Some Points are already Mentioned in Printed Notes( History and Development of Competetion law

& Salient Features of MRTP Act, 1969.)

Development of Competition Law in USA, UK, EU.

USA
 Rapid industrialisation resulted in the accumulation of wealth in the hands of many
corporations and individuals. It also resulted in fast developments in corporate organisation,
which in effect provided much more opportunities for combinations among competitors to
avoid competition in the market.iCombinations under the disguise of ‘trusts’ multiplied
swiftly in different important sectors like oil, steel and finance with the aim of curtailing
competition. Their increasing economic power created widespread fears about the
oppression of individuals and general injury to the public. The Sherman Act was enacted with
the aim of breaking up such trusts and restoring competition in the market.
 Though many state level laws already existed in this area, they were limited to intra-state
commerce and the Sherman Act was the first federal legislation to address the issue. The
Sherman Act was legislated under the power vested on the Congress by the U.S. Constitution
to regulate interstate commerce.
Sherman Act of 1890.
 It is considered America's oldest law and played a significant role in the evolution of
competition law in the US. The framers of the Sherman act find its roots in the American
common law system and made it to maintain competition in the market. The Sherman act of
1890 was mainly made to limit the competition in US markets. Sherman act of 1890 prohibits
enterprises to form agreements with one another which will create negative competition or
limit competition in the market.
 The main aim of this act is to break up all such trusts which create negative competition and
resort to healthy competition in the market. In the Sherman act of 1890, section 1 deals with
and prohibits all those agreements which restrain trade or cause hindrance to it.

Whereas section 2 of the act deals with monopoly. They were some loopholes which could
not mitigate the problems, so in 1914 the US Congress enacted the Clayton act and the
Federal Trade Commission act. One of the loopholes is that instead of forming trusts,
corporations started forming mergers and regulated prices and production through it. Prices
went up due to mergers and created a different form of monopoly which adversely affected
customers.
 In 1914, the US Congress enacted the Clayton Act and the Federal Trade Commission Act to
overcome some of the shortcomings in the Sherman Act and to bring more clarity on the
specific business actions covered by the anti-trust laws.
 The Clayton Act specifically addressed issues like price discrimination, tying and exclusive
dealing contracts.vThe Clayton Act also regulated mergers and acquisitions that may affect
competition or tend to create monopolies in any segment.vi The Clayton Act provided private
right of action and allowed recovery of threefold the damages she or he has sustained, along
with costs and attorney’s fee.
 On the other hand, the Federal Trade Commission Act of 1914 is remarkable for introducing
a consumer protection aspect to the competition laws. The Federal Trade Commission Act
established the Federal Trade Commission, which aims at protecting consumers from unfair,
 deceptive or fraudulent practices. The Federal Trade Commission is envisaged as a bipartisan
federal agency and it is headed by five commissioners who are nominated by the President.
The Federal Trade Commission can order investigations against corporations or persons who
are suspected to be engaging in unfair, deceptive or fraudulent trade practices which are
against the provisions of the FTC Act.
 The Clayton Act was amended in the years 1936 and 1950. The 1936 Amendment through
Robinson Patman Act prohibited certain forms of price discrimination. The historical context
of this legislation shows that it was primarily aimed to protect small-scale retailers, who were
facing considerable threat to their existence from large-scale chain stores, who were
receiving highly discounted prices for goods due to their bigger procurements. The Robinson
Patman Act made it unlawful to discriminate in prices between different purchasers of
commodities of like grade and quality, where such commodities are sold for use,
consumption, or resale and where it may substantially lessen competition or tend to create a
monopoly or injure, destroy or prevent competition. ix However, the legislation also clarifies
that the price differences that arise from differences in manufacturing costs or other costs,
do not come within the ambit of the prohibition.x For a successful claim under the Robinson
Patman Act, it is very important to prove that the products on which the alleged price
discrimination happened are of like grade and quality.
 Whereas the CellerKefauver act (1950) was introduced to address some loopholes in anti-
merger provisions about asset acquisitions. Then came the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 which played an important role in the evolution of US anti-trust
law.
 This act discusses the mandatory filing before the federal commission for any sort of merger
and acquisition which also includes the transfer of securities or assets to make ensure that
any transaction will not violate the anti-trust laws and affect the US market adversely. It must
be kept in mind that judicial interpretation of anti-trust laws also played a significant role in
transforming the anti-trust laws in the US. Cases such as the Morton Salt case, Standard Oil
company case and Kodak case are considered important cases in understanding the
competition law in the US along with its evolution.

