Functional competition policy india pdf

All those interested in these important and largely unresolved issues will find it an invaluable source of. This book paints a bold and inspiring scenario of India becoming an affluent society by , that is, within a generation from now. It makes a persuasive case as to why such a scenario could be plausible. Even more importantly, the book very appropriately and frankly assess the many hurdles — political, social, policy and institutional — that the country must overcome to realize this vision and lift millions of Indians from relative poverty today to enjoy the fruits of a modern and.

This groundbreaking book offers a critical and wide-ranging assessment of the global air transport liberalization process over the past 40 years. This compilation of world experts on air transport economics, policy, and regulation is timely and significant, considering that air transport is currently facing a series of new challenges due to technological changes, the emergence of new markets, and increased security concerns.

A celebration of professor V. Rao, this book is a compilation of articles on contemporary issues written by eminent economists from around the globe, including Michael Walton from Harvard University, Sugata Marjit from City University of Hong Kong, and G. Samanta from the Reserve Bank of India.

In the wake of the changing course of global trade, this book studies the key and emerging trade policies and negotiation issues faced by India in international trade and offers policy options for development. India, the founder-member of the WTO, has been forced to reverse the trade liberalization process by raising the customs duties on some products. This book presents an extensive study on the effectiveness of recent regulations on pharmaceutical prices in India, exploring the weaknesses in the design and implementation of pharmaceutical price controls and investigating what can be done to fix the broken system.

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Author : Pradeep Mehta,Pradeep S. Author : Pradeep S. Mehta,Simon J. Agreement Sec 2 b Agreement includes any arrangement or understanding or action in concert: i. Whether or not, such arrangement, understanding or action is formal or in writing or, ii. Whether or not such arrangement, understanding or action is intended to be enforceable by legal proceedings. Who by agreement amongst themselves, limit, control or attempt to control the: i.

Production, distribution, sale, or, ii. Price of or trade in goods or provision of services. Buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, whether such purchase of goods is for resale or for any commercial purpose or for personal use; ii.

Hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than then person who hires or avails of the services for consideration paid or promised, or partly paid or partly promised or under any system of deferred payment, when such services are availed of with the approval of the first-mentioned person whether such hiring or availing of services is for any commercial purpose or for personal use.

Enterprise Sec 2 h Enterprise means a person or a department of the Government, who or which is, or has been, engaged in any activity, relating to the production, storage, supply, distribution, acquisition or control of articles or goods, or the provision of services, of any kind, or in investment, or in the business of acquiring, holding, underwriting or dealing with shares, debentures or other securities of any other body corporate, either directly or through one or more of its units or divisions or subsidiaries, whether such unit or division or subsidiary is located at the same place where the enterprise is located at a different place or different places.

But does not include any activity of the Government relatable to the sovereign functions of the Government including all activities carried on by the departments of the Central Government dealing with atomic energy, currency, defense and space. An individual, HUF, company body corporate, firm; ii. AOP whether incorporated or not, in India or outside India; iii. Any co-operative society; iv. A local authority; v. Every artificial juristic person.

Products manufactured, processed or mined; ii. Debentures, stock and shares after allotment; iii. In relation to goods supplied, distributed or controlled in India, goods imported into India. Control Sec 5 Explanation a Control includes Controlling the affairs or management by; i. Group Sec 5 Explanation b Group means two or more enterprise which directly or indirectly: i. Basic concepts of Competition Law: Predatory Pricing- It means the sale of goods or provision of services, at a price below the cost of production to reduce competition or eliminate the competitors.

The main objective of such a price is to reduce competition or to eliminate the competitors. Anti-Trust law- The antitrust laws apply to virtually all industries and to every level of business, including manufacturing, transportation, distribution, and marketing. They prohibit a variety of practices that restrain trade; [Examples are illegal practices of price- fixing, corporate mergers likely to reduce the competitive vigor of particular markets, and predatory acts designed to achieve or maintain monopoly power].

