Competition enhances productivity in a particular industry and the generation of more

employment and lowers the price of goods and services for the consumers. It provides safeguards
and regulations which a welfare state like India requires. 1 Efficient competition is a basic need
for a market to work efficiently. The need for better laws was felt when India embraced the idea
of globalisation, privatisation and liberalisation. The MRTP Act, 1969 was amended in 1991 to
infuse a new lease of life in the legal regime. It was felt that the forces of competition need to be
reinforced with competition law.
With the emergence of globallization and privatization which leads to the increase in competitive
trade practises brings into picture the concepts of fair play and dealing thereby indirectly
bringing competition law into picture. Competition law comes into picture when the market
players start to conspire against the customers for the reason of more profit. Competition law
protects the innocent unaware buyers from being deceived by the sellers through their profit
making seller oriented practises. It ensures that the interest of an individual should not subvert
the community's interest.2
The positive growth rate changes helped India to reach a growth rate of 8% from 3% due to the
Economic Reforms 1991. Appreciable adverse effect on the competition practises in a relevant
market are removed or kept a checked on by the competition law.3
Competition Commission of India is the chief regulatory body that enforces the provisions of the
Competition act. CCI eliminates practices having adverse effect on the competition in the
market. Its main objective is to maintain the freedom of all the players in a relevant market 4 and

1The notion of welfare state is reflected from the text of preamble of the Constitution read with part IV i.e. directive
principles of state policy (DPSP) of the Constitution. See, The Supreme Court of India decision in the matter of
Minerva Mills Ltd. v. Union of India, (1980) 3 SCC 625; D.S. Nakara v. Union of India, (1983) 1 SCC 305 : 1983
SCR (2) 165.
2 Exception IPR related provision in Competition Act, 2002.
3 S. 2(r) of the Act defines ‘Relevant Market’. It reads as:— 2(r) “Relevant market” means the market which may
be determined by the Commission with reference to the relevant product market or the relevant geographic market
or with reference to both the markets;

4 Section 2 of the Competition Act, 2002:

(r) “relevant market” means the market which may be determined by the commission with reference to the relevant
product market or the relevant geographic market or with reference to both the markets;
(s) “relevant geographic market” means a market comprising the area in which the conditions of competition for
supply of goods or provision of services or demand of goods or services are distinctly homogenous and can be
distinguished from the conditions prevailing in the neighbouring areas;
(t) “relevant product market” means a market comprising all those products or services which are regarded as
interchangeable or substitutable by the consumer, by reason of characteristics of the products or services, their prices
and intended use;
to protect the interest of the customers and create awarness and impart training on major
competiton issues.
Under the MRTP Act 1969, it was clearly stated by the Supreme Court that CCI does not has any
extra territorial jurisdiction but now it has the power to look into provisions which were
prohibited earlier. It is allowed to inquire and investigate agreements and combination which
lead to abuse of dominance in the market and affect the free competitive market practices. Any
anti-competitive agreement that entered India from outside or any such agreement in which one
of the party is of outside India, there was no such provision to deal with such trade practices.5
The slogan for today's globalised economy for the success is the ‘bigger is better’ where the main
moto is to make the maximum profit through customer satisfaction. The main aim of consumer
welfare is to provide the global consumer the products irrespective of the country they are
beingexported from at a reasonable price to the person buying that particular product and to
maintain an internationally stable environment.6
In many cases big companies merge together and or come together in some form which gives
them more market power and brings into picture the abuse of dominance, it has clearly been
stated in a lot of judicial presidents that an enterprise having a dominance in the relevant market
is not bad but an enterprise abusing its dominance is considered bad. 7 However cross-border
mergers are different from the domestic mergers and are dealt and investigated upon in a
different way. If any entity violates Indian competition law outside India then CCI pursues
enforcement cross-border.
Competiton law is a “set of policies and laws which ensure that competition in the marketplace is
not restricted in a way that is detrimental to society.” 8 The policy basically refers to those
specific powers of a market which can affect the rights of the consumers in various ways like rise
in the price of the product, degrading the quality of the product, reduction in the manufacturing
and supply of the product and also depriving the consumers of their right to choose among
various products. Competition policy is defined as “those Government measures that directly

5 Haridas Exports v. All India Float Glass Manufacturers Association, (2002) 6 SCC 600 : (2002) 111 Company
Cases 617.
6 Joseph Wilson, “Globalization and the Limits of National Merger Control Laws” 10 Kluwer Law International,
International Competition law Series at 18.
7 B.S.Chauhan, “Indian Competition Law: Global Context”, 54 JILI (2012) 315.
8 Massimo Mota, Competition Policy: Theory and Practice 30 (Cambridge University Press, 2004). Also see, Vijay
Kumar Singh, “Competition Law and Policy in India: The Journey in a Decade” 4 NUJS Law Rev 523 (2011).
affect the behaviour of the enterprise and the structure of the industry”. It is impossible to draw
any sort of a set boundary.9 Some of the anti-competitive practices include:
1. Predatory pricing
2. Price fixing
3. Bid rigging
4. Dumping

