COMPETITION COMMISSION OF

INDIA
CCI
INTRODUCTION:
• The CCI is a statutory body corporate that was
established by the government on 14th October
2003. So it is an artificial person that has
perpetual succession. The Central Government
will appoint all its six members and the
Chairperson forming the Board.
• Now the main aim of the CCI is to implement the
modern competition laws and philosophy of the
Competition Act, 2002. It ensures that there are
no unfair practices in the market that have a
negative impact on healthy competition. This is
because healthy competition is good for the
consumers of a market.
• Monopolistic competition or other unfair
practices have an adverse effect on economic
growth.
The following are the objectives of the
Commission.
• To prevent practices having adverse effect on
competition.

• To promote and sustain competition in markets.

• To protect the interests of consumers and

• To ensure freedom of trade

• Consequent upon a challenge to certain
provisions of the Act and the observations of the
Hon'ble Supreme Court, the Act was amended by
the Competition (Amendment) Act, 2007. The
Monopolies and Restrictive Trade Practices Act,
1969 [MRTP Act] repealed and is replaced by the
Competition Act, 2002, with effect from 01st
September, 2009 [Notification Dated 28th
August, 2009].
• Over the years, CCI has finely played both
administrative and quasi-judicial roles to
eliminate practices having adverse effects on
competition, promote and sustain competition,
protect the interests of end consumers and
ensure freedom of trade in the markets of India.
So far, it has been quite a decent check on the
anticompetitive agreements and abuse of
dominant position of enterprises as envisaged
u/s 3 and 4 of the Act.
CHALLENGES FACED BY CCI

• During the course of gaining stability, CCI has faced

many challenges starting from the implementation of
competition law, transition in antitrust issues of the
current era, changing business practices to
examination of issues involving the digital economy
and e-commerce. It has now become a necessity for
CCI to move away from strategies used to examine a
conventional business and include parameters of data
accessibility, network effects and multi-sided markets
for getting better grip on new age areas like digital
economy and e-commerce industry.
Role
• Ensure that the markets work for the benefits of
the consumers, so the welfare of the consumers is
the main priority.
• Economic activities are promoting fair
competition in the market for growth and
prosperity.
• Implement the competition practices and policies
of the Competition Act. The aim is the best
possible utilization of resources by embracing
these policies.
• Another role of the CCI is to ensure interaction and
cooperation with the other regulating authorities in the
economy. This will ensure that the sectoral regulatory
laws are in agreeable with the competition laws.
• One important role of the CCI is to carry out advocacy
about competition and competition laws. It aims to
educate ministries, state governments, regulators, and
other authorities about the modern concepts of
competition. And it does so by conducting workshops,
seminars, publishing papers, etc.
Establishment of Commission
• Section 7:

• The Commission shall be a body corporate by

the name aforesaid having perpetual succession
and a common seal with power, subject to the
provisions of this Act, to acquire, hold and
dispose of property, both movable and
immovable, and to contract and shall, by the said
name, sue or be sued.
Section 8: Composition
• The Commission shall consist of a Chairperson and not less
than two and not more than six other Members to be
appointed by the Central Government.

• The Chairperson and every other Member shall be a person of

ability, integrity and standing and who has special knowledge
of, and such professional experience of not less than fifteen
years in, international trade, economics, business, commerce,
law, finance, accountancy,management, industry, public
affairs or competition matters, including competition law and
policy, which in the opinion of the Central Government, may
be useful to the Commission.
Section 9: Selection of Chairperson and
Members
• The Chairperson and other Members of the
Commission shall beappointed by the Central
Government from a panel of names recommended
by a Selection Committee consisting of –

• a) the Chief Justice of India or his nominee -

Chairperson

• b) the Secretary in the Ministry of Corporate Affairs

– Member
• c) the Secretary in the Ministry of Law and
Justice – Member
• d) two experts of repute who have special
knowledge of, and professional experience in
international trade, economics, business,
commerce, law, finance, accountancy,
management, industry, public affairs or
competition matters including competition law
and policy - Member
Section 10: Term of Office
• The Chairperson and every other Member shall
hold office as such for a term of five years from
the date on which he enters upon his office and
shall be eligible for re-appointment:

• Provided that the Chairperson or other Members

shall not hold office as such after he has attained
the age of sixty-five years
Section 11: Resignation and Suspension
• The Chairperson or any other Member may, by notice
in writing under his hand addressed to the Central
Government, resign his office:

• Provided that the Chairperson or a Member shall,

unless he is permitted by the Central Government to
relinquish his office sooner, continue to hold office
until the expiry of three months from the date of
receipt of such notice or until a person duly appointed
as his successor enters upon his office or until the
expiry of his term of office, whichever is the earliest.
• Not with standing anything contained in sub-section (1), the Central
Government may, by order, remove the Chairperson or any other Member
from his office if such Chairperson or Member, as the case may be,—

• (a) is, or at any time has been, adjudged as an insolvent; or

• (b) has engaged at any time, during his term of office, in anypaid
employment; or

• (c) has been convicted of an offence which, in the opinion of the Central
Government, involves moral turpitude; or

• (d) has acquired such financial or other interest as is likely toaffect

prejudicially his functions as a Member; or

• (e) has so abused his position as to render his continuance in office

prejudicial to the public interest; or

• (f) has become physically or mentally incapable of acting as a Member.

