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Competition Bills |
Competition Bills
The Competition Law Bill, 2001 was introduced on August 6, 2001, to amend the MRTP Act, 1969 and to propose a modern competition law. The Bill is mainly based on the recommendations of a high level Committee. It was referred to the standing committee of Parliament. The Competition Law Bill, 2001 was subsequently passed in 2002. The Competition Act in 2002 was enacted by the government, considering the economic developments in the nineties which required that the Indian market be prepared to face competition from within the country and outside. Section 7 (1) of the Act provides for the establishment of the Competition Commission of India to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ascertain freedom of trade carried on by other participants in markets.
However, before the Competition Commission of India (CCI) could be made functional, a writ petition was filed before the Hon’ble Supreme Court against certain provisions of the Competition Act, Rules framed there under and the selection of the Chairperson and Member. The Hon’ble Supreme Court delivered its judgement and closed the writ petition declining to pronounce on the matters argued before it and left open all questions regarding the validity of the Competition Commission of India (CCI) to be decided after the proposed amendment of the Act.
Considering the judgement of the Hon’ble Supreme Court, the Competition (Amendment) Bill, 2006 was introduced in Lok Sabha on the 9th March, 2006 with an intention to make the Competition Commission of India (CCI), a market regulator for preventing anti-competitive practices and to establish a Competition Appellate Tribunal. The Bill was referred for examination and report to the Parliamentary Standing Committee on Finance. The Committee presented its report to both the Houses of Parliament on 12.12.2006. The Competition (Amendment) Bill, 2007 was introduced after withdrawing the Competition (Amendment) Bill, 2006. Taking into account the recommendations of the Committee and the legal challenges, to separate the regulatory and adjudicatory functions of the CCI in line with the directions given by the S.C and to make the CCI fully operational on a sustainable basis, the Competition (Amendment) Bill, 2007 has been introduced and it has been passed by both the houses of Parliament.
In the wake of the recent international economic developments, particularly, relating to competition laws, the Monopolies and Restrictive Trade Practices Act, 1969 has become outdated in certain respects and need has arisen to shift focus from curbing monopolies to promoting competition. The Central Government constituted a high level Committee which submitted its report to the Government and after considering the report and consulting the trade and industry, the Government enacted the Competition Bill, 2001. In order to guarantee fair competition by privatising trade practices, which have negative impact on market, the Bill seeks to create a quasi-judicial body called Competition Commission of India (CCI). The Commission shall also undertake Competition advocacy for creating awareness and imparting training on competition issues.
The major changes proposed in the Competition (Amendment) Bill, 2007 are:
- Mandatory Notification of Combinations (mergers and acquisitions etc.)
- Recommendation of the Standing Committee.
- Difficulty in undoing a merger which has already taken place.
In voluntary regime, some cases might escape the attention of the Commission
Most of the countries in the world follow the mandatory regime (more than 100).
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