By Dhanendra Kumar
Competition law is the life-force of the economy, spurring growth and efficiencies, levelling the playing field, releasing entrepreneurial energies, ensuring consumer welfare, and curbing deviations. As we bid good-bye to 2022, let us acknowledge it has indeed been a momentous year.
Since enforcement in 2009, the Competition Commission of India (CCI) has come a long way, recognised for its motto — ‘fair play for greater good’, becoming integral to businesses in India. It has since adjudicated more than 1,100 antitrust cases, approved over 900 combinations, and imposed penalty of Rs 20,000 crore for transgressions. Recently, on the recommendations of the GST Council, CCI has also been given powers to decide anti-profiteering cases under the GST Act from December 2022, replacing the National Anti-Profiteering Authority. The antitrust regulator has spread its presence, opened offices now in all four corners of the country—Delhi, Mumbai, Kolkata and Chennai.
This year has been full of action, wherein CCI has taken on Big Tech and several major corporates, apart from approving several high profile combinations. These included big names in digital markets, e-commerce, cement, tyre, real estate, pharma, entertainment, coal, etc.
CCI recently penalised Google in two different cases — Rs 936 crore for abuse of dominance for its Play Store policies, and Rs 1,337 crore for abuse of dominance in multiple markets in the Android ecosystem. The Commission ordered DG’s investigation against Apple, on information filed by an NGO for its alleged abuses. Karnataka High Court allowed CCI to continue its antitrust proceedings against Intel. Separately, Supreme Court dismissed the appeal of Amazon
Separately, CCI penalised OYO, MMT, GoIbibo for their alleged anti-trust violations. There other cases, one against Japanese maritime transport companies, another against paper manufacturers, some for bid rigging in Indian railway tenders. CCI ordered investigation against Zomato and Swiggy for one-sided clauses and exorbitant commissions.
On the Appellate side, NCLAT adjudicated several appeals against CCI orders, several upheld, some tweaked. Recently, the Tribunal did set aside an order against DLF Home Developers, sending the matter back for re-examination on alleged anti-competitive clauses in buyer-seller agreement. It also set aside the Rs 1,788-crore penalty imposed in the tyre cartel case and sent back the matter to the CCI for review due to errors in computation. NCLAT upheld a cartel case against certain LPG cylinder manufacturers, asking CCI to re-compute penalty after hearing parties.
This year saw several big-ticket mergers and acquisitions. The Adani Group’s acquisition of Ambuja Cements
The omission is constantly honing its antitrust and merger toolkits for easing procedures and meeting emerging challenges and, in doing so, benchmarking itself with global best practices. These included innovative Green Channel, an automatic approval for certain combinations with no horizontal or vertical overlap, doing away with the requirement of providing information on non-compete in merger filings, revising the guidance which give parties to the combination clarification on the information to be filed, and simplifying forms for filing notices. The commission has won global accolades for its reforms.
Evidenced-based compliance and advocacy with stakeholders is important for enforcement. CCI undertook several market studies, including a just released one on the film distribution chain in India, identifying competition concerns in value chain, and suggesting self-regulatory measures. In its study on the cab aggregator industry, the CCI brought out several areas of concern. Accordingly, it released an advisory to cab aggregators on description and calculation of fares, surge pricing, collection, use and data sharing and non-discriminatory allocation of rides.
One of the most important areas of reforms was a comprehensive review undertaken by the Competition Law Review Committee (CLRC), and based on its Report, a Competition Amendment Bill 2022 was presented on the table of the House. The Bill was referred to the Parliamentary Standing Committee on Finance (PSCF) which submitted its Report, now before Parliament. It includes recommendations on deal value thresholds, settlements and commitments, hub and spoke cartels, effects-based analysis, IPR exemptions, etc.
Separately, PSCF released its report on Anti-Competitive Practices by Big Tech, outlining competition concerns in the digital markets like tie-in arrangements, bundling, self-preferencing, advertising policies, deep discounting, data usage, etc, recommending several measures for ex-ante regulation, including introduction of a Digital Competition Act (DCA) for controlling Big Tech. However, there is debate on whether there is indeed need for the DCA when the CCI is already handling these cases deftly, and some major changes already on anvil after amendments in Competition Act are discussed and approved by the Parliament on the report of PSCF. The establishment in the CCI of a separate Digital Marketing Unit (DMU) manned by skilled experts is already on anvil. Whatever is finally decided by Parliament, it is certain that the competition law in India will see several major amendments in the coming year, making it future ready for the new age markets.
Competition law, which, in its preamble, aims at accelerated economic development of the country and consumer welfare, has been acclaimed as one of the most modern legislations to regulate the markets, achieving level playing field, entrepreneurial energies, and new technologies. As India strives to achieve 5 trillion dollar economy by 2025, competition law in India is getting fully poised to fulfil its role.
(The author is Former chairman, Competition Commission of India. With research inputs from Aditya Trivedi, research associate, COMPAD LLP. Views expressed are personal.)