All You need to Know about Competition Commission of India

Brajesh Mohan
All You need to Know about Competition Commission of India

Why In News?

Google abused the dominant position of its Android operating system in India, using its "huge financial muscle" to illegally hurt competitors, the country's antitrust authority found in a report on its two-year probe seen by Reuters.

Alphabet Inc's Google reduced "the ability and incentive of device manufacturers to develop and sell devices operating on alternative versions of Android," says the June report by the Competition Commission of India's (CCI) investigations unit.

The CCI had in April 2019 ordered an investigation into the conduct of Google in the smartphone market over allegations that agreements that Google required smartphone manufacturers to sign to pre-install google play store restricted the ability of manufacturers to develop and sell alternative versions of android.

The commission had also noted that a requirement by Google that any manufacturer pre-installing the google play store on their devices also pre-install the entire suite of google apps was also prima facie a violation of competition law. Google is also facing a similar antitrust probe for its conduct in the smart television market.

In another News The Competition Commission of India (CCI) on Monday imposed a ₹200 crore penalty on Maruti Suzuki India Ltd, the country’s largest carmaker, for allegedly stifling competition with its policy of controlling the discounts dealers could offer consumers.

By Now you would have understood that why do we need to Know about CCI in Detail. This Article covers everything about CCI and Its Functions.

What is Competition Commission of India (CCI)?

Any economy thrives when there are free trade and fair competition in the market. Unfair competition practices like monopolies, cartels, etc. thwart the growth of smaller firms and businesses which are essential to the growth of an economy. The CCI protects such businesses from unfair competition and its adverse effects. It also ensures that the companies at fault are penalized and discouraged from such practices in the future.

By promoting competition it also benefits the consumers. The CCI will ensure there is no dominance of a few firms on the market. And both the small and big firms can co-exist peacefully in the economy.

Competition Commission of India (CCI) is a statutory body of the Government of India responsible for enforcing the Competition Act, 2002, it became functional in March 2009. The CCI functions as a market regulator by preventing and regulating anti-competitive practices in the country. It also carries out advisory and advocacy functions.

Background of Competition Commission of India:

The idea of Competition Commission was conceived and introduced in the form of The Competition Act, 2002 by the Vajpayee government. A need was felt to promote competition and private enterprise especially in the light of 1991 Indian economic liberalization

The Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act) was repealed and replaced by the Competition Act, 2002, on the recommendations of Raghavan committee.

The MRTP Act 1969 was aimed at curbing monopolies and preventing expansion of firms whose assets were more than ₹100 crore.

The Competition Act, 2002, as amended by the Competition (Amendment) Act, 2007, follows the philosophy of modern competition laws

The Act prohibits anti-competitive agreements, abuse of dominant position by enterprises and regulates combinations (acquisition, acquiring of control and Merger and acquisition), which causes or likely to cause an appreciable adverse effect on competition within India

Composition of CCI

The Commission consists of one Chairperson and six Members as per the Competition Act who shall be appointed by the Central Government.

The commission is a quasi-judicial body which gives opinions to statutory authorities and also deals with other cases. The Chairperson and other Members shall be whole-time Members.

Eligibility of members: The Chairperson and every other Member shall be a person of ability, integrity and standing and who, has been, or is qualified to be a judge of a High Court, or, has special knowledge of, and professional experience of not less than fifteen years in international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs, administration or in any other matter which, in the opinion of the Central Government, may be useful to the Commission.

  • Eliminate practices having adverse effect on competition
  • Promote and sustain competition
  • Protect the interests of consumers
  • Ensure freedom of trade in the markets of India
  • Establish a robust competitive environment

The Competition Commission of India takes the following measures to achieve its objectives:

Consumer welfare: To make the markets work for the benefit and welfare of consumers.

Ensure fair and healthy competition in economic activities in the country for faster and inclusive growth and development of the economy.

Implement competition policies with an aim to effectuate the most efficient utilization of economic resources.

Develop and nurture effective relations and interactions with sectoral regulators to ensure smooth alignment of sectoral regulatory laws in tandem with the competition law.

Effectively carry out competition advocacy and spread the information on benefits of competition among all stakeholders to establish and nurture competition culture in Indian economy.

Functions of CCI

To eliminate practices having adverse effect on competition, promote and sustain competition, protect the interests of consumers and ensure freedom of trade in the markets of India.

To give opinion on competition issues on a reference received from a statutory authority established under any law and to undertake competition advocacy, create public awareness and impart training on competition issues.

The Competition Commission is India’s competition regulator, and an antitrust watchdog for smaller organizations that are unable to defend themselves against large corporations.

CCI has the authority to notify organizations that sell to India if it feels they may be negatively influencing competition in India’s domestic market.

The Competition Act guarantees that no enterprise abuses their 'dominant position' in a market through the control of supply, manipulating purchase prices, or adopting practices that deny market access to other competing firms.

A foreign company seeking entry into India through an acquisition or merger will have to abide by the country’s competition laws.
  • Assets and turnover above a certain monetary value will bring the group under the purview of the Competition Commission of India (CCI).

Need of CCI

Promote free enterprise: Competition laws have been described as the Magna Carta of free enterprise. Competition is important for the preservation of economic freedom and our free enterprise system.

Protect against market distortions: The need for competition law arises because market can suffer from failures and distortions, and various players can resort to anti- competitive activities such as cartels, abuse of dominance etc. which adversely impact economic efficiency and consumer welfare.
  • Thus, there is a need for competition law to provide a regulative force which establishes effective control over economic activities.
Promotes domestic industries: During the era in which the economies are moving from closed economies to open economies, an effective competition commission is essential to ensure the continued viability of domestic industries, carefully balanced with attaining the benefits of foreign investment increased competition.

Post a Comment


Post a Comment (0)

#buttons=(Accept !) #days=(20)

Our website uses cookies to enhance your experience. Check Now
Accept !