Section 16: Appointment of Director
General
• The Central Government may, by notification,
appoint a Director General for the purposes of
assisting the Commission in conducting inquiry
into contravention of any of the provisions of
this Act and for performing such other functions
as are, or may be, provided by or under this Act.
Section 18 : Duties of the Commission
• Subject to the provisions of this Act, it shall be the duty of
the Commission to eliminate practices having adverse
effect on competition, promote and sustain competition,
protect the interests of consumers and ensure freedom of
trade carried on by other participants, in markets in India:

• Provided that the Commission may, for the purpose of

discharging its duties or performing its functions under
this Act, enter into any memorandum or arrangement with
the prior approval of the Central Government, with any
agency of any foreign country.
Section 19 : Inquiry into agreements and
dominant position of enterprise
• (1) The Commission may inquire into any alleged
contravention of the provisions contained in subsection (1) of
section 3 or sub-section (1) of section 4 either on its own
motion or on—

• (a) [receipt of any information, in such manner and]

accompanied by such fee as may be determined by
regulations, from any person, consumer or their association
or trade association; or

• (b) a reference made to it by the Central Government or a

State Government or a statutory authority.
• (3) The Commission shall, while determining whether an agreement
has an appreciable adverse effect on competition under section 3,
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.
(19)(4) The Commission shall, while inquiring whether an
enterprise enjoys a dominant position or not under section
4, have due regard to all or any of the following factors,
namely:—
• (a) market share of the enterprise;

• (b) size and resources of the enterprise;

• (c) size and importance of the competitors;

• (d) economic power of the enterprise including commercial

advantages over competitors;

• (e) vertical integration of the enterprises or sale or service

network of such enterprises;
• (f) dependence of consumers on the enterprise;

• (g) monopoly or dominant position whether acquired as

a result of any statute or by virtue of being a Government
company or a public sector undertaking or otherwise;

• (h) entry barriers including barriers such as regulatory

barriers, financial risk, high capital cost of entry,
marketing entry barriers, technical entry barriers,
economies of scale, high cost of substitutable goods or
service for consumers;

• (i) countervailing buying power;

• (j) market structure and size of market;

• (k) social obligations and social costs;

• (I) relative advantage,by way of the contribution

to the economicdevelopment, by the enterprise
enjoying a dominant position having or likely to
have an appreciable adverse effect on competition;

• (m) any other factor which the Commission may

consider relevant for the inquiry.
• (5) For determining whether a market
constitutes a “relevant market” for thepurposes
of this Act, the Commission shall have due
regard to the “relevant geographic market’’ and
“relevant product market”.
• The Commission shall, while determining the
“relevant geographic market”, have due regard to
all or any of the following factors, namely:—

• (a) regulatory trade barriers;

• (b) local specification requirements;
• (c) national procurement policies;
• (d) adequate distribution facilities;
• (e) transport costs;
• (f) language;
• (g) consumer preferences;
• (h) need for secure or regular supplies or rapid
after-sales services.
• (19 ) (7) The Commission shall, while
determining the “relevant product market”, have
due regard to all or any of the following factors,
namely:—

• (a) physical characteristics or end-use of goods;

(b) price of goods or service
• (c) consumer preferences;
• (d) exclusion of in-house production;
• (e) existence of specialised producers;
• (f) classification of industrial products.
Section 27: Orders by Commission after inquiry
into agreements or abuse of dominant position

• Where after inquiry the Commission finds that

any agreement referred to in section 3 or action
of an enterprise in a dominant position, is in
contravention of section 3 or section 4, as the
case may be, it may pass all or any of the
following orders, namely
• (a) direct any enterprise or association of
enterprises or person or association of persons,
as the case may be, involved in such agreement,
or abuse of dominant position,

• to discontinue and not to re-enter such

agreement or

• discontinue such abuse of dominant position, as

the case may be;
• b) impose such penalty, as it may deem fit

• which shall be not more than ten percent of the average of

the turnover for the last three preceding financial years,
upon each of such person or enterprises which are parties
to such agreements or abuse:

• [Provided that in case any agreement referred to in section

3 has been entered into by a cartel, the Commission may
impose upon each producer, seller, distributor, trader or
service provider included in that cartel, a penalty of up to
three times of its profit for each year of the continuance of
such agreement or ten percent. of its turnover for each year
of the continuance of such agreement, whichever is higher.
• (d) direct that the agreements shall stand
modified to the extent and in the manner as may
be specified in the order by the Commission;

• (e) direct the enterprises concerned to abide by

such other orders as the Commission may pass
and comply with the directions, including
payment of costs, if any;
(g) pass such other [order or issue such directions]
as it may deem fit.