The CCI has an overarching responsbility and role in various matters: “it shall be the duty of the
CCI 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.”10 Section 60 of the Competition Act, 2002 gives the legislation
superiority over all other statutes.
On the other hand intellectual property rights is an intangible form of property given to the actual
owner of the product or service. Intellectual property rights have become an integral part of our
daily lives. IPR has gained a lot of importance due to the increase in liberalisation and
globalisation and is very important for the industrial and economic development of the nation.
Intellectual property rights was hardly known to the CEOs initially but now is considered a very
important part of business strategy.11 It is an important source of generation of revenue for all
small, medium and large scale industries. Strategic and structural growth is required for creation
of intellectual wealth. They are a tool of business. Intellectual proprty rights can be clsssified
into following types:
1. Copyrights
2. Trademarks
3. Design
4. Patents
5. Geographical Indication

9 Draft National Competition Policy 2011 (India) available at:

http://www.mca.gov.in/Ministry_hn/pdf/Draft_National_Competition_Policy.pdf. Also see, Revised Draft National
Competition Policy 2011 (India) available.

10 S. 18 of the Competition Act 2002.

11 Jain, Karuna, Intellectual Property Management System: An Organisational Perspective, Journal of Intellectual
Property Right (2006), pp. 330-333.
Intellectual property rights are a potent weapon in the age of global competition. There is no
doubt in saying that intangible assets in this global competition play a very important role and
the smartphone industry is completely based on innovation if we look at the success stories of
leading companies like Dell, Coca-Cola, Pepsi, Microsoft, we can realize that intangible assets
and its right usage and protection can take us to great heights.12
The management of entire intellectual property rights require identifying, acquiring and
protecting property rights for wealth and value generation. It helps the enterprises in maintaining
a competitive edge over its competitors. IP management encompasses all IP rights including
patents, designs, trade marks, copyrights, semiconductor integrated circuits layout designs,
software programs, industrial designs, logos, confidential information, drawings, source codes,
technical information, and any other knowledge/know-how created by the employees and
affiliates of the organisation.13
Figure 1: Showing types of IPR

IP holders should be provided a right to operate in a certain domain. IP management can be used
proactively for innovation within certain terms and conditions.14
Intellectual Property Rights includes various forms of innovations like trademark, copyrights,
designs and patents. It is important for an organization to carefully consider the IP before moving

12 Vaishali Singh, Adding economic value to knowledge through strategic management of Intellectual property,
(2018) PL (IPR) January 93.
13 See William W. Fisher III & Felix Oberholzer-Gee, Strategic Management of Intellectual Property: An
Integrated Approach, California Management Review (2013) 55 CMR.BERKELEY.EDU, available at
<http://www.hbs.edu/faculty/Publication%20Files/CMR5504_10_Fisher_III_7bbf941f-fe1b-4069-a609-
9c6cd9a8783b.pdf>(last accessed on 21-11-2017).
14 Holgersson Marcus, Innovation and Intellectual Property: Strategic IP Management and Economics of
Technology, available at: <http://ssrn.com/abstract=2563297>(last accessed on 1-12-2017).
towards a fruitless or a costly journey. “Therefore following issues have to be addressed while
identifying an IP that a company owns are as follows:

(i) Selecting a company name, domain name and trademark.

(ii) Identifying your products or services.

(iii) Determining which of your products and services can be protected as IP.

(iv) Distinguishing what type of IP protection applies to each of your products and
services.”15

The next step is acquiring IPR followed by monitoring IPR. It includes managing wealth
generation and potential of value as well as the chain of title and company developed IP. Once
the IP rights are acquired the nextep is to enforce them and to monitor them otherwise there isn’t
any concept of a potential infringer.The last step is of commercialisation and the profits
completely depend on the choice of right commercial tools.Commercialisation basically means
bringing the IP into the market so that it can be used for the development and growth of the
business.16
Intellectual Property is the invention and evolution of every sphere of human accomplishment.
The development of intellectual property regime cannot be ignored by the businesses in the
current economic condition.It is also expected that the key players of a particular business need
to be well aware of the intellectual property tools in order to protect the innovation and creative
work of a business. Even the national IPR policy expects that a strategic perspective is important
for managing IPR policy. In order to achieve the overall strategic intent of IPR there is a need for
the implementation of a more effective IPR policy.

