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  • 27 August, 2022

  • 8 Min Read

The Competition (Amendment) Bill, 2022

The Competition (Amendment) Bill, 2022

The Competition Act, 2002 Amendment Bill was just ultimately introduced in the Lok Sabha.

Need to Bring these Amendments

  • New Age Market: Changes were required to maintain and foster market competition as the market's characteristics changed quickly as a result of technological breakthroughs, artificial intelligence, and the growing importance of factors other than price.
  • Issue of Acquisition: Section 5 of the act states that parties engaging in mergers, acquisitions, or amalgamations only need to inform the Competition Commission of India of a combination on the basis of assets or turnover.
  • Gun Jumping: This occurs when two or more parties to a merger or acquisition consummate a notified transaction before it is approved or have completed a reportable transaction without informing the Commission.
  • Hub-and-Spoke Cartels: A hub-and-spoke arrangement is a type of cartelization in which players with a vertical relationship operate as the spoke and impose horizontal limitations on suppliers or retailers.
  • Currently, only businesses in related industries that engage in anti-competitive behaviour are covered by the ban on anti-competitive agreements.
  • This disregards the hub-and-spoke cartels that suppliers and distributors operate at various levels of the vertical chain.
  • have either completed a reportable transaction without notifying the Commission or have done so before the approval

Proposed Amendments

  • Deal value Threshold: A deal value threshold is being added by the new bill.
  • The Commission must also be notified of any transaction with a deal worth greater than 2,000 crores and if either party has significant business operations in India.
  • Significant Business Activities: The Commission is required to create regulations that specify the criteria for determining whether a company has significant business operations in India.
  • It would improve the Commission's assessment process, especially in the digital and infrastructure sectors, where the majority of cases were not previously disclosed because the asset or turnover amounts fell below the legal requirements.
  • Exemption of Open Market Purchases: It is suggested to waive the need to notify the Commission ahead of time for open market purchases and stock market transactions.
  • Hub-and-Spoke Cartels: The amendment expands the definition of "anti-competitive agreements" to include organizations that aid in the formation of cartels even when they do not engage in similar business operations.
  • Settlements and Obligations: A framework for settlements and commitments in cases involving vertical agreements and abuse of dominance is proposed in the new amendment.
  • The parties may file an application for a commitment before the Director General (DG) submits the report, just like in the cases of vertical agreements and abuse of power.
  • After hearing from all parties involved in the case, the Commission's decision on commitment or settlement will no longer be subject to appeal.
  • Provision of Leniency Plus: It permits the commission to grant an additional waiver of penalties to a candidate who discloses the existence of a different cartel in an unrelated market, provided that the information allows the Commission to reach a preliminary conclusion about the existence of the cartel.
  • Director General Appointment: The Commission has more influence when a Director General is chosen by the Commission rather than the Central government.
  • It grants the Commission more authority.

Guidelines In relation to Penalties:

  • The Commission will create regulations outlining the severity of certain competitive infractions.
  • The party must pay 25% of the penalty sum in order for the National Company Law Tribunal (NCLT) to hear an appeal against the Commission's order.

Competition Commission of India

  • In order to administer, implement, and enforce the Competition Act, 2002, the Government of India established the Competition Commission of India (CCI) in March 2009. It focuses on three anti-competitive market issues in particular:
  • monopolistic agreements.
  • misuse of power.
  • Combinations


  • Eliminate tactics that have a negative impact on competition.
  • sustain and encourage competition.
  • Keep consumers' interests in mind.
  • Ensure that trade is unrestricted in India's markets.
  • Create a strong competitive atmosphere by:
  • proactive interaction with all parties, such as customers, businesses, governments, and international organisations


  • One Chairperson and six Members of the Commission are chosen by the Central Government.
  • The commission is a quasi-judicial entity that deals with other issues as well as provide advice to statutory bodies.
  • All other Members, including the Chairperson, must be full-time members.

Way Forward

  • With the proposed adjustments, the Commission should be able to better control several facets of the New Age market and strengthen its functioning.
  • The suggested adjustments are unquestionably required, but they heavily rely on the regulations that the Commission later notifies.
  • The government must also acknowledge that because market dynamics are dynamic, legislation must be revised frequently.

Also, Read - Electronics manufacturing in India

Source: The Hindu

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