Understanding Competition Law in India: Key Cases and Concepts

Key Mergers & Acquisitions

• Etihad Airways and Jet Airways
• Sun Pharma and Ranbaxy
• Wal-Mart and Flipkart

Section 26 (1) of the Competition Act

On receipt of a reference from the Central/State Government, statutory authority, or upon its knowledge/information (under section 19), if the Commission believes a prima facie case exists, it shall direct the Director General to investigate.

Relevant Cases

• CCI v. Steel Authority of India Ltd

Section 27(b): Penalties

The Commission may impose penalties, not exceeding 10% of the average turnover for the last three financial years, upon enterprises party to anti-competitive agreements or abuse of dominance.

Relevant Cases

• Excel Crop Care Ltd v. CCI

Section 3(3): Anti-Competitive Agreements

Agreements that cause or are likely to cause an appreciable adverse effect on competition (AAEC) within India.

• (a) Price Fixing
• (b) Limiting or Controlling Production
• (c) Market Allocation
• (d) Bid Rigging

Section 3(4): Vertical Agreements

Agreements among enterprises at different stages of the production chain, including:

• (a) Tie-in Arrangement
• (b) Exclusive Supply Agreement
• (c) Exclusive Distribution Agreement
• (d) Refusal to Deal
• (e) Resale Price Maintenance

Relevant Cases: Vertical Agreements & Cartels

• Builders Association of India v. Cement Manufacturers Cartel (Price Fixing)
• Exclusive Motors Pvt. Ltd. v. Automobile Lamborghini S.P.A (Vertical Agreements)
• Shamsher Kataria v. Honda Siel Cars India Ltd. (Cartel)
• Rajasthan Cylinders and Containers Limited v. Union of India (Bid Rigging, Cartel)
• Samir Agrawal v. CCI (Horizontal Agreements, Cartel)

Section 4: Abuse of Dominant Position

Relevant Cases

• Belaire Apartment Owners' Association v. DLF
• Surinder Singh Barmi v. BCCI
• MCX Stock Exchange v. National Stock Exchange Ltd.
• National Stock Exchange Ltd. v. MCX Stock Exchange
• Indian Exhibition Industry Association v. Ministry of Commerce

Leniency (Section 46)

The Commission may impose a lesser penalty on a cartel member who makes a full and true disclosure of violations, provided it is vital and made before the Director General's report.

Proviso: Leniency is applicable only if full, true, and vital disclosures are made before the DG report.

Cartel Cases

• Cartelization in Zinc Carbon Dry Cell Batteries Market in India
• Cartelization in tenders by Indian Railways for Brushless DC Fans and other electrical items

Section 3(5)

Relevant Cases

• Competition Commission of India v. Bharti Airtel Ltd (TRAI)
• Telefonaktiebolaget LM Ericsson (PUBL) v. Competition Commission of India

Section 19 (4): Factors for Determining Dominant Position

The Commission shall consider the following factors while determining dominant position under Section 4:

• (a) Market Share of the enterprise
• (b) Size and Resources of the enterprise
• (c) Size and Importance of competitors
• (d) Economic Power of the enterprise, including commercial advantages
• (e) Vertical Integration and sales/service network
• (f) Dependence of Consumers on the enterprise
• (g) Monopoly or Dominant Position acquired through statute, government company, or PSU
• (h) Entry Barriers (regulatory, financial, etc.)