RELATION BETWEEN IPR AND COMPETITION LAW

Competition law and IPR are two completely different areas of laws, one focuses on limiting
monopoly and the other focuses on providing exclusivity. They both are like fire and water in
relation. In this paper, I would like to focus on the Indian laws that help to bring out a balance
between monopolies given to the key players in a relevant market due to IPR and competition

15 MaRS Entrepreneur Workbooks, Identifying your intellectual property, available at:

<https://www.marsdd.com/wp-content/uploads/2010/12/Identifying-Your-Intellectual-Property-
WorkbookGuide.pdf>(last accessed on 1-12-2017).
16 http://ship.mrc.ac.za/invention.htm
law which focuses on the welfare of the consumers. The relation between IPR and Competition
law is contradicting in nature. Both the laws advocate different goals, on one hand, competition
law focuses on free market and encourages perfectly competitive market which would help the
customers and improves bargaining power whereas IPR focuses on the rights of the key players
in a relevant market and provides them monopoly and exclusivity.
If you look at the recent approach we can understand the developments made to IPR and
competition law. On bare perusal it can be understood that IPR is quoted as a negative right
which gives the owner the exclusive right of exclusion from the universe at large 17. While on the
other hand the main motto of Competition law is the maximum possible production of resources
and also its allocation to the maximum possible level. If we look at the overall aspect then both
the laws aim at consumer welfare and producing efficiency in the market. Even though the anti-
trust laws and the IPR laws are very identical to each other, the main issue arrives when they
have reciprocal objectives in the long run.18 IPR creates benefits for further innovation.
Competition law aims to hold free, fair and effective access in the market whereas IPR gives
exclusive rights to the business owners for a specific period of time. 19 It can be said that
competition law looks after the consumer welfare or the consumer rights at large whereas IPR
specifically looks after the individual rights and this is the major conflict between the two
regimes.

Figure 2: Objectives of both IPR and Competition law

17 Bishwanath Prasad Radhey Shyam v. Hindustan Metal Industries, (1979) 2 SCC 511 : AIR 1982 SC 1444.
18 SCM Corpn. v. Xerox Corpn., 645 F 2d 1195, 1203 (2nd Cir 1981).
19 Richard Whish, Competition law 2 (2005).
Competition law aims at protecting the market whereas IPR gives exclusive rights to the IP
holders which prima facie goes against the exclusionary principle against the IP. Due to recent
developments in jurisprudence and market regulation has led to change in the thinking which are
the main reasons for the protection of IP. The reward theory witnesses change. The reason for
providing the exclusivity rights is just not making the work public but also providing incentive to
the owner for honoring and innovating his hard work. If we wish to have a reconciliation
between IP and competition law then it can be considered a packet of competition law rather than
studying it in exclusion to competition law. This, therefore, brought a balance between both the
laws thereby bringing a balance between the individual rights and the public interest. Such things
aim to promote more and more competition. It can be validated that protection given to IPR is
not in contravention to the promotion of a free and fair market.
It would be wrong to say that the objective of competition law is drafted to protect the interest of
those competitors whose aim is to compel a successful competition and distribute the wealth
among other competitors. The main aim of the competition law is to protect the competitive
process rather than protecting the competitors.20 There hasn't been any interference made by the
competition law into the provisions of IPR.

20 A. Kezsbom & A. Goldman, “No Shortcut to Anti-trust Analysis : The Twisted Journey of the Essential
Facilities Doctrine”, Columbia Business L. Rev. 1, 2 (1996).
Competition law has never interfered with the IPR law and in any situations where the creator is
being benefited for his or her invention. The role of IP is deeply acknowledged by the
competition law and also promotes free-riding directly or indirectly and encourages its support to
other individuals and firms who develop their own products or technologies which promotes the
growth of bonafide competition. Various examples can be cited regarding the same. It should be
noted that the application of entry power gives monopoly over market power.21 Monopolistic title
in a relevant market can only be given when there is no alternative to a particular product or
technology in that particular market in order to attain the same objective.
It does not mean the implication of economic monopoly when a legal monopoly is given
according to the provisions of IP law. It cannot be said that where there is presence of IP law
competition law automatically gets attracted. A mere grant of exclusive right does not mean
dominant position in the relevant market leading to abuse thereby attracting the provisions of
competition law. Situations where competition law interferes with IPR does not mean that it is
infringing the rights of the creators for their invention.
Competition law only questions the protection after IPR is granted to the inventor. There is no
hostility towards IPR by competition law though the interference on IPR in competition law is
not hostile. There have been many instances in the past where excessive IP rights being granted
to the IP holders under the IPR provision makes compulsory licensing justified so that there is no
misuse or abuse of the dominant position.22
There have also been many instances where IP laws fail in providing justice and competition law
works as a rescuer. “In cases wherein IP such as copyright, patent provide the IP holder with
market power, it may result in restriction of production process, supra-competitive prices, along
with excessive losses. In legitimate furtherance of IP right and self-interest, IP holders may sue
potential rivals and IP infringers, restricting entry to competition, or it may extend its market
power by precluding the access necessary for the next generation of products to emerge.”23 There
have been many instances where competition law interferes in the path of IPR in order to keep a
check that there hasn't been any sort of deviation from the path of fair play and dealings in the

21 Microsoft Corpn. v. Commission of the European Communities, T-201/04, 2007 ECR II-1491.
22 Abir Roy and Jayant Kumar, “A Comprehensive Guide to the Development of the Competition law in India”,
Eastern Law House, 2nd ed. 2014, p. 507.
23 Pham, Alice, “Competition Law and Intellectual Property Rights : Controlling Abuse or Abusing Control?”,
CUTS International, India, 2008.
competition market and there isn't any sort of abuse or misuse of power by the key players of the
relevant market.

