THE COMPETITION ACT(2002)

ABHISHEK SAXENA
Presented By
ABHILASH DUPARGUDE
KEHKASHA SHAIKH
SHRIYA THAKUR
AJINKYA CHANGEDE
 Competition Act 2002 History

 The Govt. Of India introduced the bill in 2001.

 Bill passed in Dec 2002.

 On 13 Jan 2003 The President of India gave his assent.

 Competition Commission Of India(CCI) is advocacy for competition Act 2002.

 It replaces Monopolies and Restrictive Trade Practices Act 1969.

 Objectives Of Competition Act 2002

Competition Act 2002 notified in Jan 2003 for establishment of a commission.

Objectives
 Eliminate practices having adverse effect on competition.

 Promote & sustain competition.

 Protect interests of consumers.

 Ensure the freedom of trade carried on by other participants of the market.(see

sec 18)
Main Features Of Competition Act 2002

 Prohibits anti competitive arguments. (Sec 3)

 Prohibits abuse Dominant positions. (Sec 4)

 Provides the Regulations of combinations.(Sec 5&6)

 Enjoins Competition Advocacy.(sec 49)

Anti Competitive Agreements phase 1st

There are two types

 Horizontal & Vertical

 Agreement amongst competitors (horizontal agreements),including cartels.

Cartels presumed to have appreciable adverse effect on competition. Cartels are

The most pernicious violation.
Fix pricing, market sharing, limiting production, supply etc.bid rigging , collusive
bidding.
Anti Competative Agreements phase 2nd

Agreements
Agreements such as between manufacturer and distributor(vertical agreement)–
subject to Rule to reason; burden of proof lies on prosecutor .

Tie in arrangements,exclusive supply/distribution agreement,refusal to

deal,resale
price maintenance.

Agreement includes arrangement or understanding, oral or in writing not

necessarily enforceable by law.
[sec 3]
Anti Competitive agreements Example

Global lysine cartel, decided in US in( 1996)---turning point in anti cartel action
5 firms (2 japanese,2 S. Korean,1 US) prosecuted for forming cartels and fixing
Prices for five years.
High penalties imposed ;ADM(cartel leader) fined $100m.
 Rigorous investigation with the help of FBI.
Major role of economic analysis in calculation of overcharge.
Issues Direct evidence is usually difficult.might required search and seizure
operation as per section41.might necessitate reliance on circumstantial evidence
leniency provision.
Injury caused to developing countries by global cartels.
CompetitionAct –An Economic Law

Economic concepts/analysis fundamental to the law:

Relevant market—Relevant product market, relevant geographic market.(SSNIP test)

Dominant position.(Abuse Of Dominance)

AAEC- Appreciable Adverse Effects n competition by agreements/Abuse Of

Dominance.

AACE by combinations.(HHI,CR)
Thank yo
u!