Lok Sabha , the Lower House of the Indian Parliament on 29.03.2023 passed the much awaited Competition Amendment Bill, 2002 ("the Bill"). The Bill was introduced in the Lok Sabha on 05.08.2022 and was referred to Standing Committee on Finance for examination and report thereon on 17.8.2022.
The Standing Committee on Finance (under the chairmanship of Shri Jayant Sinha) submitted its report on the Competition (Amendment) Bill, 2022 on 13.12.2022 in the form of 52nd Report, Standing Committee on Finance (2022-2023). The report was presented before the Lok Sabha and Rajya Sabha on 13.12.2022.
The Lok Sabha passed the Bill, with 13 amendments, on Wednesday, 29.3.2023.
The key highlights of the Amendments proposed in the Bill are:
- More clarity is provided in certain definitions like "enterprise", "relevant product market", "Group", "Control", etc.
- The concept of "Hub and Spoke" Cartel has been introduced by broadening the scope of vertical anti-competitive agreements and inclusion of a party facilitating an anti-competitive horizontal agreement under such agreements.
- Reduction of time-limit for approval of combinations from two hundred and ten days to one hundred and fifty days and for forming a prima facie opinion by the Commission within twenty days (from existing 30 days) for expeditious approval of combinations.
- Provisions for "value of transaction" which expands the definition of combinations to include transactions with a deal value above Rs 2,000 crore.
- Change in definition of "control" from "decisive influence" to 'material influence' while assessing mergers & acquisitions .
- Limitation period of three years for filing information on anti-competitive agreements and abuse of dominant position before the Commission.
- Introduction of Settlement and Commitment framework to reduce prolonged litigations.
- Introduction of Leniency plus: Incentivizing parties in an ongoing cartel investigation in terms of lesser penalties to disclose information regarding other cartels.
- Substitution of a provision which provides for penalty up to rupees one crore or imprisonment up to three years or both in case of contravention of any order of the National Company Law Appellate Tribunal with provision for contempt.
The Bill now will be introduced in Rajya Sabha, and with the Government having majority in the Upper House, this Bill becoming an Act is just a matter of time.
COMMENT: The Bill is definitely coming up with some major and forward looking amendments, however, this will come with a challenge for the Commission too. The introduction of concepts of Settlement and Commitment will require framing new regulations, similar is the case with the "Deal Value Threshold". The post of the Chairman , CCI is itself vacant for almost five months now and due to lack of statutory quorum, the CCI adjudicatory function has almost come to a standstill. With the proposed amendments in the Bill ,ushering the new "Competition Act 2.0" regime, the road of growth of Competition Law in India does not look smooth ahead at least for now.
This Article was first published on www.competitionlawyer.in on 30.03.2023
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