All That is to Know, for CEOs, on Competition Law-A CEO’s Pocket Guide on Competition Law

-K K Sharma1

All around there is a huge curiosity in India about the newly introduced competition law. However, lack of suitable and concise literature has made it a lawyers’ paradise and, practically, beyond the reach of the decision makers who ,while needing to understand an overall picture of this new addition in the regulatory landscape of the country, are always on the move and very short on time. In absence of any credible alternatives, the CEO has the easy option of leaving all these issues in the hands of a lawyer. Despite being an option, this would not give CEOs the comfort which an informed decision making would have given if he had a mechanism to understand the subject without having to invest too much time in the process.The author, K K Sharma, had the privilege of being involved in the establishment, virtually brick by brick, of Competition Commission of India (CCI). He was the very first Director General of the functional CCI. Later, he was also the Head of Merger Control and Anti Trust Divisions of CCI. In this write up he, practically, covers all that is there to be known on competition law.

he aim of this primer is not to be a comprehensive guide on competition law but to give an overall bird’s eye view of the entire law and procedure on this new but important subject to CEOs enabling them to be in charge of the affairs of the

enterprise and not an unwitting victim of competition law violations. TThe evolution of competition law in India dates back to 1960’s with the enactment of the Monopolistic and Restrictive Trade Practices Act, 1969 (MRTPA), a statute to check monopolistic, unfair and restrictive trade practices. However, over a period of time, with rapid global economic development, it became obvious that the provisions of MRTPA were grossly inadequate to meet the challenges of the present day economic realities. This eventually paved the way for the enactment of Competition Act, 2002 (the Act). The Act

received the presidential assent on 13th January 2003. The provisions of the Act relating to anti-competitive agreements and abuse of dominant position were notified on May 20, 2009. However, the complete enforcement could begin only from June 11, 2011, when the provisions relating to combinations came into force.

To give a perspective, the flow of sequence of the contents , in this write up, is arranged in following order:

Sl.No. Topic Page No.

1

2

Timeline of Evolution of Competition Law in India

Key Features of the Act

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1 Ex Director General and Head, Merger Control and Antitrust Divisions, CCI and Commissioner of Income Tax. The views expressed by author are his own.

3 Prohibition of Anti-Competitive Agreements[Section 3] ...

4 Prohibition of Abuse of Dominant Position[Section4] ...

5

6

7

8

Procedure For Filing Information With the Competition Commission of India (CCI) Regarding Anti-Competitive Agreements and Abuse of Dominant Position

Formation of Prima-facie opinion by CCI

Scheme for Enquiry of matter referred to Director General (DG-CCI)

Procedure after director general submits enquiry report [section 26 of the Act and reg. 21 of CCI (General) Regulations, 2009]

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..

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9 Orders of CCI under Section 27 of the Act ...

7 Regulation of Combinations [Sections 5 & 6 of the Act] ...

8 Order of CCI under Section 31 of the Act ...

9 Penalties imposed by CCI ...

10

11

Recovery of Monetary Penalty by CCI

Contravention of the Orders of CCI: Claim & Compensation

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12 Appeal to the competition appellate tribunal (COMPAT)- [Section 53B of the Act]

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12 Appeals before the Supreme Court ...

13 Glossary/ Important Terms ...

Timeline of Evolution of Competition Law in India

1964 - Mahalanobis Committee Report on Distribution and Levels of Income- Committee gave a finding that top 10 % of the population cornered 40 % of income and big business houses were emerging because of planned economy model.

1965 - Monopolies Inquiry Commission Report of Das Gupta, Government of India appointed this Inquiry Commission ―to inquire into the existence and effect of concentration of economic power in private hands and prevalence of monopolistic activities. Reported that there was concentration of economic power and a few industrial houses were controlling a large number of companies and there existed large scale RTP & MTP

1967 – R.K. Hazari Committee Report on Industrial Planning and Licensing Procedure -Working of the licensing system has resulted in disproportionate growth of some big houses which had led to pre-emption and foreclosure of capacity.

1969 - Monopolies & Restrictive Trade Practices Act was enacted 1984 – The MRTP Act was amended to include provisions for Unfair Trade

Practices. 1991 – The 1991 Amendment to MRTP Act omitted provisions in respect of

Concentration of Economic Power. 1999- The Government appointed a committee on Competition Policy and Law

under the chairmanship of Mr. S. V. S. Raghavan in October 1999 for shifting the focus of the law from curbing monopolies to promoting competition in line with the international environment. The Committee presented its Competition Policy report to the Government on May 22, 2000

The Competition Bill, 2002 introduced in Lok Sabha on 6th August 2001 and passed on 16th December 2002

The Competition Bill, 2002 passed by Rajya Sabha on 21st November 2002 The Competition Bill, 2002 received President‘s assent on 13th January 2003 The Competition (Amendment) Bill, 2006 was introduced in the Lok Sabha on

March 9, 2006. June 5, 2006 - Planning Commission constituted a Working Group on

Competition Policy The Parliamentary Standing Committee on Finance [Chairperson: Maj. Gen.