Monopoly - A market structure characterized by a single seller, selling a unique product in the market. In the classic theoretical definition of perfect competition, there is an infinite number of buyers and sellers. With many market players, it is impossible for any one participant to alter the prevailing price in the market. If they attempt to do so, buyers and sellers have infinite alternatives to pursue.

Oligopoly- An oligopoly is similar in many ways to a monopoly. The primary difference is that rather than having only one producer of a good or service, there are a handful of producers, or at least a handful of producers that make up a dominant majority of the production in the market system. While oligopolists do not have the same pricing power as monopolists, it is possible, without diligent government regulation that oligopolists will collude with one another to set prices in the same way a monopolist would.

Monopolistic competition — A type of market system combining elements of a monopoly and perfect competition. Like a perfectly competitive market system, there are numerous competitors in the market.

The difference is that each competitor is sufficiently differentiated from the others that some can charge greater prices than a perfectly competitive firm. While there are many artists, each artist is different and is not perfectly substitutable with another artist.

Bid Rigging- Agreement between enterprise or person engaged in similar production or trading of goods or provisions of service which has the effect of eliminating or reduce the competition for bid.

One of the main goals of the MRTP Act was to encourage fair play and fair deal in the market besides promoting healthy competition. They seek to afford protection and support consuming public by reducing Monopolistic, Restrictive and Unfair Trade Practices from the market. Globalization has the fundamental attributes of relying significantly on the market forces, ensuring competition and keeping market functioning efficiently.

The development of an industrial base with a view to achieving self-reliance; and 2. The promotion of social justice. The MRTP Act has become obsolete in certain areas in the light of international economic developments relating to competition laws and hence focus was shifted from curbing monopolies to promoting competition. In October , the Central Government appointed high-level committee under the chairmanship of Mr.

Raghavan popularly known as Raghavan Committee. The aim of the committee was to formulate the competition law in tune with economic reforms and international development. The committee presented its report on May The draft of the competition law was presented on November After certain amendments, the Parliament passed the new law, called Competition Act The Act came into force on January Subsequent developments in the Act 1.

The Act was amended as Competition Amendment Act, and became fully operational from 1 June The provisions relating to competition advocacy was notified on The provisions regulating anti-competitive agreements and abuse of dominance were notified with effect from 20 May The provisions regulating mergers and acquisitions were notified on June The Framework of Competition Act has essentially four compartments: 1. Anti- Competitive Agreements [ Section 3] 2.

Abuse of Dominance [ Section 4] 3. It is based upon Post- Liberalization. Focus Curbing Monopolies. Promoting Fair Competition. Registration of Agreements Compulsory registration of It does not provide for agreements relating to restrictive the registration of the trade practices.

Under the Competition Act, Dominance per se is not but only abuse of dominance is considered bad. Provisions for combination Does not contain provisions of Competition Act contains combination. Penalties No Penalties for offences. Penalties for offences. Principles Rule of law approach. Rule of reason approach. Exclusion A blanket exclusion of Exclusion of intellectual intellectual property rights. Act but now it is under the purview of Consumer Protection Act.

Abuse of dominance; 2. Cartels; 3. Bid-rigging; 4. Collusive agreements; 5. Price-fixing; 6. Predatory pricing etc. Establish a commission to prevent practices having an adverse effect on competition in the market. Promote and sustain competition in markets. Protect the interests of consumers. Ensure freedom of trade in the Indian markets. Duties of the Commission [Sec 18] a.

To eliminate Practices that have an adverse effect on competition. To protect the interests of consumers. To ensure freedom of trade carried on by other participants, in markets in India. Scope of the Act 1. Enquire into Anti-Competitive Agreements [Section - 3].

Enquire Abuse of Dominant Position [Section — 4]. Undertake Competition Advocacy [Section — 49]. Exclusion from the applicability of the Act 1. Those right protected as intellectual property rights. Agreement exclusively for exports. Anti-competitive agreements [Section 3] Any agreement for goods or services which has an appreciable adverse effect on competition in India is prohibited.

