Competition (Amendment) Bill, 2020 - A crucial breakthrough!
Issue 27 | Feb 14, 2021
I am going to come right out and say it- the present law (the Competition Act, 2002) is straight-up outmoded and inefficient in dealing with new unscrupulous business models. And when India tries all of the tricks up its sleeve to bring in foreign capital, to get multinational businesses on board, and whatnot, what comes across as equally, if not more, important is to keep a check on the functioning and operations of the big sharks in the market.
However, the silver lining is, owing to a significant decision by the Supreme Court in Brahm Dutt V. Union of India, the Competition Law Review Committee (CLRC) realized that the CCI has been a one-man band, and it was time to grant it some relief and delegate the work, to cope with changing times.
Appreciating the law review committee’s insight and effort, the Ministry of Corporate Affairs (MCA) has prepared the draft Competition (Amendment) Bill, 2020. And mentioned below are some of the significant changes proposed in the Bill:
Structural changes proposed by the Committee-
The Bill proposes to integrate the office of the Director-General (DG) into the body of the Competition Commission of India and to make the DG answerable to the CCI, which has not been the case. It has further been proposed that the DG staff appointments now be undertaken by the CCI and not the Central Government, to speed up the process and fill in the vacancies.
Changes to promote the inclusion of technology & new-age markets-
The Bill further proposes to broaden the applicability of the 2002 Act and include within its ambit the new-age digital markets. And to facilitate the CCI in taking such a big leap, the Bill seeks to make numerous changes in the present system.
Empowering holders of intellectual property rights-
The Bill has sought to widen the protection towards IPR holders. Currently, their immunity is restricted to anti-competitive agreements. The proposal is to insert Section 4A in the 2002 Act to extend the immunity provided under the already existing Section 3(5). The idea behind this step is to cease the abuse of the dominant position, which the current provisions overlook.
The ones mentioned above are just some of the forever-desired changes, the Bill seeks to bring a ton of them. However, just as what we have all been hearing quite frequently- nothing is perfect, and everything has its flaws; the Bill drafted has a few shortcomings, too.
To name a few:
The Bill is completely silent on whether a settlement or commitment order has any precedential value.
The CCI’s initial review power (taken away from it by the 2007 amendment), although restored by the Supreme Court in Google Inc. V. CCI (wherein, it was held that the review power is uncompromisable and inherent), has not been recommended by the Bill.
In the end, I’d like to say, the Bill is a huge step forward and that it has the much-needed potential of nudging the Indian economy, as a whole, in the right direction.
The CLRC has done what was expected of them, and so has the MCA, by acknowledging the loopholes and drafting the befitting Bill.
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