1. An Overview of “Competition Act, 2002” By, Sharath Alva K
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29. Reasons which necessitated enactment of new law The key factor in the Competition Act is “appreciable adverse effect on competition” for which the factors, which need to consider, have also been prescribed. The M.R.T.P. Commission has to pass ‘cease & desist’ order on being convinced that the restrictive trade practice, which has been subject to enquiry, is “prejudicial to public interest”. The concept “prejudicial to public interest” is unclear, bald, vague and ambiguous. 1. The Competition Act, 2002 The M.R.T.P.Act, 1969
30. Under the Competition Act, the whole agreement is void in case it is found to have anti-competitive covenant having appreciable adverse effect on competition in the market . Under the M.R.T.P. Act only “restrictive clause” of the trade agreement can be declared void and not the whole agreement 3. In the regime of liberalization, the requirement to file registrable anti-competitive agreement with the office of the DG has been omitted. This is in line with the international trend. Under the M.R.T.P.Act, it is mandatory for a party to file a trade agreement within 60 days with the office of the DGI&R if such trade agreement contains restrictive clauses. 2.
31. The Competition Act focus only on “competition issues” and does not contain provisions, which directly relate to consumer protection. The M.R.T.P. Act contains provisions both relating to anti-competitive practices and consumer protection. 5. Under the Competition Act, the DG is vested with all the powers as are vested in a Civil Court. Under the M.R.T.P. Act, the powers of the DG have been found to be deficient and limited in carrying out investigation. 4.
32. No requirement of registration of agreements. Registration of agreements compulsory. 6. Frowns upon abuse of dominance. Frowns upon dominance. 5. Simple in arrangement and language and easily comprehensible. Complex in arrangement and language. 4. Competition offences explicit and defined. Competition offences implicit or not defined. 3. Based on structure as a factor. Based on size as a factor. 2. Based on the post-reforms scenario. Based on the pre-reforms scenario. 1 Other differences between M.R.T.P. Act & Competition Act:
33. Advocacy provision exist. No provision for advocacy. 15 Time is the essence. No time framework. 14 Unfair trade practices omitted consumer for a will deal with them. Unfair trade practices covered. 13 Proactive and flexible. Reactive and rigid. 12 Penalties for offences. No penalties for offences. 11 CCI has competition advocacy role. No competition advocacy role for the M.R.T.P.C. 10 Relatively more autonomy for the CCI. Very little administrative and financial autonomy for the MRTPC. 9 CCI selected by a Collegiums. MRTPC appointed by the Government. 8 Combinations regulated beyond a high threshold. No regulation on combination after 1991. 7
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