Government proposes changes to competition law
New Delhi: The government on Friday proposed a raft of amendments to the competition law, including the introduction of a settlement framework, a reduction in the time limit for combination approvals and incentivisation for parties to disclose information in cartel probes.
The Competition (Amendment) Bill, 2022, introduced in the Lok Sabha on Friday, has also proposed provisions for having 'value of transaction' as a criteria for notifying combinations to the Competition Commission of India (CCI).
Other amendments suggested include a limitation period of three years for filing information on anti-competitive agreements and abuse of dominant position before the CCI, changes in certain definitions like 'enterprise', 'relevant product market', 'group' and 'control' to provide clarity.
The government is also looking to broaden the scope of anti-competitive agreements and the inclusion of a party facilitating an anti-competitive horizontal agreement under such pacts and substitute the provision pertaining to penalty.
The provision providing for penalty up to Rs 1 crore or imprisonment up to three years or both in case of contravention of order of National Company Law Appellate Tribunal would be replaced with provision for contempt. Another change proposed is reducing the time limit for approval of combinations to 150 days from current 210 days and also requiring CCI to form a prima facie opinion within 20 days for expeditious approval of combinations.
The government also plans to introduce a "Settlement and Commitment framework to reduce litigations" and incentivise parties in an ongoing cartel investigation in terms of lesser penalty to disclose information regarding other cartels.
Among other amendments, the government has proposed the appointment of the Director General by the CCI with the prior approval of the central government and issuance of guidelines, including penalties to be imposed by the CCI.
In the Statement of Objects and Reasons for the bill, the government said there has been a significant growth of Indian markets and a paradigm shift in the way businesses operate in the last decade.
The Competition Law Review Committee, set up by corporate affairs ministry which is implementing the Act, had suggested various changes.
"After review of the recommendations proposed by the committee, public consultations and with a view to provide regulatory certainty and trust-based business environment, it is considered imperative to amend the said Act," it said.