MAJOR CONFLICTS
The anti-competitive practices include the usage of IPR as well as Competition law and talk
about the opposites between them which are:
1. Abuse of dominant position
Section 4 of the Indian Competition Act, 2002 mentions that no enterprise ought to abuse
its dominant position. In this aspect, India has had a large number of cases that go-ahead
to showcase that there sustains a conflict between IPR regard to competition law. These
problems were then distributed to be handled by the Competition Commission of India
(CCI) to solve the issue. This was mentioned in Aamir Khan Productions Pvt. Ltd. V.
Union of India24. CCI has further stated that intellectual property law does not has any
fixed overriding effect on competition law.

2. Refusal to License
This idea is based on the complementary belief of the intellectual property system and
competition law. The right holder can stop others from destroying the limited period of
rights delivered by law but cannot stop its growth. In the case of Entertainment Network
(India) Limited v. Super Cassette Industries Ltd,25 the relationship between IPR and
Competition law in this aspect was discussed. It was held that the owner of the copyright
exercises freedom of monopoly, but with unreasonable terms, it would amount to refusal.
This refusal to license was seen as anti-competitive.

3. Excessive Pricing
The topics of excessive pricing and predatory pricing are closely related to refusal to
license. Predatory pricing is signified by the Monopolies and Restrictive Trade Practices
Act, 1969 (MRTP Act) similar to restrictive trade practice. Overpricing of any patented
product or service is regarded as non-violative of any competition law provisions. After
linking to a few more cases, CCI has noticed that charging in another way for a similar

24 Aamir Khan Productions v. Union of India (2010) Bom 112.

25 [2008] 37 PTC 353 SC 78-91 [71].
 product under different nature of licenses is same in any market. It is important to bring
out a balance between the right IP protection and the competition-related policy in any
market as a acting field for any new industry.

4. Tying agreements
Section 3(4) of the Competition Act26 prohibits contracting agreements. This nature
includes a seller accepting to sell a highly in usage product or service only on the term
that the buyer also buys a less necessary product or service. In the end, the motive and
objective of patent and antitrust laws may not everytime go hand in hand, they are
complementary with similar goals motivating areas of creativity, industry, and
competition.27
It can be seen that many laws are sided towards IPR to encourage creation and save the rights of
IPR holders. The similar thing can be said for competition law as well. IPR laws are given a clear
edge and importance over the aims targeted to be achieved by competition law. The section
draws a boundary line between competition law and IPRs where any situation entails both
aspects. As stated above, the CCI has jurisdiction to figureout whether the presence of IPRs has a
restrictive or monopolistic power in the market and restricts any anti-competitive practices.

26 Section 3(4) in the Competition Act, 2002.

(4) Any agreement amongst enterprises or persons at different stages or levels of the production chain in different
markets, in respect of production, supply, distribution, storage, sale or price of, or trade in goods or provision of
services, including—
(a) tie-in arrangement;
(b) exclusive supply agreement;
(c) exclusive distribution agreement;
(d) refusal to deal;
(e) resale price maintenance, shall be an agreement in contravention of sub-section (1) if such agreement
causes or is likely to cause an appreciable adverse effect on competition in India. Explanation.—For the
purposes of this sub-section,—
(a) “tie-in arrangements” includes any agreement requiring a purchaser of goods, as a condition of such
purchase, to purchase some other goods;
(b) “exclusive supply agreement” includes any agreement restricting in any manner the purchaser in the course
of his trade from acquiring or otherwise dealing in any goods other than those of the seller or any other person;
(c) “exclusive distribution agreement” includes any agreement to limit, restrict or withhold the output or
supply of any goods or allocate any area or market for the disposal or sale of the goods;
(d) “refusal to deal” includes any agreement which restricts, or is likely to restrict, by any method the persons
or classes of persons to whom goods are sold or from whom goods are bought;
(e) “resale price maintenance” includes any agreement to sell goods on condition that the prices to be charged
on the resale by the purchaser shall be the prices stipulated by the seller unless it is clearly stated that prices
lower than those prices may be charged.
27 Abir Roy and Jayant Kumar, “A Comprehensive Guide to the Development of the Competition law in India”,
Eastern Law House, 2nd ed. 2014.
IPRs are understood to be a negative right as they are confined. The holder either prevents
infringement of his IPR or imposes conditions to save the same and s 3(5) (i) of the Competition
Act, 2002 merely makes this possible for any rights conferred by IPR statutes. The rights that can
be saved, however, are left to the limited statutes themselves by the usage of the words have
been or may be conferred upon him under. As held in the Automobile Spare parts case, the rights
should be conferred by the acts specified in the section and are therefore specific.
Infringement gives the IPR holder a benefit to use the negative rights that he/she embibes.
However, the competition act does not pinpoints what exactly amounts to infringement, and it is
protected to believe that infringement would lead to infringement under the IPR statutes.
Similarly, for imposing reasonable restrictions, the section does not make it clear regarding the
same. The use of words like maybe referred and imposition of reasonable conditions was
completely intended, and this legislative intention is sufficient to state that the Competition Act,
2002 did not willing exclude the usage of IPR statutes.

