CCI Proposed Draft (Lesser Penalty) Regulation, 2023
Background
CCI (Competition Commission of India) a statutory body regulates the trade practices in Indian market to promote and sustain competition in Indian market.
CCI is responsible to enforce The Competition Act, 2002.
CCI was established to make sure robust competitive environment through proactive with all stakeholders including Consumers, Industry, government and international jurisdictions.
CCI also reviews the merger and acquisitions.
Scope
Section 3 of Competition Act, 2002 prohibits the anti-competitive agreements, abuse of dominant position by enterprises, and regulates acquisitions, acquiring of control which may cause adverse effect on competition within India.
Draft CCI (Lesser Penalty) Regulations 2023) will repeal and replace the Competition Commission of India (Lesser Penalty) Regulations, 2009.
The draft Competition (Amendment) Act, 2023 (Amendment Act) introduced ‘lesser penalty plus*’ and withdrawal of ‘lesser penalty’/ ‘lesser penalty plus’ applications in the existing framework of Section 46 of the Act.
*Lesser penalty plus is a mechanism to award with the lesser penalty for the companies being investigating for cartel to reveal the information about other cartel which is unknow to regulators
Proposed Amendments
The Draft CCI (Lesser Penalty) Regulations 2023 provide for the following:
Form and contents of the application for lesser penalty and lesser penalty plus;
Procedure for grant of lesser penalty and lesser penalty plus; and
Withdrawal of application for lesser penalty and lesser penalty plus
Note: Nothing Contain in section 3 of the act shall restrict:the Copyright Act, 1957 (14 of 1957); the Patents Act, 1970 (39 of 1970); the Trade and Merchandise Marks Act, 1958 (43 of 1958) or the Trade Marks Act, 1999 (47 of 1999); the Geographical Indications of Goods (Registration and Protection) Act, 1999 (48 of 1999); the Designs Act, 2000 (16 of 2000); the Semi-conductor Integrated Circuits Layout-Design Act, 2000 (37 of 2000)Right of any person to export goods from India to the extent to which the agreement relates exclusively to the production, supply, distribution or control of goods or provision of services for such export
SW Point of View: The Carrot and Stick approach to break cartel of enterprises can be a game changer move. However, it may be possible that the companies may use it to make false allegation against their competitors which needs to be considered as well.