Application of Competition Law in the USA

1. Introduction to U.S. Competition Law
Competition law in the United States, commonly known as antitrust law, is designed to
promote fair competition and prevent monopolistic behavior and unfair business practices.
The U.S. was the pioneer in enacting comprehensive competition legislation, with laws that
date back to the late 19th century.
The key objectives of U.S. antitrust law are:
 Preventing anti-competitive agreements and practices
 Prohibiting abusive behavior by dominant firms
 Regulating mergers and acquisitions to prevent market concentration
 Protecting consumer welfare and market integrity

2. Major Antitrust Statutes

a) Sherman Antitrust Act (1890)
 Section 1 prohibits contracts, combinations, or conspiracies that unreasonably restrain trade.
 Section 2 makes it illegal to monopolize or attempt to monopolize any part of trade or
commerce.
 b) Clayton Antitrust Act (1914)
 Targets specific practices that the Sherman Act does not explicitly prohibit, such as:
o Price discrimination
o Exclusive dealing agreements
o Tying arrangements
o Mergers and acquisitions that may substantially lessen competition
c) Federal Trade Commission Act (1914)
 Established the Federal Trade Commission (FTC)
 Section 5 prohibits “unfair methods of competition” and “unfair or deceptive acts or
practices.”
d) Hart-Scott-Rodino Antitrust Improvements Act (1976)
 Requires companies to file pre-merger notifications for review by the FTC and DOJ for certain
mergers or acquisitions.

3. Key Enforcement Agencies

a) Department of Justice (DOJ) – Antitrust Division
 Has criminal enforcement powers.
 Can prosecute cartels and bid-rigging cases.
b) Federal Trade Commission (FTC)
 Has civil enforcement powers.
 Can conduct investigations, enforce rules, and issue cease-and-desist orders.
Both agencies have the authority to review mergers and challenge anti-competitive conduct.

4. Areas of Application
a) Cartel and Collusion Control
 Cartels, price-fixing, market allocation, and bid-rigging are per se illegal.
 DOJ criminally prosecutes such conduct.
 High-profile cases include prosecutions in industries like auto parts, financial services, and
tech.
b) Monopolization and Abuse of Dominance
 Monopolies are not illegal, but abuse of market power is.
 Example: United States v. Microsoft Corp. (2001) – Microsoft was found to have abused its
monopoly power in the PC operating systems market.
c) Merger Control
 Mergers that may substantially lessen competition or create a monopoly can be blocked or
modified.
 Example: In FTC v. Meta Platforms, Inc., the FTC challenged Meta’s acquisitions in the VR
space.
d) Vertical and Horizontal Agreements
 Horizontal agreements between competitors (e.g., fixing prices) are per se illegal.
 Vertical agreements (e.g., resale price maintenance) are judged under the "rule of reason"
test.
e) Digital Markets and Big Tech
 Increasing scrutiny of companies like Google, Apple, Amazon, and Meta.
 Ongoing investigations and lawsuits focus on data dominance, gatekeeping behavior, and
exclusionary tactics.

5. Legal Standards and Enforcement Methods

 Per Se Rule vs. Rule of Reason
 Per Se Rule: Automatically deems some practices illegal (e.g., price-fixing).
 Rule of Reason: Considers the context, purpose, and market impact of the conduct.
Civil vs. Criminal Enforcement
 DOJ can pursue criminal sanctions (fines, imprisonment).
 FTC and DOJ can pursue civil remedies (injunctions, divestitures, fines).
Private Litigation
 Individuals and companies can sue for treble damages (three times the actual damages).
 Class actions are common in antitrust litigation.

6. Recent Trends and Developments

 Biden Administration’s aggressive stance on antitrust enforcement, particularly against tech
giants.
 Lina Khan’s leadership at the FTC has marked a shift toward stronger scrutiny of vertical
mergers and digital platforms.
 Increased focus on labor market competition (e.g., no-poach agreements).
 Emerging debates around using antitrust to achieve broader social goals like privacy,
innovation, and labor rights.