US LAWS

TRIPS
TRIPS can be identified as a ground norm in terms of International law. It has plays an important
role in harmonising and standardising intellectual property rights. It also provides provisions for
consumer welfare and larger markets for competition law.
In case of broader markets it provides provisions for taking apt measures for preventing any sort
of abuse of IPR by the IP holder that pose a threat to trade and have the power to adversely affect
the international transfers of secrets and technology.28 It can be clearly stated that there are some
competitions which restrict and adversely affect the transfer and trade of tech or secrets. 29
To prevent such violations and deviations the member states are advised to follow the regulations
and the policies carefully so that there is no deviation from the fair play and dealings in the

28 Article 8.2, TRIPS Agreement.

29 Article 40.1, TRIPS Agreement.
competition market and also check that all the measures undertaken are not inconsistent with
TRIPS agreement.30
The main aim of Article 6 of the TRIPS agreement is to provide another important aspect of the
competition law which is exhaustion of rights. Its main aim is to balance rights, objectives and
duties within the respective domain.31
In order to promote the interface of IPR and competition law, TRIPS provides IP rights to those
other than the actual IP holders in a domestic market for the use of certain technologies and
secrets.32 It also allows non-commercial government uses in national emergencies though such
authorization shall be subject to judicial review.33 Compulsory licensing is also allowed without
causing any sort of satisfaction of such conditions for the purpose of remedying practice through
administrative or judicial purposes to be anti-competitive in nature.34Article 40 of the TRIPS
agreement determines the anti-competitive practices or situations. It specifically gives the rights
to the states to specify collection property rights practices which lead to abuse in their particular
state legislature.35
“The essence of TRIPS Agreement in respect of IPR and competition interface can be
enumerated as the following three guiding principles:

a. It is the domain of each member State to formulate and reserve its own IPR related
competition structure and policy framework.

b. There has to be consonance in respect of the TRIPS Agreement, in respect of IP

safeguard, and the national IPR related competition policy.

c. The priority target shall be those practices which aim to restrict the dissemination of
protected technologies.”36

Figure 3: TRIPS regarding the interface between IPR and Competition law

30 Article 40.2, TRIPS Agreement.

31 A.K. Koul, “The General Agreement on Tariffs and Trade/World Trade Organisation : Law, Economics &
Policies”, 2005, p. 461.
32 Article 31, TRIPS Agreement.
33 Article 31(b), TRIPS Agreement.
34 Article 31(k), TRIPS Agreement.
35 Article 40(2), TRIPS Agreement.
36 Abir Roy and Jayant Kumar, “A Comprehensive Guide to the Development of the Competition law in India”,
Eastern Law House, 2nd ed. 2014, p. 183.
INDIAN PROVISIONS
Due to liberalisation and globalisation there has been an increase in the use of IP rights which
also at times lead to abuse of the rights provided under IPR. The judges have made laws in the
form of judicial precedents after analyzing and examining the interface between IPR and
competition law. On proper analysis and examination it can clearly be understood that each and
every provision of IPR need not be covered under competition law but the legislators while
drafting the legislation aimed to skip such practices which led to adverse effect on competition in
the relevant market, the approach was pro-competitive.37

37 Statement of Object and Reasons, Competition Act, 2002 [Act 12 of 2003].

According to Directive Principles of State Policy (DPSP), the Constitution of India gives rise to
aims and objectives which provide, promote and secure justice which is economical, social and
political for the Indian public and maintenance of the social order.38 It aims that such principles
shall be fundamental and it gives this duty to the State to ensure the same.39
Competition reflects the soul of the Indian constitution whose main objective is to provide
restrictive anti-competitive market structure and fair chance. The Competition Act, 2002 restricts
monopolies and anti-competitive practices. “The main aim is to develop the market structure
namely by:

a. The agreements/arrangements that are anti-competitive in nature;

b. The abuse of dominant position in the relevant market, and arbitrary actions by market
players;

c. Regulations of combinations which exceed the maximum limits in respect of the

prescribed assets or turnovers.”40

The most important section that showcases the coherence between IPR and Competition law is
section 3(5) of the Indian Competition Act, 2002 41. It states the ‘reasonable restrictions’ as
necessary and are reasonable and logical for the protection of IPR during the exercise would not
constitute anti-competitive agreements. Though the law has nowhere mentioned reasonable
conditions which aim at providing exceptions under Section 3 of the Competition Act, 2002.
Therefore, it implies that ‘unreasonable conditions’ that are attached to an IPR will on its own
attract Section 3 of the Competition Act, 2002 42. In the further text the term ‘reasonable’ has