These kinds of agreements are known as anti-competitive agreements. An anti-competitive agreement entered into shall be void. Section 3 of the Act states that no enterprise shall enter into: 1.

Such agreements must cause or be likely to cause an appreciable adverse effect on competition AAEC in a relevant market in India. As per Sec 19 4 of the Competition Act, , while determining whether an agreement has an appreciable adverse effect on competition under section 3 vertical and horizontal agreements , have due regard to all or any of the following factors, namely:— a creation of barriers to new entrants in the market; b driving existing competitors out of the market; c foreclosure of competition by hindering entry into the market; d accrual of benefits to consumers; e improvements in production or distribution of goods or provision of services; or f promotion of technical, scientific and economic development by means of production or distribution of goods or provision of services.

There are two kinds of agreements 1. Vertical agreements. Horizontal agreements see Table 1 They are Agreements between parties in the same line of production. Example - agreement between manufactures, agreement between distributors. Agree to limit; or ii.

Control or attempt to control production, distribution, sale or price. Eg- Agreements to share information Sellers agree either to meet any price, the buyer is able to obtain from another supplier or release the buyer to purchase from another seller.

Eg- Agreement not to advertise agreements to limit business hours. It also give a relevant opportunity to the members because of its invaluable networking opportunities. It is also considered as an important platform to discuss the trends in the market place, any legislation or policy proposed by the government. So it is definite that business can reap well by joining relevant trade associations. Thereby, collusion of trade associations can tend to make agreements which is anti-competitive in nature.

Vertical Agreements see Table 1 Vertical agreement are those agreements between non-competition undertakings operating at different levels of manufacturing and distribution process. They are prohibited if such agreements cause or are likely to cause AAEC. Types of Vertical Agreements 1. Tie-in arrangement Any agreement between manufacturer and distributor not to sell manufactures product at or above a price floor at or below a price ceiling.

It requires a purchaser of goods to purchase some other goods as a condition of such purchase. Exclusive supply arrangement An agreement restricting the purchase in course of trade from acquiring the goods of trade from acquiring the goods of any other seller i.

For e. Exclusive distribution arrangement Any agreement to limit or restrict the output or supply of any goods to ant market or area e. Now if ABC manufacturer enters in to an agreement with the distributors to refuse the deals between XYZ manufacturers who uses the raw material of the ABC manufacturer to produce a particular product as produced by the ABC manufacturer then it can be considered as refusal to deal agreement.

Resale price maintenance Any agreement to sell goods on condition that the price to be charged on the resale by the purchaser shall be stipulated by the seller unless it is clearly stated that prices lower than those prices may be charged. Selling goods with the condition on resale at stipulated prices. Section 3 1 of the Act — Any agreement in respect of production, supply, distribution, storage, acquisition or control of goods or provision of services by enterprise or association of enterprises or person or association of persons which causes or is likely to cause an appreciable adverse effect on competition within India.

Section 4 1 of the Act — Abuse of dominant position. Inquiry [under section 19] Step -2 In the case of any agreement mentioned under section 3, comes before the CCI shall conduct an inquiry and adjudicate on whether the agreement has any adverse effect on competition based on the following facts: 1.

Whether there is a creation of any barrier to new entrants into the market. Whether the agreement drives out existing competitors in the markets. Whether there is any foreclosure of competition by hindering the entry into the market. Whether there is any accrual of benefits to the consumers. Whether the agreement can produce any improvement in production, distribution or supply of goods.

Whether the agreement promotes technical scientific or economic development. Orders by Commission after inquiry into agreements [Section 27] Step-3 If the commission finds that the agreement under section 3 is Anti-competitive, it can pass the following orders: 1.

Direct any enterprise or person to engage in such agreement to discontinue such agreement.