7. Challenges and Criticism

 Difficulty in addressing network effects and data monopolies.
 Balancing innovation with regulation in tech and pharma sectors.
 Judicial conservatism in applying aggressive antitrust theories.
 Debates around whether current antitrust laws are sufficient in the digital age.

8. Conclusion
U.S. competition law is a dynamic field, grounded in over a century of legal precedent and
economic theory. While its foundations lie in the Sherman and Clayton Acts, its application
continues to evolve in response to new market realities. The focus on protecting consumer
welfare remains central, but modern enforcement increasingly considers innovation, privacy,
and market structure in the digital economy. With increasing enforcement actions against
large tech firms and a growing appetite for reform, U.S. antitrust law remains a powerful tool
for regulating competition.

Let me know if you'd like this note shortened for a presentation or expanded with case
summaries!

UK
 Laws preventing anti-competitive agreements have a long history. Some authors in their
works suggest that the first laws against anticompetitive practices date as far back as the
Middle Ages, when cartels, the so-called guilds, were formed in most European cities.
 In English Common law particularly, competition regulation dates back during the era of King
Henry III when a legislation was passed to regulate the inflating prices of bread and beer
taken in comparison to corn. The law was punitive in nature. During 1553, the UK saw the
introduction of tariffs to stabilize the fluctuations in market. Even in the regime of Queen
Elizabeth policies were enforced to ensure breakdown of monopolies and cartels.
 The UK saw a plethora of Common Law precedents, being laid down by the House of Lords
for enforcement of Anti-Competitive measures but the same were given a structured outlook
on Introduction of the Competition Acts passed by the parliament.
 In the UK, the restrictions on the anti-competitive practices are a product of two primary
legislations, the Competition Act 1998 and the Enterprise Act 2002 , whose combined
reading and interpretation regulates the corporates and enterprises in the country.

 Competition Act 1998: The provisions of the statute aim to oversee and prevent:
 Agreements between enterprises which might prevent, restrict, or distort competition in the
UK.
 The abuse of a dominant position in the market which could have an effect in the UK. The
companies concerned do not need to be based in the UK to be caught by the 1998 Act.
 Enterprise Act 2002: The Enterprise Act 2002 aimed to regulate mergers and acquisitions
restricting the free competition practices.
 CMA: The Competition and Markets Authority (CMA) was established to enforce competition
law, replacing the Office of Fair Trading and the Competition Commission.
 Brexit: While the UK is no longer part of the EU, the UK competition law still incorporates EU
principles and jurisprudence.
 Apart from these legislations, a non-ministerial department named CMA (Competition and
Markets Authority), deriving its powers from the competition Act 1988, acts as an
investigative and administrative arm for implementation of the provisions of statues and
keeping a check on activities hindering free and fair competition.
Here’s a detailed note on the Application of Competition Law in the United Kingdom (UK):

Application of Competition Law in the United Kingdom

1. Introduction
Competition law in the United Kingdom seeks to promote fair competition, prevent anti-
competitive practices, and protect consumer welfare. After Brexit, the UK has developed its
independent competition law regime, though it continues to be influenced by EU principles.
The primary legislative instruments include the Competition Act 1998, the Enterprise Act
2002, and the UK Internal Market Act 2020.

2. Legal Framework
a. Competition Act 1998
This Act mirrors EU competition law and includes two main prohibitions:
 Chapter I Prohibition: Prohibits agreements, decisions, and concerted practices that prevent,
restrict, or distort competition (akin to Article 101 TFEU).
 Chapter II Prohibition: Prohibits abuse of a dominant market position (similar to Article 102
TFEU).
b. Enterprise Act 2002
Focuses on merger control and market investigations. It empowers the Competition and
Markets Authority (CMA) to investigate mergers and conduct market-wide studies.
c. Consumer Rights Act 2015
Strengthened private enforcement of competition law, particularly through collective
proceedings before the Competition Appeal Tribunal (CAT).
d. Post-Brexit Changes
 After Brexit, the UK is no longer subject to EU competition law. The CMA now plays a more
prominent role in merger control and antitrust enforcement for transactions that may have
previously been under the European Commission’s jurisdiction.