38 Articles 38, 39, Constitution of India.

39 Article 37, Constitution of India.
40 D.P. Mittal, “Competition Law and Practise”, Taxman Publications, 2008, p. 3.
41 Section 3(5) in the Competition Act, 2002
(5) Nothing contained in this section shall restrict—
(i) the right of any person to restrain any infringement of, or to impose reasonable conditions, as may be
necessary for protecting any of his rights which have been or may be conferred upon him under:
(a) the Copyright Act, 1957 (14 of 1957);
(b) the Patents Act, 1970 (39 of 1970);
(c) the Trade and Merchandise Marks Act, 1958 (43 of 1958) or the Trade Marks Act, 1999 (47 of 1999);
(d) the Geographical Indications of Goods (Registration and Protection) Act, 1999 (48 of 1999);
(e) the Designs Act, 2000 (16 of 2000);
(f) the Semi-conductor Integrated Circuits Layout-Design Act, 2000 (37 of 2000);
(ii) the 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.
42 Aamir Khan Productions (P) Ltd. v. Union of India, 2010 SCC OnLine Bom 1226 : (2010) 112 Bom LR 3378 :
(2010) 4 Comp LJ 580.
been examined. Section 3 of the Competition Act, 2002 regulates the practice efficiently in order
to check arbitrary IPR and unreasonable practices. Through the use of abuse of dominant
position, Competition Act provides anti-competitive activity with respect to IPR 43.

If with the European Union a parallel is drawn, Section 4 of the Competition Act, 2002 gets its
origin from Section 82 of the EC Treaty. It is very well known that presence of dominant
position in the relevant market is not bad but the abuse of that position within that particular
relevant market brings competition law into picture. It can clearly be stated that no exception has

43 Section 4 in the Competition Act, 2002

4. Abuse of dominant position.—

(1) No enterprise shall abuse its dominant position.

(2) There shall be an abuse of dominant position under sub-section (1), if an enterprise,—

(a) directly or indirectly, imposes unfair or discriminatory—

(i) condition in purchase or sale of goods or services; or

(ii) price in purchase or sale (including predatory price) of goods or service; or Explanation.—For the
purposes of this clause, the unfair or discriminatory condition in purchase or sale of goods or services
referred to in sub-clause (i) and unfair or discriminatory price in purchase or sale of goods (including
predatory price) or service referred to in sub-clause (ii) shall not include such discriminatory conditions
or prices which may be adopted to meet the competition; or

(b) limits or restricts—

(i) production of goods or provision of services or market therefor; or

(ii) technical or scientific development relating to goods or services to the prejudice of consumers; or

(c) indulges in practice or practices resulting in denial of market access; or

(d) makes conclusion of contracts subject to acceptance by other parties of supplementary obligations which,
by their nature or according to commercial usage, have no connection with the subject of such contracts; or

(e) uses its dominant position in one relevant market to enter into, or protect, other relevant market.
Explanation .—For the purposes of this section, the expression—

(a) “dominant position” means a position of strength, enjoyed by an enterprise, in the relevant market, in India,
which enables it to—

(i) operate independently of competitive forces prevailing in the relevant market; or

(ii) affect its competitors or consumers or the relevant market in its favour;
been created for IPR. The main motive behind such a practice is to ensure that the main motto of
IPR is not deviated upon. It is always kept in mind that the reasonable conditions do not lead to
frustration of the exclusive rights given under IPR, while protecting the rights of IP holders to a
reasonable extent.

The abuse of dominant position in itself is not covered under section 4 of the Competition Act,
2002 but its abuse which stops the competition in the market.

“Analyzing the term reasonable conditions, licensing arrangements which are likely to affect
adversely the prices, quantities, quality or varieties of goods and services will lawfully fall under
the ambit of competition law until they are not in reasonable juxtaposition with the bundle of
rights that follow IPRs. Exclusive licensing, involving cross-licensing by parties collectively
possessing market power, can be referred to as another such unreasonable condition. Some
others can be illustrated as:

a. Patent pooling is expressly a restrictive practice. This will not constitute the bundle of
rights forming part of an IPR.

b. Tie-in arrangements, wherein a licensee may be required to acquire particular goods

(unpatented materials) exclusively from the patentee, thereby foreclosing all the
legitimate business opportunities of other market players44.

c. Fixing of prices by the licensor at which the licensee is bound to sell.

d. Condition which restricts the licensee territorially or to a class of customers.” 45

RECOMMENDATION AND CONCLUSION

(b) “predatory price” means the sale of goods or provision of services, at a price which is below the cost, as
may be determined by regulations, of production of the goods or provision of services, with a view to reduce
competition or eliminate the competitors.

