competion _history
TRANSCRIPT
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HISTORY OFCOMPETITION LAWIN INDIA
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left the Indianeconomy crippled.
left the Indianeconomy crippled.
British rule inIndia
FIGHTINGECONOMICCOMPETITION
FIGHTINGECONOMICCOMPETITION
After
Independence dream destination forcelebrating theadvantages ofGlobalization andLiberalization
dream destination forcelebrating theadvantages ofGlobalization andLiberalization
Situation
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INDIANECONOMY
Thetechnologicaland scientific
capabilities were
poor
industrializationwas limited and
lopsided
Agriculturalsector -feudal
and semi-feudalinstitutions,
resulting intolow productivity
Poverty andunemployment
Neitherresources norskilled work
force
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Mainconcern
Industry
NarasimhaGovt.
Unemployment poverty, agriculture-5 year plan-
industry - 5 year plan 2
Labour laws-
Bt concern was welfare ofpeople and growth of nation asa whole- strengthen nation
Entry exit barriers
Liberalisation-
Market open to foreigncountries
competition
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MIC
MIC appointed under Commission of Inquiry Act, 1952
Scope of inquiry - extent and effect of concentration of economic powers in private hands.
MIC to suggest legislation and other measures to protect essential public interest and alsosuggest agency for enforcement of the legislation
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Adverse socialeffects ofeconomicconcentration
Governmentpolicies one ofthe main causesof economicconcentration
New technology
scale ofproduction
War efforts ofIndia
Political largesse Large number ofindustries hadeither singlesupplier or onesupplier havinglarge share of
market. Collusivebehaviour incertain sectors
Entry barriercreated by privateplayers
Evidence ofpredatory pricing
Many publicsector enterprisesenjoyedmonopoly
Many restrictivetrade practices
(RTP) prevalent
FINDINGIGS OFMIC
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Setting up public sector enterprises in sectors which have littlecompetition
Proposed an autonomous Commission headed by a Judge to
implement a new law-( investigative + punitive )
Scope of merger control limited to merger involving a dominantenterprise (at least 1/3 of share in production/ supply/distribution)
All proposals for expansion by dominant enterprises to be approved bythe proposed
IPRs to be under the purview of the proposed law.
Recommendations of MIC
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SACHAARCOMMISSION-
1977
Reviewed theworking ofMRTPC
during the period1970-77
Found that the
actual role ofMRTPC was limited
and mostlyadvisory
The Government
had not made useof the expertise few references toMRTPC for opinion
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RECOMMENDATIONS OF THE SACHARCOMMITTEE Definition of dominant enterprise to be changed enterprises with market
share to be termed dominant Harmonization of definition of goods in theMRTP Act with the Sale ofGoods Act Inter-connected undertakings concept to be introduced to theMRTP Act Government Undertakings to be brought under purview ofMRTPC Compulsory reference by the Central Government onMTPs toMRTPC AllM&As to be referred for advise ofMRTPC, if the Central Government sodesires. Division of enterprises-MRTPC to pass final orders if the Central Governmentreferred the matter to it. Certain Unfair Trade Practices (UTPs) like misleading advertisements to be
inserted in the Law Power to compensate against injury Power to grant interim injunction Power of contempt Investigating arm to be provided more teeth by powersof conducting down raids and limited Civil Court powers
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1984 AMENDMENT TO MRTP ACT
Many deviations from the recommendations of the Sachar Committee
Concept of deemed illegality to host of trade practices introduced
Exclusionary behaviour, tie in sale, re-sale price maintenance, bid rigging, allocation of
market, boycott predatory pricing etc.
Registration of agreements by dominant enterprises made mandatory
Mis-representation as well as misleading or disparaging advertisement included
Provisions prohibiting UTPs introduced
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1991 AMENDMENT TO THE MRTP ACT
Provisions dealing with monopolistic enterprises seeking prior Government approval
deleted
Government Undertakings, Government Corporations and Government owned
Companies brought under the purview of theMRTP Act by notification
Granting of injunction without issue of notice to the effective parties
PROVISIONS IN PRESENT MRTP ACT
Has jurisdiction in RTP & UTP 14 practices are deemed RTP
MTP if referred or suo moto, but can only recommend to Government
M& A were deleted in 1991
Can grant temporary injunction
Has powers of contempt
For disobedience,MRTPC must complain to criminal court
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RAGHAVAN COMMITTEE A high level Committee on Competition Policyand Law set up in 1999. recommending a suitable legislation framework which could either be a new law orappropriate amendments to theMRTP Act
FINDINGS OF THE RAGHAVAN COMMITTEE
Word competition used sparsely in theMRTP Act only twice Absence of precise definition e.g. Cartels Inadequate to deal with implementation of the WTO Agreements No specific powers under theMRTP Act to deal with mergers
Inadequate in dealing with anti-competitive practices as in other modern competitionlaw Expedient to have a new Competition Law
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COMPETITTION ACT- 2002
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(as indicated in Preamble)
keeping in view the economic development of the country,
to prevent practices having appreciable adverse effect on competition;
to promote and sustain competition in trade and industry:
to protect the interest of consumers;
to ensure freedom of trade carried on by the participants in markets in India;
Objectives to be achieved through the establishment of the Competition Commission of
India (CCI).
OBJECTIVE
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AMENDMENT OF 2006
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THANK YOU- by
Aruna