3. Enforcement Mechanism
a. Competition and Markets Authority (CMA)
The CMA is the main regulatory authority responsible for enforcing competition law. Its
functions include:
 Investigating anti-competitive practices.
 Imposing fines up to 10% of global turnover.
 Conducting dawn raids and using investigatory powers.
 Reviewing mergers and approving or blocking them.
b. Sectoral Regulators
Some industries have their own regulators with concurrent competition powers, such as:
 Ofcom (communications)
 Ofgem (energy)
 Ofwat (water)
 Financial Conduct Authority (FCA)
c. Competition Appeal Tribunal (CAT)
A specialized judicial body that hears appeals against CMA decisions, as well as damages
claims and other competition-related disputes.

4. Key Areas of Application

a. Cartels and Anti-competitive Agreements
Hardcore cartels, such as price-fixing and market sharing, are strictly prohibited. The CMA
actively pursues cartel investigations and may grant leniency to whistleblowers under its
leniency program.
b. Abuse of Dominance
The CMA investigates abuse such as predatory pricing, exclusive dealing, and refusal to
supply. Recent focus has been on digital markets, especially dominant online platforms.
c. Merger Control
UK merger control is voluntary, but the CMA can call in mergers that meet certain
thresholds. Post-Brexit, the UK and EU may both investigate the same merger independently.
d. Market Investigations
The CMA conducts in-depth market studies where competition may not be working
effectively, leading to recommendations, enforcement, or legislative changes.

5. Digital Markets Regulation

The UK is setting up a Digital Markets Unit (DMU) under the CMA to oversee firms with
Strategic Market Status (SMS). The aim is to ensure fair conduct by tech giants and promote
innovation and competition.

6. Private Enforcement
 Individuals and businesses can bring private actions for damages arising from breaches of
competition law.
 Collective proceedings (similar to class actions) are allowed under the CAT.
 The Mastercard v Merricks case set a precedent for consumer collective redress.
 7. Penalties and Remedies
 Fines of up to 10% of a company’s global turnover.
 Director disqualification for up to 15 years.
 Criminal sanctions for individuals involved in cartels (imprisonment up to 5 years).
 Structural remedies, such as divestiture of assets in mergers or dominance cases.

8. International Cooperation
The CMA cooperates with international regulators like the European Commission, US DOJ,
FTC, and others through bilateral agreements and participation in forums like the ICN and
OECD.

9. Challenges and Future Outlook

 Adapting to post-Brexit autonomy while maintaining alignment with global best practices.
 Balancing innovation and competition in rapidly evolving digital markets.
 Strengthening enforcement tools and expanding the role of private litigation.
 Implementing the proposed Digital Markets, Competition and Consumers Bill to modernize
the competition law framework.

Conclusion
UK competition law is robust, evolving, and increasingly independent post-Brexit. The CMA
plays a central role in maintaining competitive markets, and the legal regime continues to
adapt to emerging challenges, particularly in digital and tech-driven economies. With an
increasing focus on consumer welfare, innovation, and market fairness, UK competition law
remains a key pillar of its economic policy.

EU
 Competition law in Europe is divided into two parts, first part is about member countries and
the effect of the law on member states. The second part regulates the transactions between
member countries in terms of trade and business. The first competition law in Europe is The
Treaty Establishing the European Coal and Steel Community or Paris treaty, signed in the
year 1951.
 France, Germany, Italy, Netherlands, Belgium and Luxembourg were the member countries
who signed the treaty, which created a community in trade and business. The objectives of
this treaty are to ensure equal opportunity to member countries in the production of coal
and steel, limit the powers of Germany and ensure free and healthy competition.
 The ECSC treaty in particular dealt with three issues that are commonly addressed in most of
the modern competition laws we see now – anti-competitive agreements, concentrations
and the abuse of dominant positions.
 Art. 65 of the treaty prohibited anti-competitive agreements between undertakings that
tend to directly or indirectly prevent, restrict or distort normal competition within the
market. In this regard, the provision particularly highlighted agreements with regard to fixing
or determination of prices, restrictions or control on production, technical development or
investment and agreements to share markets, products, customers or sources of supply. The
treaty considered all such agreements and decisions as automatically void.
 Later they felt the need of atomic energy regulations and a common market, which lead to
the European Economic Community (EEC) and was signed by all member countries of the
Paris Treaty at Rome in 1957. the important provisions of this treaty are Article 85 and 86,
which prohibits the abuse of dominant position and it also nullified all those agreements
which affect trade between the states by preventing or restricting trade which distorts the
competition in the market. Thereafter the treaty was renamed to Treaty for the functioning
of the European Union (TFEU).
 Article 101 of the treaty prohibits all those agreements which affect the trade between
member states. It also states that all the anti-competitive agreements and decisions are void.
A few exemptions were provided in clause 3 of the article.
 Whereas article 102 of the treaty talks about the abuse of a dominant position, which
includes a provision relating to unfair purchase or selling prices, a provision relating to unfair
trade conditions like limiting productions or applying dissimilar conditions to equivalent
transactions with other trading parties and placing them in negative competition. There are
certain case laws also helped in shaping the competition law in Europe.

