Professional Documents
Culture Documents
KUMUDHA RATHNA
Also, all over the world, it was found that private monopolies can
be detrimental to national economy & control was required. Fair &
free competition is required for growth of a healthy economy.
SUGGESTION OF RC:
The Act was introduced at a time when large MNCs were taking
advantage of Indias liberalized economic policy, permitting greater
participation of overseas companies in economic activities in India.
Indian industry, used to protection, belatedly recognized the gross
inequality between them & the MNCs-in terms of size & experience
& Govt. endeavoured to set up a level playing field by means of this
Enactment.
The progress of this Act was stymied thru BRAHIM DUTT V. UOI
filed in the SC-challenging the authority of the Central Govt. to
appoint the Chairperson & member of the CCI (Qualification for the
Chairperson-A person of ability, integrity & standing who-(i)has
been/is qualified to be a Judge of HC or (ii)has spl knowledge of &
professional experience of not less than 15 yrs in international
trade, economics, business, commerce, Law, Finance,
accountancy, management, industry, public affairs, admn or in any
other matter, which in the opinion of the C.Govt. may be useful to
the Commission).
Ground of Challenge-
SC was satisfied with the response of the C.Govt. & closed the WP
on Jan.2005 sans pronouncing on the issues raised & left open all
questions regarding the validity of the Enactment to be decided
after the amendments of the Act, if there came up any challenge to
the amended Act.
In the light of the Order of the SC, the C.Govt. introduced into
Parliament-the Competition (Amendment) Bill, 2006. The bill was
referred to the Parliamentary Standing Committee on Finance
(2006-07) & after taking into account its recommendations, the
Competition (Amendment) Bill, 2007 was introduced into
Parliament & after approval by both Houses, the Competition
(Amendment) Act, 2007 received the assent of the President on
24th.Sept.2007.
Sl.
MRTP ACT COMPETITION ACT
No.
Tribunal (CAT) was established with provision for a further appeal to SC. Thus,
Competition Act is an improvement on MRTP Act.
Unit/division-includes-plant/factory-established for-production,
storage, supply, distribution, acquisition, control-of any article,
goods-any branch/office/established for provision of any service.
Goods-as defined in the Sale of Goods Act, 1930 & includes-
Products manufactured/processed/mined;
Debentures/stocks/shares (after allotment);
In relation to goods supplied, distributed or controlled in
India, goods imported into India].
No Exemption to: Public Sector Undertakings (PSU) & enterprises
controlled by Govt.
4) PERSON: [S.2 (l)]:
Includes-
Individual;
HUF;
Company;
Firm;
Association of persons or body of individuals (whether
incorporated or not in India or outside India);
Any corpn established by/under any Central, State or
Provincial Act or Govt. Co. as defined in s.617 of the
Companies Act, 1956;
(S.617: Where not less than 51% of the paid-up share capital
of the Co. is held by the C.Govt. or any S.Govt. or by both of
them. Same applies to corpns established by any Central,
State, Provincial Act.)
Any body corporate incorporated by/under the Laws of a
country outside India;
Dr. KUMUDHA RATHNA
keep fixed deposit with Bank while allotting him a locker (as
there is direction of RBI not to insist on bank deposit for locker).
AMAR JEEVAN PUBLIC SCHOOL, In Re School making it
compulsory to buy uniforms & books only from its own shop.
UNITED RADIO & TELEVISION Co, In Re Compelling
CASE LAW:
CALCUTTA GOODS TRANSPORT ASSOCIATION v.
Newspapers are exempt from s.39 & 40 (i.e., they can prescribe
minimum price). REASON-This is because speed is essence of
publishing a newspaper. Allowing retailer or vendor to bargain
the price would delay the process of reaching consumers fast.
This will reduce circulation, which will lead to reduction in
quality & also increase in costs. This will not being long term
interest of public.
DIRECT PRICE MAINTENANCE PERMITTED: Permitted.
Meaning: Where the manufacturer sells goods through its own
retail shops & fixes prices to be charged in such shops (Eg: Bata,
Gwalior etc retail shops). Fixing price in such shops is not
prohibited.
F. REFUSAL TO DEAL: [S.4-Expln (d)]:
Includes-any agreement which restricts/likely to restrict-by any
method-the persons/classes of persons to whom goods are sold or
from whom goods are bought.
Dr. KUMUDHA RATHNA
Definitions:
Definition:
The dictionary meaning of the word dominant is
overriding/influential.
In simple terms, abuse of dominant position refers to the conduct
of an enterprise that enjoys a dominant position (as defined by the
Act).
In substance-dominant position-means the position of strength
enjoyed by an enterprise that enables it to act independently of
competitive forces prevailing in the relevant market. Such an
enterprise will be in a position to disregard market forces &
unilaterally impose trading conditions, fix prices etc.
The elements that constitute a dominant position are:-
A position of strength;
That position being enjoyed in a relevant market in India;
Dr. KUMUDHA RATHNA
CONSUMER [S.2(e)]:
Eg: If prices fall in the market, for reasons not the action of an
enterprisea-a reduction in the price by that enterprise to match its
prices to the new prices cannot be termed unfair/predatory pricing.
Transfer/vesting of pty/rights/liabilities/obligations;
Adjustment of contracts either by discharge or reduction of
liability/obligation or otherwise;
Creation/allotment/surrender/cancellation of any shares /
stocks or securities;
Formation/winding-up of an enterprise or the amendment of the
MoA or AoA or any other instrument regulation the business of
any enterprise;
Extent to which, & the circumstances in which, provision of the
Order affecting an enterprise may be altered by the enterprise &
the registration thereof;
Any other matter which may be necessary to give effect to the
division of the enterprise.
Enquiry by CCI:
Suo Motu OR
On receipt of any info (in the manner & with fee as determined
by regulations)-from any person/consumer/their association or
trade association OR
On a reference made to it by C.Govt/St.Govt/Statutory
authority [S.19(1)].
CASE LAW:
the very least during relatively long periods, that freedom of action
which is the special feature of a DP.
Court Ruled-
o The purchaser from Tetra Pak was to ensure that his buyer
assumed his obligations to Tetra Pak. Breach of this
condition entailed a penalty.
COMBINATIONS:
COMBINATION-MEANING:
substitutable
goods/service) [S.5(b)(i)]
Acquisition by a group with Group assets over Rs.4K Group assets over $2
similar / identical / Crores / turnover over Billion /turnover over $6
substitutable goods / Rs.12K Crores Billion.
services [S.5(b)(ii)]
Merger / amalgamation of Combined assets over Combined Assets over
2 enterprises (goods / Rs.1K Crores / turnover $500 Million / turnover
services may be similar / over Rs.3K Crores. over $1,500 Million
dissimilar) [S.5(c)(i)]
Merger / amalgamation in Combined assets over Combined assets over $2
a group (goods / services Rs.4K Crores / turnover Billion / turnover over $6
maybe similar/dissimilar) over Rs.12K Crores. Billion.
As per s.4A of the Companies Act-all bodies (eg. ICICI, IFCI, IDBI,
LIC, UTI) are Public Financial Institutions. Also includes
Securitisation Company & Asset Reconstruction Company
registered with RBI under Securitisation Act, 2002.
Combination not effective for 210 days from date of notice, or till
CCI issues order u/s.31:
The combination shal not come into effect until 210 days or order
of Commission u/s.31is recd, whichever is earlier.
U/s.31, Commission can either-
Approve the combination or
Order that the combination shall not be effective or
Propose modifications in the combination.