COMPETITION COMMISSION OF INDIA

[Mr. M. GOVINDARAJAN]

INTRODUCTION:

                        Competition Act, 2002 ('Act' for short) has been enacted to provide keeping in view of economic development of the country for the establishment of a Commission to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carrying on by other participants in markets, in India, and for matters connected therewith  or incidental thereto.   Even though the Act has got the consent of the President in the year 2002 all the provisions of the Act has not made effective from the year 2002.   The constitution of the Competition Commission of India (Commission' for short) has been challenged before the Court.  The Government brought amendments to the constitution of Competition Commission of India during the year 2007 and the provisions relating to the commission came into effect from 12^th October, 2007.

ESTABLISHMENT OF COMMISSION:

                        With effect from such date as the Central Government may, by notification appoint, there shall be established, for the purposes of this Act a Commission to be called 'Competition Commission of India'.  The Commission shall be a body corporate having perpetual succession and a common seal with power, subject to the provisions of this Act, to acquire, hold and dispose of property, both moveable and immoveable and to contract and shall, by the said name, sue or to be sued.  The head of the Commission shall be at Delhi. 

COMPOSITION:

                        The Commission shall consist of a Chairperson and not less than two and not more than six other members to be appointed by the Central Government.  The Chairperson and other members of the Commission shall be appointed by the Central Government from a panel of names recommended by a committee.  The Chairperson and every other member shall be a person of ability, integrity and standing and who has special knowledge of, and such professional experience of not less than fifteen years in international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs of competition matters, including competition law and policy, which in the opinion of the Central Government, may be used to the Commission.   The Chairperson and other members shall be the whole time members.

                        The Chairperson and every other member shall hold office as such for a term of five years from the date on which he enters upon his office and shall be eligible for reappointment.  The Chairperson or other members shall not hold office as such after he has attained the age of sixty five years.    A vacancy caused by the resignation or removal of the Chairperson or any other member or by death or otherwise shall be filled by fresh appointment.  In the event of the occurrence of a vacancy to the office of the Chairperson by reason of his death, resignation or otherwise, the senior most member shall act as the Chairperson, until the date on which a new Chairperson, appointed and enters upon his office.  When the Chairperson is unable to discharge his functions owing to absence, illness or any other cause, the senior most member shall discharge the functions of the Chairperson until the date on which the Chairperson resumes the charge of the functions. 

                        The Chairperson and other members shall not, for a period of two years from the date on which they cease to hold office, accept any employment in, or connected with the management or administration of, any enterprise which has been a party to a proceeding before the Commission under this Act. 

                        The Commission shall meet at such times and such places, and shall observe such rules of procedure in regard to the transaction of business of meeting as may be provided by regulations.  All questions which come up before any meeting of the Commission shall be decided by a majority of the Members present and voting, and in the event of equality of votes, the Chairperson or in his absence, the Member presiding shall have a second or casting vote.

OFFICERS OF COMMISSION:

                        The Central Government may, by notification, appoint a Director General for the purpose of assisting the Commission in conducting inquiry into contravention of any of the provisions of this Act and for performing such other functions as are, or may be, provided by or under this Act.  The number of other Additional, Joint, Deputy or Assistant Directors General or such officers or other employees in the office of Director General may be appointed as prescribed.

REFERENCE:

                        Where in the course of a proceeding before any statutory authority an issue is raised by any party that any decision which such statutory authority has taken or proposes to take, is or would be, contrary to any of the provisions of this Act, then such statutory authority may make a reference in respect of such issue to the Commission.  Any statutory authority, may, suo motu, make such a reference to the Commission.   On receipt of such reference, the Commission shall give its opinion, within sixty days of receipt of such reference, to such statutory authority which shall consider the opinion of the Commission and thereafter, gives its findings recording reasons therefore on the issues referred to in the said opinion.

                        Where in the course of a proceeding before the Commission an issue is raised by any party that any decision which, the Commission has taken during such proceeding or proposes to take, is or would be contrary to any provision of this Act whose implementation is entrusted to a statutory authority, then the Commission may make a reference in respect of such issue to the statutory authority.  The Commission, may, suo motu, make such a reference to the statutory authority.   On receipt of reference from the Commission, the statutory authority shall gives its opinion, within sixty days of receipt of such reference, to the Commission which shall consider the opinion of statutory authority, and thereafter give its findings recording reasons therefore on the issues referred to in the said opinion.