Here's a detailed note on the application of Competition Law in the European Union (EU):

Application of Competition Law in the European Union

1. Introduction
Competition law in the European Union (EU) is aimed at promoting fair competition within
the internal market, ensuring consumer welfare, and preventing practices that could distort
trade between Member States. It is primarily governed by the Treaty on the Functioning of
the European Union (TFEU), particularly Articles 101 to 109, with Articles 101 and 102
forming the core of EU competition law.

2. Legal Framework
a. Article 101 TFEU – Anti-Competitive Agreements
Article 101 prohibits:
 Agreements between undertakings
 Decisions by associations of undertakings
 Concerted practices
If they have as their object or effect the prevention, restriction, or distortion of
competition within the internal market.
Examples:
 Price-fixing
 Market sharing
 Output limitations
 Collusive tendering
Exemptions under Article 101(3): Agreements that:
 Improve production/distribution
 Promote technical or economic progress
 Allow consumers a fair share of resulting benefit
 Do not impose unnecessary restrictions or eliminate competition
b. Article 102 TFEU – Abuse of Dominant Position
This prohibits the abuse of a dominant position within the internal market or a substantial
part of it, which may affect trade between Member States.
Forms of abuse:
 Predatory pricing
 Refusal to supply
 Tying and bundling
 Margin squeeze
 Discriminatory pricing

3. Enforcement Mechanisms
a. European Commission
The European Commission, through its Directorate-General for Competition, is the primary
enforcer of EU competition law.
 Investigates complaints and conducts inquiries
 Has powers to carry out dawn raids, interviews, and gather evidence
 Can impose fines up to 10% of global turnover of the infringing firm
b. National Competition Authorities (NCAs)
Under Regulation 1/2003, NCAs and national courts can also apply Articles 101 and 102
directly.
 Ensures decentralized enforcement
 Encourages cooperation through the European Competition Network (ECN)
c. Merger Control (Regulation 139/2004)
Merger control ensures that concentrations (mergers, acquisitions) do not significantly
impede effective competition.
 Applies to mergers exceeding turnover thresholds (EU dimension)
 Pre-notification and approval process
 Remedies and commitments possible for conditional clearance

4. State Aid (Articles 107–109 TFEU)

Competition law also regulates State aid to ensure governments do not unfairly distort the
market by giving selective economic advantages.
 Article 107(1) prohibits incompatible aid
 Article 107(2) and (3) provide exemptions (e.g., regional development, environmental
protection)
 The European Commission has exclusive competence to assess and authorize aid

5. Sector-Specific Application
EU competition law is also applied in:
 Telecommunications
 Energy
 Pharmaceuticals
 Digital markets
The Digital Markets Act (DMA) and Digital Services Act (DSA) complement competition law
by targeting gatekeepers and large online platforms.

6. Recent Developments and Cases

a. Google Cases
 Fines totaling over €8 billion for abusing dominance in online search, Android, and AdSense
markets.
b. Apple, Amazon, and Meta Investigations
 Alleged abuse of dominance, unfair trading practices, and preferential treatment of own
products.
c. DMA Implementation
 Applies to major platforms designated as gatekeepers, introducing ex-ante obligations.

