Competition Commission of India

The Competition Commission of India is established under the Competition Act, 2002. It is a statutory body that has the power to govern and enforce the Competition Act including penalties.  It was established when the need for a healthy competitive environment became necessary following liberalisation under the Vajpayee government. 

The Commission is composed of a chairman and a minimum of 2 board members and a maximum of 6 board members. These members are required to have a minimum of 15 years of experience in their respective fields. Its objectives, duties and powers are enumerated in the Competition Act, 2002. Its main duty and object is to ensure that the Indian markets maintain a healthy and fair competitive environment and is granted power to ensure such an environment and penalise any acts adversely affecting its duties.

Composition of Competition Commission of India (CCI):

The CCI comprises of a Chairperson and six Members, who are appointed by the Government of India. The Commission is manned by the following members

• Chairperson
• Member 1
• Member 2
• Member 3
• Member 4

The term of office of all the members of CCI is 5 years or till the attainment of age pf 65 years (whichever is early). The members are eligible for re-appointment.

The Chairperson and other members of CCI cannot hold any further employment for a period of two years from the date they cease to hold office in the Commission. But this restriction does not applies to any employment in the Union and State Government authority.

Objectives of Competition Commission of India CCI:

The Competition Commission of India (CCI) has been entrusted with the following task:

• To promote and then sustain an enabling competition culture through engagement and enforcement which would inspire businesses to be fair, competitive and innovative.
• To enhance the consumer welfare
• To support economic growth.
• The Competition Commission of India aims to establish a robust competitive environment through proactive engagement with all the stakeholders including the consumers, industry, government as well as international jurisdictions.

Functions of Competition Commission of India (CCI):

• It is the duty of the CCI to eliminate such practices that have adverse effect on competition.
• It is mandated to promote and sustain competition while protecting the interests of consumers.
• CCI ensures freedom of trade in the Indian market.
• The Commission also gives opinion on competition issues when asked by a statutory authority which is established under law.
• It is also required to undertake competition advocacy.
• The CCI also creates public awareness and imparts training on competition issues.
• Additionally, an appellate body called ‘Competition Appellate Tribunal‘ was also set up based on the Amendment Act of 2009, which allows for final appeal to Supreme Court of India.
• CCI is therefore, fully empowered to carry out the mandated functions.

Regulation of combination

The term combination has a broad definition under the ACT, it includes

• Any acquisition of shares,
• Voting rights,
• Control of assets
•  Party to merger or amalgamation of enterprises

Any person/enterprise shall not enter into a combination which is likely to have an adverse effect on the competition and such a combination will be void.

If any person/enterprise proposes to enter into a combination he shall intimate the Competition Commission of India within 30 days of:

• Approval of the proposal relating to mergers and amalgamation by the BOD of the enterprises involved in the process.
• Execution of any agreement pertaining to acquiring of control.

Business Perspective

Business Operations in India necessitates the knowledge of the various laws and regulations and also the implementation of the same. Competition in the market is a huge challenge which needs to be dealt with carefully. It is essential for the businesses to realize that although competition brings prosperity, thriving and striving shall be a continuous process. 

The various matters to be kept in mind by the business houses are:

1. The markets are susceptible to formation of cartels which pose a risk of formation of monopolies. The awareness of the fact that such associations are not permitted under the Competition Act 2002 is essential.
2. When discussions are made with competitors documentation of the same should be done.
3. Any meetings wherein any matter is being discussed, which shall raise issues under the competition law shall be avoided.
4. It is advisable to avoid discussions pertaining to price and the actual cost to the company.
5. Appointment of an Ombudsman for advise on the Competition Law so as to prevent any legal issues may be done.
6. Communication aspects although seem trivial may leave an impact when it comes to abuse of dominant position issues. Any statements made shall be weighed carefully.

The Competition Act 2002 is a comprehensive law and the intent of the legislation is 

To promote fair competition, catch up with the global economy, safeguard the interest of the consumers and ensure a stable market for India.