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Empowering CCI for negotiated case settlements

GS Paper 2

Syllabus: Statutory and non-statutory bodies

 

Source: Live Mint

Context: Government has introduced the CCI bill which will allow it to settle cases with businesses accused of anti-competitive practices, including abuse of their dominant positions.

At present, the CCI is empowered to show leniency and give full exemption from penalty to a member of a cartel who makes vital disclosures about the existence of the cartel and cooperates with investigations, but negotiated settlements are not part of the rule book.

Previously, the Securities and Exchange Board of India (Sebi) and the income tax department has offered settlements under different schemes.

  • International practices: Negotiated ‘settlements and commitments’, are allowed in the EU, Japan and the US, to quickly resolve cases through financial or non-monetary provisions to reduce litigation.
  • Benefits: Settlements and commitments will help to avoid extensive procedures, cut down litigation, and make enforcement more effective while improving the investment climate for businesses by reducing uncertainty.

 

Competition (Amendment) Bill, 2022: – It has been introduced to improve regulatory setup by increasing the CCI’s accountability, giving it flexibility and enforcement efficiency.

Key changes made in the bill

  • Increasing transparency and strengthening accountability:
  • A board with part-time membersto supervise CCI activities.
  • CCI to mandatorily issue penalty guidelinesand give reasons in case of any divergence.
  • Enforcement efficiency
    • CCI could engage in structured negotiations with parties and arrive at mutually-workable solutions without having to go through lengthy formal proceedings.
  • Changes in the governing structure of CCI
    • The regulator at present has two members in addition to chairperson Ashok Kumar Gupta, though the law allows up to six members.
  • Provisions for regulation of the digital economy

 About:

The Competition Commission of India (CCI) is a statutory and quasi-judicial body working under the Ministry of Corporate Affairs. It was established under the Competition Act, 2002 for the administration, implementation and enforcement of the Act, and was duly constituted in March 2009.

 

Insta Links:

Competition Commission of India

 

Practice Questions:

Q. The role of the Competition Commission of India has been very important to regulate the process and achieve the public policy goal of competition in India. Comment (10M)