Order can be passed against a group also.

Section 28: Division of enterprise enjoying
dominant position.
• (1) The [Commission] may, notwithstanding
anything contained in any other law for the time
being in force, by order in writing, direct division
of an enterprise enjoying dominant position to
ensure that such enterprise does not abuse its
dominant position.
(2) In particular, and without prejudice to the generality
of the foregoing powers, the order referred to in sub-
section (1) may provide for all or any of the following
matters, namely:—

• (a) the transfer or vesting of property, rights,

liabilities or obligations;

• (b) the adjustment of contracts either by discharge

or reduction of any liability or obligation or
otherwise;

• (c) the creation, allotment, surrender or

cancellation of any shares, stocks or securities;
• (e) the formation or winding up of an enterprise
or the amendment of the memorandum of
association or articles of association or any other
instruments regulating the business of any
enterprise;

• (f) the extent to which, and the circumstances in

which, provisions of the order affecting an
enterprise may be altered by the enterprise and
the registration thereof;

• (g) any other matter which may be necessary to

give effect to the division of the enterprise.
Section 32 : Acts taking place outside India
but having an effect on competition in India

• The Commission shall, notwithstanding that,—

• (a) an agreement referred to in section 3 has been entered into
outside India; or
• (b) any party to such agreement is outside India; or
• (c) any enterprise abusing the dominant position is outside
India; or
• (d) a combination has taken place outside India; or
• (e) any party to combination is outside India; or
• (f) any other matter or practice or action arising out of such
agreement or dominant position or combination is outside India,
Section 41 : Duties of Director General
• To investigate the contraventions:

• (1) The Director General shall, when so directed by the

Commission, assist the Commission in investigating into any
contravention of the provisions of this Act or any rules or
regulations made there under.

• (2) The Director General shall have all the powers as are
conferred upon the Commission under subsection (2) of
section 36.

•
Penalties
• Section 42: Contravention of orders of Commission

• (1) The Commission may cause an inquiry to be made into

compliance of its orders or directions made in exercise of its
powers under the Act.

• (2) If any person, without reasonable clause, fails to comply with

the orders or directions of the Commission issued under sections
27, 28, 31, 32, 33, 42A and 43A of the Act, he shall be punishable
with fine which may extend to rupees one lakh for each day
during which such non-compliance occurs, subject to a maximum
of rupees ten crore, as the Commission may determine.
• (3) If any person does not comply with the orders or
directions issued, or fails to pay the fine imposed under sub-
section (2), he shall, without prejudice to any proceeding
under section 39, be punishable with imprisonment for a
term which may extend to three years, or with fine which may
extend to rupees twenty-five crore, or with both, as the Chief
Metropolitan Magistrate, Delhi may deem fit:

• Provided that the Chief Metropolitan Magistrate, Delhi shall

not take cognizance of any offence under this section save on
a complaint filed by the Commission or any of its officers
authorized by it.]
Section 42 A: Compensation in case of
contravention of orders of Commission
• Without prejudice to the provisions of this Act, any person
may make an application to the Appellate Tribunal for an
order for the recovery of compensation from any enterprise
for any loss or damage shown to have been suffered, by such
person as a result of the said enterprise violating sanctions
issued by the Commission or contravening, without any
reason-able ground, any decision or order of the Commission
issued under sections 27, 28, 31, 32 and 33 or any condition
or restriction subject to which any approval, sanction,
direction or exemption in relation to any matter has been
accorded, given, made or granted under this Act or delaying
in carrying out such orders or directions of the Commission.]
Section 43 A : Power to impose penalty for
non-furnishing of information on combinations

• If any person or enterprise who fails to give

notice to the Commission under sub- section(2)
of section 6, the Commission shall impose on
suchperson or enterprise a penalty which may
extend to one percent, of the total turnover or
the assets, whichever is higher, of such a
combination.
COMPETITION ADVOCACY
• Section 49:

• The Central Government may, in formulating a policy on

competition(including review of laws related to competition) or
any other matter, and a State Government may, in formulating a
policy on competition or on any other matter, as the case may
be, make a reference to the Commission for its opinion on
possible effect of such policy on competition and on the receipt
of such a reference, the Commission shall, within sixty days of
making such reference, give its opinion to the Central
Government, or the State Government, as the case may be,
which may thereafter take further action as it deems fit.
• The Commission shall take suitable measures for
the promotion of competition advocacy, creating
awareness and imparting training about
competition issues.