44 Ajay Devgun Films v. Yash Raj Films (P) Ltd., 2012 SCC OnLine Comp AT 233.
45 FICCI-Multiplex Assn. of India v. United Producers/Distributors Forum, 2011 SCC OnLine CCI 33.
IPR cannot be interfere with in isolation from Competition Law. The situations implied by
competition law may assist to solve the issue. The below mentioned are a few suggestions to
assist in resolving the conflict:
1. Understanding the market clearly by understanding the implications and regimes.
2. Confirming the coordination between the competition law authorities (CCI) and IPR
authorities.
3. Granting compulsory licenses in cases of refusal to deal.
4. Using the flexibilities allowed by the TRIPS agreement to understand the grounds of
granting compulsory licenses to resolve anti-competitive practices referring to IPRs.

It can be summed up that though it has been witnessed that there have been a large number of
conflicts that more than the similarities between IPR and Competition law, there are remaining
acts and legislations that aid in building up the gap between the two. S 3(5) (i) of the
Competition Act, 2002 is specific enough to handle the issue because the usage of the words like
maybe conferred and imposition of reasonable restrictions was completely intentional, and this
legislative intention is sufficient to state that the Competition act did not willingly exclude the
usage of IPR statutes.
It can be indubitably be concluded that there is no overlapping or conflict between the aims and
objectives both the laws in hand. Both the laws are encouraging creation and consumer welbeing.
Domains of both laws has been harmoniously constructed to come to a middle path. a proper
analysis leads to a conclusion that the interface between both the laws cannot be attained in
isolation. Even if they both are parallel to one another but their aims are converging with each
other. Even though there is such debatable issue they reconciled in such a way that both laws are
prevelant which in outcome encourages invention and consumer welbeing.
From the exhaustive research being put down, it can be very properly be understood that rather
than reading up both the laws in isolation, middle path is being made up through usage of statues
and understanding of statues through judgments and decrees passed by the Courts so that benefits
to the IP holder are gained without any compromise on consumer wellbeing. Some guiding
principles can be extracted from the exhaustive research put down concerning the understanding
of IPR and competition law. Firstly, complete regulation shall not apply to IPR. It shall be
understood with only in cases wherein it causes a drastic effect on the market competition.
Secondly, enterprises getting involved with IPR shall be seriously regulated to skip any
specification of market strength concluding in abuse of market dominance. Thirdly, the
Competition Commission of India must be given enough jurisdiction to understand cases
wherein competition is affected involving IPR issues. Fourthly, the jurisdiction of CCI shall be
included in cases that involve excessive pricing and also refusal to deal on useless and not so
important grounds. Fifthly, developing countries, while drafting their legal framework in the
understanding of IPR and competition, should properly analyze the jurisprudence in the U.S. and
European Union as they are the only important jurisdictions that have referred to the issue in
detail. The inference from the above reasoning brings forth an idea that the interface of the IP
and competition law would not be a rightful comprehension if it is understood to the latter, the
direct aim of enhancing creation, or in the case of the former, the direct aim of supporting the
competition. It must be understood that though both the objectives target different objectives,
they are synergies; each in them in full capacity serves the other by fulfilling its duty. The main
task in supporting a consonance between the two and fair market regulation is to channel and
enforce laws both within the IP law as well as apart from the IP laws, i.e. detailed competition
law in such a manner that it in result encourages wide competitive markets.
As discussed before, the pro-competitive approach of IPR law encourages competition. Pro-
competitive interpretation of IPR law should be given an edge, rather than competing over the
integrity of such rights. Interpretation should not be made the grounds for widening IPRs, only
legislation. IPR for careful and cogent understanding should be understood in a way that is in
parallel with the competitive dynamism. IP deals with the allowance and functioning of
exclusive rights given to the creators, and competition law aims to deal with the way and limit of
exercise of such rights. Competition law should keep itself aimed only at the effect of the
relevant market in the exercise of IP rights. General policymaking should be kept away from
individual cases. Such differentiation is very important for fulfilling the aim of respective laws.
In the end, while understanding the interface between both the laws, the difference between legal
and economic monopoly should always be kept in mind. While legal monopoly goes in the range
of IPR related legal regime, the latter goes under the jurisdiction of competition law.
As the time is gradually passing by, ADR mechanisms are attaining recognition and importance,
arbitration is considered a preferable option for the companies and organizations to solve
business issues. With this considerable development, the doubt of arbitrability tends to fade
away. Though, the grey area over the doubts of rights in rem and public policy make it difficult
for the arbitral tribunals to act upon their jurisdiction. The authors consider that and as stated
before, there is a demand to consolidate the prevailing legal area of Arbitration in India, rather
than putting things out of its jurisdiction, because of its considered as ‘private’ modus operandi.