7. Private Enforcement
Following the Damages Directive (2014/104/EU):
 Victims of anti-competitive behavior can claim compensation
 National courts play a role in assessing harm, causation, and damages
 Facilitates access to evidence and promotes follow-on actions

8. Challenges and Way Forward

 Globalization of markets and digitalization raise new issues
 Interplay with national laws and extraterritorial reach
 Ensuring consistency and effective cooperation between EU and national authorities
 Balancing innovation and competition, especially in tech markets

Conclusion
The application of competition law in the EU plays a vital role in safeguarding the internal
market, protecting consumers, and promoting innovation and fair trade practices. With
evolving digital and global market dynamics, the EU continues to adapt its enforcement and
regulatory frameworks to maintain a competitive economy.

SACHAR COMMITTEE REPORT

 The Sachar Committee on Competition Law, established by the Government of India in 1977
under the chairmanship of Justice Rajinder Sachar, was tasked with evaluating the
effectiveness of the Monopolies and Restrictive Trade Practices Act (MRTP Act) of 1969 and
suggesting necessary amendments to enhance its scope and implementation
 The MRTP Act of 1969 was India's initial legislative framework aimed at curbing
monopolistic, restrictive, and unfair trade practices to promote fair competition in the
market. However, as the Indian economy evolved, concerns arose regarding the Act's
adequacy in addressing emerging market complexities and its limited impact on controlling
monopolistic behaviors. In response, the government constituted the Sachar Committee in
1977 to conduct a comprehensive review of the MRTP Act's performance and recommend
improvements.
 Over the period of time it was realized that the objectives of MRTP, Act could not be
achieved to the desired extent. Accordingly a high powered expert committee known as
Sachar Committee11was set up by the government. The committee was asked to report on
following: - To consider and report on what changes are required to be made in the MRTP
Act so as to make it more effective wherever necessary. - Any matter incidental or ancillary to
the administration of the MRTP Act trade, commerce and industry.
 The Sachar Committee identified several limitations in the MRTP Act:
1) Limited Authority of the MRTP Commission: The Committee observed that the MRTP
Commission's role was predominantly advisory, lacking the necessary enforcement
powers to effectively curb monopolistic and restrictive practices.
2) Exclusion of Public Sector Undertakings (PSUs): The MRTP Act did not encompass PSUs
within its purview, which was a significant omission given the substantial role of PSUs in
the Indian economy.
3) Inadequate Coverage of Unfair Trade Practices: The Act did not sufficiently address unfair
trade practices, particularly those related to consumer protection, leaving consumers
vulnerable to exploitation.

Recommendations of Sachar Committee

 The Sachar Committee looked into practical difficulties of the operation of law and
found that the role assigned to the MRTPC was limited and mostly advisory. Thus it
was imperative to make the MRTPC more effective and independent. The committee
also recommended for inclusion of government undertakings under the purview of
MRTPC except for expansions, setting up of new undertakings, mergers.
 The committee sought to include unfair trade practices like misleading
advertisements into the existing law because consumers had no safeguards against
such practices. To quote the Sachar Committee: Advertisements and sales
promotions have become well established modes of modern business techniques.
Advertisements and representations to the consumers should not become deceptive
has always been one of the points of conflict between business and consumers”.
 In country like India vast majority of consumers are illiterate and have very limited
purchasing power and as such they get exposed to false or misleading information
and left with only options of substandard, adulterated, unsafe and less useful
products. The Sachar Committee therefore recommended widening the scope of
MRTP Act to include unfair trade practice like misleading and deceptive trade
practices within its ambit so that consumers, manufacturers, buyers can
conveniently identify the practices that are prohibited. Subsequently the MRTP Act
was amended and unfair trade practices were brought within its ambit.
 On the basis of the Sachar Committee report the MRTP Act was amended. The
amendments made to the provisions 12 dealing with Restrictive Trade Practices in
1984 brought in the principle of deemed illegality to a host of trade practices for
which registration was made compulsory. The 1984 amendments incorporated
provisions relating to Unfair Trade Practices in section 36 A which dealt with cases of
misrepresentation as well as misleading advertisements
 Following the adoption of economic reforms in 1991, far reaching amendments were
introduced. The 1991 amendment removed the need for prior government approval
to establish new undertakings or the expansion of already existing undertakings or
mergers. The amendment further removed exemption granted to government
enterprises and cooperative sector. The focus was on curbing monopolistic,
restrictive and unfair trade practices. The idea of size as a factor to overcome
concentration of power was given up.

