Event: 3rd BRICS International Competition Conference 2013 Organizer: Competition Commission of India (CCI) Source: http://www.bricsdelhi2013.in/ Date: 20-22 November 2013 Venue: New Delhi Summary: Inaugurated by then Prime Minister of India, Mr. Manmohan Singh, BRICS International Competition Conference is one of the most prestigious conferences in the field of competition law and policy. The conference was organized in pursuance of New Delhi Declaration and Action Plan adopted at fourth BRICS Leaders Summit in New Delhi on March 29, 2012. The conference was third in the series with the earlier two BRICS International Competition Conferences having been organized in Kazan, Russia and Beijing, China respectively. The theme of the 3rd Conference was “Competition Enforcement in BRICS Countries: Issues and Challenges”. Note: Please visit www.compad.in for more information

1. 3rd BRICS International Competition Conference
November 20-22, 2013, New Delhi
Abstract
Dhanendra Kumar
Principal Adviser, Indian Institute of Corporate Affairs (IICA) and Chief Mentor, School of Competition Law, IICA
Session III: Competition Enforcement and State Owned Enterprises: Creating Level Playing field
Competition Enforcement and State Owned Enterprises: Creating Level Playing Field
In 1954, while inaugurating the Bhakra Nangal dam, the then Prime Minister Jawahar Lal Nehru christened the same as the ‘temple of modern India’, and so were born the India’s modern temples – the State Owned Enterprises (SOEs) that were expected to reach commanding heights, build the badly needed vast infrastructure after independence and make India economically self-reliant.
It was the Industrial Policy Resolutions and the Five Year Plans that embarked the journey of SOEs in India. A large number of SOEs were set up across various sectors and they played a significant role in the overall growth and development of the nation. They transformed the economy from agro-based to industry led and contributed heavily to various capital intensive and core sectors of the economy such as oil and gas, defence, steel, mining, telecommunications etc. Moreover, their contribution in rural and far-flung areas which were then considered risky and unviable by many cannot be overemphasized.
The 1991 reforms led to the creation of newer markets and enhanced participation of the private players. It was widely perceived that the mere existence of liberal trade and investment policies, unless complemented with strong regulatory and competition policy regime, may not be able to create conducive business environment.

2. The adoption of new competition law regime in India through the enforcement of Competition Act, 2002 (as amended in 2007) in May 2009 has witnessed multiple cases involving SOEs- both in the capacity of an informant as well as the opposite party before the CCI. The Act covers within its ambit both the private enterprise and the government departments (excluding atomic energy, currency, defence and space), in their economic/commercial activities (as distinct from Government’s sovereign obligations, subsequently clarified in a High Court judgement as primary, inalienable and non-delegable), and SOEs. The CCI had found prima facie ground to initiate an inquiry in many of the complaints received against the state departments and SOEs in varied sectors including the railways, coal, oil companies, mining companies, metro rail corporations, Steel companies etc. The Act and subsequent jurisprudence has laid ground for competitive neutrality in this regard. However, at times there are also some grievances of SOEs of reverse discrimination when they have to fulfil certain government directives and social obligations and others not.
The challenges posed with the enforcement of the Act in the functioning of SOEs are numerous, which include wide interpretation of the term ‘enterprise’, scrutinizing anticompetitive conduct, establishing dominance and its abuse, and regulating combinations.
The High Court of Delhi, in Union of India v CCI, recognized ‘Railway’ as an enterprise covered within the ambit of Competition Act, 2002 and also highlighted the clear distinction between sovereign and non-sovereign functions of the government for the purpose of application of the Act, as elucidated above. In Royal Energy Ltd vs. M/s Indian Oil Corporation Ltd & Ors, it was observed, even if anticompetitive conduct flows from any policy of the government, the Commission will still have jurisdiction to examine the impugned act. However, these are areas on which the proposed National Competition Policy, still under the consideration of the Government, has also addressed
In my address I shall briefly deliberate upon the prevailing scenario in this regard, and the specific challenges which are confronted by the SOEs with the enforcement of new competition law regime in India. I shall also reflect upon the areas/sectors where both private and public sector enterprises can play a significant complementary role yet having a healthy competition in the best interests of economy.