IPRs intensive technology transfer concerning anti-competitive practices have been, and further
to be, acted upon in international courts. After the failure of the negotiations of draft code of
conduct on transfer of technology, the anti-competitive laws in the TRIPS are the top relevant
leap for evolving country members of WTO. These regulations establish a legal framework for
WTO members with a detailed choice to customize their domestic competition law to handle the
anti-competitive practises in technology transfer contracts. Also, successful technology transfer
relies on the smart use of TRIPS by developing nations. A developing nation member would
prefer per se prohibition role in its competition laws rather than choosing a rule of reasonable
approach keeping in opinion the standard of growth and the economic as well as institutional
culture. In any case, in the world of large intellectual property safety, IPR-related competition
law should be ‘glocalised’. Growing nations should choose and customize their nations
anticompetitive laws to make it appropriate to the domestic context and demands. Preferable
IPR-related competition law and rules towards technology transfer is the demand of the hour for
the growing nations choosing to foster technology transfer and consumer welbeing.

The usage of Competition laws towards exclusive right holders would be used carefully in order
to skip large precedent and apt competition in the field. Indian Courts are at an initial stage
towards solving disputes regarding IPR and Competition law. The Courts lack suitable judicial
precedents and apt judicial verbatum in order solve issues in such areas. In light of the normal
situation in India, it is held that it should adpot to the TRIPS Agreement in order to create an
edifice to solve issues related to both the regimes.

Further, the Agreement is not precise to form a strict set of tools to give a proper training
towards each case of anti-competitive practice related to IPR. However, it should present to the
Courts in the form a draft of balancing IPR and Competition laws in the backdrop of attaining
public and economic profit.

In order to create an opposite balance among both such regimes, it mentioned that Indian Courts
should put in the precedent settled down in EU. Further, the judicial standings should give a
proper applicability of Competition laws pertaining to IP holders. The judicial content should
opine that the interface of Competition laws with regards to IP holder's rights are with regards to
the usage of such rights and not its presence. Lastly, the Courts should give a clear difference
between the two areas and give decisions in the framework of attaining consumer welbeing,
promotion of invention and economic achievement.

After understanding the legislations and cases, it is settled that the Competition law of India is
not properly drafted to interact with the cases including Intellectual Property and Competition
Law. The Competition Act in India has not completely enhanced and grown with regards to the
interplay between Intellectual Property and Competition Law. The competition authorities are
highly dependent on the European Union judgments since it is understood to be the most updated
competition regimes all over the world. The Amir Khan Productions Pvt. Ltd. case, the FICCI
case, the Microsoft case, the Micromax case and the latest Ericsson cases are the onset in the
Indian jurisprudence of interjection between Intellectual Property Law and Competition Law. In
the recent economy, IPR and Competition are acting harmonizing roles in the ultimate goal of
safety of consumer welbeing. On one hand, IPR encourages invention which in favour fast-tracks
competition in the market. The fact that these two areas of law come against each other but it is
also imperative that understanding between the two is needed too.

There exists a difference between ‘legal monopoly’ and ‘economic monopoly’ since the former
is within the domain of IPR authorities and the other one within the domain of competition
authorities. It is the responsibility of competition authorities to check out that dominant position
ipso facto does not give monopoly but the abuse of such dominant position which shall attract
the offences within the competition law. The understanding of the scope of competition law and
IP laws showcases certain factors that can be used for understanding unreasonable use of IPRs. It
is suggested that the basic determinants of abuse of IPRs could be extreme pricing and
accessibility of goods and services. The secondary determinants of abuse of IPRs could be
market sharing, unfair contract terms and dominance leverage. There are a few IP management
practices which have many pro-competitive effects than anti-competitive effects. Nonetheless,
such practices may also come within the realm of competition law. These are patent pools, cross-
licensing, field of use licences and the standard setting process.
In India, it is the responsibility of the Competition Commission to remove practices having
extreme effect on competition, encourage and sustain competition, save the interests of
consumers and preserve the freedom of trade carried on by other participants, in markets in
India. The obligation to give compulsory license and to adjudge the status of an innovation vis-à-
vis section 3(d) of the Indian Patent Act, 1970 has been given to the Controller of Patents,
Design and Trademarks. The Controller, under the Indian Patent Act 1970, is the creates the
statute. As every enquiry brings up a new problem to the ahead, a possible conundrum which
further needs to be addressed is the enquiry into the jurisdiction of the proper forum in India for
solution of the abuse of patent rights in an anti-competitive way46

The update announced National IPR Policy by the Department of Industrial Promotion and
Policy, Government of India47 has referred that it is the demand of the hour to defend India's
interest to support a robust basis in the world of competition. The policy seeks to support the
existing laws and give an effective legal system for the safety, enhancement and intervention
between IPRs and Competition laws. The winds of change shall bring a new set of problems in
reference to conflicts in overlapping zones of IPR and competition law and it is valid for
developing nations like India who are at the end of cutting edge technology to save their
invention and also be with the updated economic techniques in the garb of saving the
competition.

46 Tapas Kumar Bandhopadhyay & Saurav Bindal, Managing competition : scrutinizing the Indian Patent Act
1970, 33 E.C.L.R. 33(2), 100-104 (2012).
47 Ministry of Commerce and Industry, National Intellectual Property Rights Policy, (May 12, 2016)
<http://dipp.nic.in/English/Schemes/intellectual_property_rights.aspx> accessed 27 September 2016.