COMPETITION ACT, Its objectives, prohibition of certain agreements, abuse of dominant position and regulation of combination

1. Competition Act,
2002
Bindu Kshtriya

2. Contents:
Objective
Anticompetitive agreements
Abuse of dominant position
Combinations
Regulation of combinations
Competition commission of India
Duties of commission

3. Objective
❖ To prevent practices having appreciable adverse
effect on competition.
❖ To promote and sustain competition in the market.
❖ To protect the interest of consumers.
❖ To ensure freedom of trade carried on by the
participants in the market.
❖ Establishment of Competition Commission of India.

4. Anti-competitive agreements (sec 3)
•No enterprise or association of enterprises or person or
association of persons shall enter into any agreement in
respect of production, supply, distribution, storage,
acquisition or control of goods or provision of services,
which causes or is likely to cause an appreciable
adverse effect on competition within India.
•Any agreement entered into in contravention of
provision of sub section 1 shall be void.

5. Anticompetitive Agreements may include such agreements as:
• Directly or indirectly determine purchase and sale price
• Limit or control production, supply, technical development and investment.
• Share the market by allocation of geographical area, type of goods and
type of customers.
• Manipulate the process of bidding
• Tie in agreement
• Exclusive supply agreement
• Exclusive distribution agreement
• Resale price maintenance
• Refusal to deal

6. Dominant position
“No enterprise shall abuse its dominant position”
Dominant position means position of strength , enjoyed by an enterprise,
in the relevant market in India which enables it to:
• Operate independent of competitive forces
• Affects its competitors or consumers in its favor.
“ Dominant position is decided keeping in view the market share and
size of enterprise.

7. There shall be abuse of
dominant position, if an
enterprise:
• Directly or indirectly impose unfair condition on purchase or sale of
goods or services.
• Limit production of goods or provision of services.
• Denies market access to certain person
• Making conclusion of contracts subject to acceptance by other parties of
supplementary obligations, which has the connection with the subject of
such contract.
• Utilization of dominant position in one relevant market to enter into, or
protection , another relevant market.

8. Section 5
• Acquisition
• Mergers
• Amalgamations

9. Threshold limit for determining whether a
combination becomes a combination subject to
scrutiny
1. Any acquisition, merger amalgamation which result
in combined assets of more than Rs 1,000 crore or
combined turnover of more than Rs 3,000 crore in
India.
2. If some business is carried outside India, then
combinations which result in combined assets inside
& outside India amounting to more than Rs 500
million US dollars or combined turnover of more than
1500 million US dollars

10. Continued..
3. If any acquisition, merger, amalgamation is
done in India by any enterprise which is a part of
group, if combined assets - Rs 4,000 crores and
combined turnover - Rs 12,000 crore
4. If any acquisition, merger, amalgamation is doe
by any enterprise which is a part of group and
some businesses also carried outside India, then
combination which result in combined assets -2
billion US dollars or combined turnover to 6 billion
US dollars.

11. COMPETITION COMMISSION OF INDIA
Establishment:
(1) With effect from such date as the Central Government may, by notification,
appoint, there shall be established, for the purposes of this Act, a Commission to be
called the "Competition Commission of India".
(2)The Commission shall be a body corporate by the name aforesaid having
perpetual succession and a common seal with power, subject to the provisions of
this Act, to acquire, hold and dispose of property, both movable and immovable,
and to contract and shall, by the said name, sue or be sued.
(3) The head office of the Commission shall be at such place as the Central
Government may decide from time to time.
(4) The Commission may establish offices at other places in India

12. Composition of
Commission
(1)The Commission shall consist of a Chairperson and not less than two and not
more than six other Members to be appointed by the Central Government.
(2) The Chairperson and every other Member shall be a person of ability, integrity
and standing and who has special knowledge of, and such professional experience
of not less than fifteen years in, international trade, economics, business,
commerce, law, finance, accountancy, management, industry, public affairs or
competition matters, including competition law and policy, which in the opinion of
the Central Government, may be useful to the Commission.
(3) The Chairperson and other Members shall be whole-time Members.

13. Selection Committee for Chairperson
and Members of Commission
The Chairperson and other Members of the Commission shall be appointed by the Central
Government from a panel of names recommended by a Selection Committee consisting of –
. a) the Chief Justice of India or his nominee
. b) the Secretary in the Ministry of Corporate Affairs
. c) the Secretary in the Ministry of Law and Justice
. d) two experts of repute who have special knowledge of, and professional experience in
international trade, economics, business, commerce, law, finance, accountancy,
management, industry, public affairs or competition matters including
competition law and policy

14. Term of office of Chairperson and other
Member
(1) The Chairperson and every other Member shall hold office as such for a term of five years from the date on which he
enters upon his office and shall be eligible for re-appointment:
[Provided that the Chairperson or other Members shall not hold office as such after he has attained the age of sixty-five
years]
(2) A vacancy caused by the resignation or removal of the Chairperson or any other Member under section 11 or by death or
otherwise shall be filled by fresh appointment in accordance with the provisions of sections 8 and 9.
(3) The Chairperson and every other Member shall, before entering upon his office, make and subscribe to an oath of office
and of secrecy in such form, manner and before such authority, as may be prescribed.
(4) In the event of the occurrence of a vacancy in the office of the Chairperson by reason of his death, resignation or
otherwise, the senior-most Member shall act as the Chairperson, until the date on which a new Chairperson, appointed in
accordance with the provisions of this Act to fill such vacancy, enters upon his office.
(5) When the Chairperson is unable to discharge his functions owing to absence, illness or any other cause, the senior-most
Member shall discharge the functions of the Chairperson until the date on which the Chairperson resumes the charge of his
functions.

15. Duties of Commission
Subject to the provisions of this Act, it shall be the duty of the Commission to
eliminate practices having adverse effect on competition, promote and sustain
competition, protect the interests of consumers and ensure freedom of trade carried
on by other participants, in markets in India:
Provided that the Commission may, for the purpose of discharging its duties or
performing its functions under this Act, enter into any memorandum or
arrangement with the prior approval of the Central Government, with any agency of
any foreign country.

16. TJANK YOU
BINDU KSHTRIYA