RAGHAVAN COMMITTEE REPORT

 The Raghavan Committee Report, officially known as the “Report of the High-
Powered Expert Committee on Competition Law and Policy,” established by the
 Government of India in October 1999, was a significant milestone in the evolution of
competition law in India.
 The committee, headed by Dr. Raghavan, was appointed by the Government of India
in 2000 to review and recommend changes to the existing competition law
framework in the country. Its primary mandate was to examine the existing
competition policies and laws in India and to recommend a modern framework
suitable for the evolving economic landscape.
 The late 1990s in India marked a period of significant economic reform. With the
waves of liberalization, privatization, and globalization, there was a pressing need for
an updated competition policy.
 Prior to the 1990s, India's economic framework was characterized by a controlled
and regulated environment, with the Monopolies and Restrictive Trade Practices Act
(MRTP Act) of 1969 serving as the primary legislation to curb monopolistic and
restrictive trade practices. However, with the liberalization and globalization of the
Indian economy in the 1990s, it became evident that the MRTP Act was inadequate
in addressing the complexities of a market-driven economy. Recognizing the need for
a robust competition policy to promote fair competition and protect consumer
interests, the government constituted the Raghavan Committee to undertake a
comprehensive review and suggest necessary reforms.
 The Committee was tasked with a monumental job. It had to sift through the
complexities of economic policies and legal frameworks to ensure that competition
within Indian markets was not just a theoretical concept but a practical reality. They
were to lay down the guidelines that would prevent practices having adverse effects
on competition, promote and sustain competition, protect the interests of
consumers, and ensure freedom of trade.
 The Committee didn’t work in isolation; it drew inspiration from the competition
laws of various jurisdictions like the EU, US, and Canada. This comparative analysis
was crucial in crafting a law that could stand shoulder to shoulder with international
norms while being uniquely suited to India’s market conditions.
 The Raghavan Committee identified several shortcomings in the existing MRTP Act:

 Inadequate Coverage: The MRTP Act primarily focused on curbing

monopolistic practices but lacked provisions to effectively address anti-
competitive agreements, abuse of dominant positions, and regulation of
mergers and acquisitions.
 Limited Enforcement Mechanism: The MRTP Commission, established
under the Act, had limited powers and lacked the necessary authority to
enforce its orders effectively.
 Exclusion of Public Sector Enterprises: The Act did not encompass public
sector undertakings, leaving a significant portion of the economy outside its
purview.
 Absence of Advocacy Role: There was no provision for competition
advocacy to promote a competitive environment through policy
recommendations and public awareness.

Recommendations
  The Raghavan Committee’s report, submitted in May 2000, was comprehensive and
forward-thinking. It made several key recommendations that would later become
the pillars of the Competition Act, 2002.
 The committee recommended the repeal of the Monopolies and Restrictive Trade
Practices Act (MRTP Act) and the introduction of a new competition law framework
in India. This led to the subsequent enactment of the Competition Act, 2002.
 The committee recommended the establishment of an independent regulatory body,
the Competition Commission of India (CCI), to enforce competition law, investigate
anti-competitive practices, and promote fair competition.
 The committee recommended provisions to prohibit anti-competitive agreements,
cartels, and abuse of dominant market positions. These provisions aimed to prevent
practices that could distort competition and harm consumer interests.
 The committee recommended the introduction of provisions to regulate mergers,
acquisitions, and other combinations that may have an adverse impact on
competition. This led to the inclusion of provisions related to merger control in the
Competition Act, 2002.
 The committee emphasized the importance of consumer welfare and recommended
provisions to protect consumer interests from unfair trade practices, misleading
advertisements, and deceptive conduct.
 The recommendations of the Raghavan Committee Report laid the groundwork for
the Competition Act, 2002, which replaced the outdated MRTP Act. The Competition
Act, 2002, introduced a modern and comprehensive competition law framework in
India, aligning it with international best practices. The establishment of the
Competition Commission of India (CCI) as an independent regulatory authority was a
significant outcome of the report.
 The Competition Act, 2002, and the establishment of the CCI have played a pivotal
role in promoting fair competition, preventing anti-competitive practices, and
protecting consumer interests in India. The CCI has been actively involved in
enforcing competition law, investigating anti-competitive behavior, and imposing
penalties on violators.

