The Competition Act, 2002 was passed in India to safeguard the viability of market competition, take consumer interests into account, and foster the participation of market players in free commerce and trade. It encourages healthy entrepreneurial rivalry and frees the market from controlling more powerful trade companies. The act's primary goals aim to discourage or entirely halt acts that might harm competition, encourage and maintain competition in markets and safeguard consumers' interests while also overseeing trade freedom .
Some key provisions referred to in this act are:
Although the act aims to cover all such aspects to ensure a competitive market, there are certain areas which are left unaddressed by it. The parliament is undertaking amendments to the Competition Act of 2002 centred around the Competition Commission of India (CCI) and the need to promote accountability and agency. Fluctuations in the market following economic upheavals such as the Ukrainian crisis and the pandemic have rocked the market in the last two years and digitization in India is not slowing down. Modifications to the act were inevitable
The Competition Commission of India issued the Competition Commission of India (General) Amendment Regulations, 2022 via a notification on April 8th 2022. The amendment states that, upon written request, the Commission will safeguard the secrecy of an informant's identity . Some highlights include:
The Ministry of Corporate Affairs established the Competition Law Review Committee in 2018 to review the Competition Act of 2002. The Committee was tasked with examining whether the Act of 2002 was sufficient to address the altering market policies. With the advent of technological ad digitalisation, the economy has undergone major fluctuation as corporations evolve quicker than regulatory bodies can monitor their actions. The committee intended to propose procedural and structural amendments to the Act to address the state of the market. In 2019, the committee turned in its report, which resulted in a draft Competition Amendment Bill, 2020. The bill was then introduced to the public for comments .
After much deliberation, the Competition Amendment Bill 2022 was introduced and approved by the cabinet . A major change is that the governing structure of The Competition Commission of India will be altered by the proposed bill, and legal requirements will be changed to better suit the demands of modern markets. Changes involve broadening the definition of illegal anti-competitive agreements to include new-age marketing strategies that do not fit neatly into traditional supply chain arrangements for which the law contains clear regulatory restrictions.
Some more significant changes that the bill intends to bring are:
The law also acknowledges other types of cartels, such as hub-and-spoke cartels. It includes a catch-all clause that allows the CCI to deal with anti-competitive agreements regardless of how the parties are structured .
Data is sometimes referred to as ‘the oil of the 21st century’, and the collection of data is a driving force behind such regulation. Data about users, their habits, needs, and patterns has given corporations an unprecedented amount of power over the way the markets shift and churn. India's current legal framework is not yet sufficiently structured to address these shifting data usage trends. Predatory pricing, misuse of dominance, and discriminatory behaviour are just a few of the wrongdoings committed by IT corporations that frequently go unpunished.
Hence, the recent changes are quintessential to overseeing and regulating the disruption being caused by the advent of technology. The government must maintain a balance between a robust administrative structure and a system sympathetic to the market if it is to benefit as much as possible from the sizable market. The changes mentioned above are on similar lines, which is a good sign for the competition regime. However, it will be crucial to keep an eye on the possible implications of the introduced changes.