Supersede Commission. . •Appearance before Commission. •Execution of Orders of Commission Imposing Monetary Policy. •Rectification of Orders.

Advantages of Competition Act 2012 ØHelps to maintain fair competition in market ØPrevents formation of cartels. monopolies ØFair bids during auctions ØRegulation of mergers & acquisitions ØPower to impose penalty factor .

services and suppliers ii) Better quality and improved value for money. .Advantages (Contd.) ØRelatively more autonomy for the competition commission ØProactive & flexible ØA faster pace of invention and innovation a) Consumers: i) Wider choice of goods.

Redressal against anti competitive practices 3.Advantages (Contd. .Level playing field 2.Competitively priced inputs 4.Savings of public money in procurement 2. c) Governments (Central and State): 1.) b) Businesses: 1.Enhanced availability of resources for social sector.Greater productivity and ability to compete in global markets.

faster gathering of evidence •substantial powers to go after cartels •mandatory for the competition panel to decide on corporate mergers and acquisitions (M&A) within a stipulated time limit of 180 days .IMPACT OF THE PROPOSED AMENDMENTS •“Direct search and seizure”.

acts as a safeguard against misuse of economic power. •Maintaining the positive effect of competition in an economy's market. .CONCLUSION •competition is critical for economic development. and competition law seeks to protect this competitiveness in the economy.