MRTP Act (Monopolies and Restrictive Trade Competition Act, 2002

Practices Act)

The MRTP Act is a legislation that was established in The Competition Act, 2002 is a legislation that was
1969 with the primary objective of curbing established in 2002 with the primary objective of promoting
monopolistic practices and promoting competition and protecting competition in the Indian market.
in the Indian market.

The MRTP Act is regulated by the Ministry of The Competition Act, 2002 is regulated by the Competition
Corporate Affairs. Commission of India (CCI).

The MRTP Act has provisions for the regulation of The Competition Act, 2002 has provisions for the
monopolies and the prevention of restrictive trade prevention of anti-competitive agreements, the regulation
practices. of combinations (mergers and acquisitions), and the
prevention of abuse of dominant position.

Penalties for non-compliance under the MRTP Act Penalties for non-compliance under the Competition Act,
include fines and imprisonment. 2002 include fines and penalties for individuals and
companies.

The MRTP Act is not applicable to certain sectors The Competition Act, 2002 applies to all sectors of the
like agriculture, small-scale industries and services. economy.

The MRTP Act does not have provision for leniency The Competition Act, 2002 has provision for leniency policy.
policy.

The MRTP Act does not have provision for The Competition Act, 2002 has provision for settlement of
settlement of cases. cases.

OBJECTIVES AND SALIENT FEATURES OF COMPETITION ACT 2002

1. To prevent practices having adverse effect on competition

o The Act seeks to prohibit anti-competitive agreements, abuse of dominant

position, and regulate combinations (mergers, acquisitions) that may harm
competition.

2. To promote and sustain competition in the market

o Encourages fair competition and discourages monopolistic behavior, ensuring a

level playing field for all players in the market.

3. To protect the interests of consumers

o Ensures that consumers have access to a wider range of goods and services at
competitive prices and are not subjected to unfair trade practices.

4. To ensure freedom of trade carried on by other participants in markets

o Prevents restrictive practices that can obstruct businesses from entering or freely
operating in the market.

5. To establish a Commission to deal with competition issues

o The Act led to the establishment of the Competition Commission of India (CCI) to
implement and enforce its provisions.

6. To promote competition advocacy and create awareness

o The Act emphasizes the role of the CCI in promoting competition advocacy,
training, and public awareness on the importance of competition for economic
development.

key features to achieve its objectives effectively:

1. Prohibition of anti-competitive agreements: The act prohibits any agreement between enterprises
that causes or is likely to cause an appreciable adverse effect on competition in India.

2. Regulation of combinations: The act regulates mergers, acquisitions, and amalgamations of

enterprises if they result in or are likely to result in an appreciable adverse effect on competition
3. Consumer welfare: The act prioritizes consumer welfare and considers its impact on all
competition-related decisions.

4. Establishment of Competition Commission of India (CCI): The act establishes the CCI as an
independent statutory body to enforce and implement the provisions of the act.
5. Power to investigate and penalize: The CCI has the power to investigate and impose penalties on
enterprises for anti-competitive practices.

6. Leniency policy: The act provides a leniency policy for enterprises that cooperate with the CCI in
its investigation of anti-competitive practices.

7. Appeal process: The act provides for an appeal process to the Competition Appellate Tribunal for
enterprises that are dissatisfied with the CCI’s decisions.

8. Types of anti-competitive practices: The act prohibits anti-competitive practices such as abuse of
dominant position, price fixing, market allocation, and collusive bidding.

9. Competition advocacy: The CCI has the mandate to promote and advocate for competition in the
market, including through education and outreach programs.

10. Penalties: Penalties for contravening the provisions of the act include fines up to 10% of the
enterprise’s average turnover for the preceding three financial years.

11. Compensation for damages: The act provides for a civil remedy for contraventions of the
provisions of the act, including compensation for damages to parties affected by anti-competitive
practices.

12. Sou Moto: CCI’s Director General who is appointed by the CG can conduct Suo moto and levies
punishment to those firms which affect the market in a negative way.

13. Limitation period: The act has a limitation period of three years for filing complaints with the CCI.