DUTIES OF COMMISSION:

                        Subject to the provisions of this Act, it shall be the duty of the Commission to eliminate practices having adverse effect on competition, promote and sustain competition, protect the interest of consumers and ensure freedom of trade carried on by other participants, in markets in India.   The Commission may, for the purpose of discharging its duties or performing its functions under this Act, enter into any memorandum or arrangement, with the prior approval of the Central Government, withy any agency of any foreign country.

                        The provisions of Sec. 19 give power to the Commission for the inquiry into certain agreements and dominant position of enterprises.  Sec. 26 deals with the procedure for inquiry under Sec. 19.  Sec. 27 deals with the orders by Commission after inquiry into agreement or abuse of dominant position.  Sec. 28 deals with the division of enterprise enjoying dominant position by the order of Commission.  The provisions of Sec. 20 give power to the Commission for the inquiry into combinations.  Sec. 29 of the Act deals with the procedure for investigation of combinations.  Sec. 31 deals with the orders by Commission on certain combinations.   Sec. 39 deals with execution of orders of Commission imposing monetary penalty.

POWERS OF COMMISSION:

The Commission shall, notwithstanding that-

 

An agreement  (anti competitive agreement) has been entered into outside India; or

Any party to such agreement is outside India; or

Any enterprise abusing the dominant position is outside India; or

A combination has taken place outside India; or

Any party to combination is outside India; or

Any other matter or practice or action arising out of such agreement or dominant position or combination is outside India

Have power to inquire in accordance with the provisions of this Act into such agreement or abuse of dominant position or combination if such agreement or dominant position or combination has, or is likely to have, an appreciable adverse effect on competition in the relevant market in India and pass such orders as it may deem fit in accordance with the provisions of this Act.

                        Where during an inquiry, the Commission is satisfied that an act in contravention of Sec. 3(1) or Sec. 4(1) or Sec.6 has been committed and continues to be committed or that such act is about to be committed, the Government may, by order, temporarily restrain any party from carrying on such act until the conclusion of such inquiry or until further orders, without giving notice to such party, where deems it necessary.

                        In discharge of its functions, the Commission shall be guided by the principles of natural justice and, subject to the other provisions of this Act and of any rules made by the Central Government, the Commission shall have the powers to regulate its own procedure.   The Commission shall have, for the purpose of discharging its functions under this Act, the same powers as are vested in a Civil Court under the Code of Civil Procedure, while trying a suit in respect of the following matters:

 

Summoning and enforcing the attendance of any person and examining him on oath;

Requiring the discovery and production of documents;

Receiving evidence on affidavit;

Issuing commissions for the examination of witnesses or documents;

Requisitioning, subject to the provisions of Sec. 123 and 124 of the Indian Evidence Act, 1872 any public record or document or copy of such record or document from any office;

The Commission may call upon such experts, from the fields of economics, commerce, accountancy, international trade or from any other disciplines it deems necessary to assist the Commission in the conduct of any inquiry by it.

The Commission may direct any person-

 

To produce before the Director General or the Secretary or an officer authorized by it, such books or other documents in the custody or under the control of such person so directed as may be specified or described in the direction, being documents relating to any trade, the examination of which may be required for the purposes of this act;

To furnish to the Director General or the Secretary or any other Officer authorized by it, as respects the trade or such other information as may be in his possession in relation to the trade carried on by such person, as may be required for the purposes of this Act.

RECTIFICATION OF ORDERS:

With a view to rectifying any mistake apparent from the record, the Commission may amend any order passed by it  under the provisions of the Act.  The Commission may make-

 

An amendment on its own motion;

An amendment for rectifying any such mistake which has been brought to the  notice by any part to the order.

The Commission shall not, while rectifying any mistake apparent from record amend substantial part of its order passed under this provisions of this Act.

REPRESENTATION:

                       A person or an enterprise or the Director General may either appear in person or authorize one or more Chartered Accountants or Company Secretaries or Cost Accountants or Legal practitioners or any of his or its officers to present his or its case before the Commission.  Thus it is the core area for practising professionals.