(Retd.) Bhuwan Chandra Khanduri] submitted its report on December 12, 2006.

The Competition (Amendment) Bill, 2006 was withdrawn and replaced by the Competition (Amendment) Bill, 2007 on Aug 29, 2007

The Competition Amendment Bill, 2007 was passed by Lok Sabha on 6th

September, 2007 The Competition Amendment Bill, 2007 was passed by Rajya Sabha on 10th

September, 2007 The Bill was passed by the President on 24th September 2007. The

Competition Appellate Tribunal was established through the 2007 Amendment.

15th May, 2009 – Government issued notifications giving effect from 20th May, 2009 to, among others, the provisions dealing with anti-competitive agreements (section 3) and abuse of dominance (section 4) in the Competition Act.

2011 – Notified provisions relating to regulation of combinations with effect from 1st June, 2011.

Key features of the Act:

The Act provides for the establishment of a Commission to:

o Prevent practices having adverse effect on competition;o Promote and sustain competition in markets;o Protect the interests of consumers; ando Ensure freedom of trade carried on by other participants in markets in India;o For matters connected therewith or incidental thereto.

The Act prohibits enterprises from entering into anti competitive agreements, or abuse of dominant position and regulates combinations subject to certain thresholds (as explained later in this article).

The Commission has authority to inquire into any anti-competitive agreements or abuse of dominant position by enterprises. The Commission can start inquiry on its own motion or on receiving information from the aggrieved party or pursuant to receipt of a reference by the Central Government, State Governments or any statutory authority.

The Act provides for the establishment of a competition appellate tribunal (COMPAT) to hear and dispose of appeals against any direction issued or decision made or order passed by the Commission under some particular sections of the Act. Party aggrieved by any decision or order of the Appellate Tribunal may file an appeal before the Supreme Court within sixty (60) days from the date of communication of the decision or order of the Tribunal to them.

The Act has an overriding effect notwithstanding anything inconsistent contained in any other law for the time being in force.

The Act specifically excludes the jurisdiction of civil courts to entertain any suit or proceeding, which CCI or the Appellate Tribunal is empowered by or under this Act to determine and also no injunction can be granted by any Court or authority in respect of any action taken or to be taken in pursuance of any power conferred by or under the Act.

The Commission is not bound by the procedure laid down by Code of Civil Procedure, 1908, but shall be guided by the principles of natural justice. It has the powers to regulate its own procedure including the places at which they shall have their sittings etc.

The Commission has been empowered to grant interim relief, impose penalty and to levy penalty for contravention of its orders, making of false statements or omission to furnish material information, etc.

Prohibition of Anti-Competitive Agreements [Section 3]

No person or enterprise, inter alia, shall enter into any agreement relating to the production, supply distribution, storage, acquisition or control of goods or provision of services which causes or is likely to cause an appreciable adverse effect on competition (AAEC) in India. All such agreements shall be void.

Anti-competitive agreements are further divided into two categories:

i. Presumed Anti-Competitive Agreements - [Section 3(3)] or ‘Horizontal Agreements’ – These are agreements where enterprises engaged in identical or similar trade of goods or provisions of services conclude agreements with one another. These are

presumed to have an AAEC and the burden of proof is on the opposite party to prove otherwise. It includes agreements, entered into between association of enterprises – including cartels – involved in similar trade of goods or services, which seeks:

Sale-price determination; Production control or limiting production, supply, technical

development or provision of services; Market-sharing by geographical area allocation, type of goods or

services or customer allocation; OR Bid-rigging or collusive bidding

ii. Anti-Competitive Agreements-Not Presumed to be Anti-Competitive- [Section3 (4)] or ‘Vertical Agreements’ – These are agreements between enterprises operating at different levels of the production chain. These shall be considered anti-competitive only if they have an AAEC in India. These include agreements which provide for:

Tie-in arrangement; Exclusive supply agreement; Exclusive distribution agreement; Refusal to deal; or Resale price maintenance It is important to note that any agreement by a person or enterprise which seeks to restrict any infringement of his IPR or imposes reasonable conditions for use of the same shall not constitute an anti-competitive agreement. Agreement relating exclusively for export of goods and services shall not be covered under Section 3.

Prohibition of Abuse of Dominant Position: [Section 4]

Abuse of dominant position is an anathema to fair competition between firms, leads to exploitation of consumers and makes it difficult for other players to compete with the dominant undertaking on merit alone. The Act provides that no enterprise shall abuse its dominant position. It should be noted that dominant position itself is not prohibited; only its abuse is prohibited.

i. Dominant Position: It is a position of strength, enjoyed by an enterprise, in the relevant market, in India, which enables it to—

operate independently of competitive forces prevailing in the relevant market; or

affect its competitors or consumers or the relevant market in its favour

ii. Abuse of Dominant Position: It shall be considered as an abuse of dominant position if an enterprise in dominant position:

Imposes unfair or discriminatory condition/s in the price or in purchase or sale, of goods and/or services;

Indulges in predatory pricing; Limits or restricts production or technical or scientific

development of goods and services or market; Denies market access in any manner; Concludes contracts with other parties subject to other parties’

acceptance of supplementary unrelated contracts; OR Uses its dominant position in one relevant market to enter into, or

protect, other relevant market.

Procedure for Filing Information with CCI Regarding Anti-Competitive Agreements and Abuse of Dominant Position

Who can file information? [Section 19]

i. Any person(individual, HUF, firm, company, local authority, cooperative or any artificial juridical person);

ii. Consumer or trade association(s); oriii. Reference by Central/ State Govt. or Statutory authority

What information can be filed?

i. Anti-competitive agreements [Section 3(1)];ii. Abuse of dominant position [Section 4]; or

iii. Own knowledge of the Combination or from the information relating to the acquisition referred to in section 5 of the Act about a combination which causes or is likely to cause an AAEC in the markets in India [Section 6].

How to file information/reference before the Competition Commission?[Regulation 10 of the CCI (General) Regulations, 2009]

The information should contain following details:

i. Legal name of the person/enterprise giving information or reference.

ii. Complete postal address with PIN code, telephone number, fax number and E-Mail address.

iii. Mode of service through which summon or notice from

the CCI is preferred.iv. Mention the legal name and address of the enterprise

alleged to have contravened the provisions of the Act.v. Legal name and address(es) of the authorized

counsel/representative, if any.The following should be included in the information/ reference:

i. Statement of facts;ii. Details of the alleged contraventions of the Act

together with a list enlisting all documents, affidavits and evidence, as the case may be, in support of each of the alleged contraventions.

iii. A succinct narrative in support of the alleged contraventions; and

iv. Relief sought, if any;

Other key points:

The contents of the information/reference shall be duly signed and verified by the person submitting it.(Reg. 10 & 11 of the CCI(General) Regulations, 2009)Information/Reference should be addressed to: The Secretary, Competition Commission of India. The Information may be delivered in person or through registered post/courier services/facsimile transmission/ electronic transmission (duly authenticated with digital signature of the subscriber).Fees to be paid for filing information in case of anti-competitive agreements and abuse of dominant position:[Reg. 49]

In case person filing Information is individual/HUF/NGO/Consumer Association/Co-operative Society/Trust - Rs. 5000

In case of companies/firms having turnover up to Rs. 1 Crore on preceding year- Rs. 20,000

In all other cases- Rs. 50,000In case of defects in information, Secretary, CCI shall notify the same to the parties within 15 days of receiving information. Any defects to be rectified within 30 days of intimation given by Secretary.[Reg. 15]Fees may be paid by tendering D/D or pay order or bankers’ cheque in favour of “Competition Commission of India (Competition Fund)”, New Delhi or by direct remittance in Account No. 1988002100187687 with Punjab National Bank, Bhikaji Cama Place, New Delhi-110066.

10 Copies of the information to be supplied. Additionally a single soft copy of the information (in a Compact Disk) has to be supplied.

Formation of Prima Facie Opinion by CCI

After removing defects, Secretary shall place information before CCI for formation of prima facie opinion on existence of a case.[Reg. 16]

CCI shall endeavour to record its prima facie opinion within 30 days.

Scheme for Enquiry of Matter Referred to Director General (DG-CCI)

Where CCI is of the opinion that a prima facie case exists, it shall direct the DG-CCI to cause an investigation into the matter.

The DG-CCI shall collect relevant data, record statements; afford opportunity for cross-examination of witnesses and to carry out other necessary analysis in the circumstances of the particular case. [Reg. 20 of CCI(General) Regulations, 2009]

The report of the DG-CCI shall contain his findings on each of the allegations made in the information or reference, as the case may be, together with all evidences or documents or statements or analyses collected during the investigation.

The DC-CCI shall submit his investigation report within such time as may be specified by the CCI with reference to the circumstances of a particular case. [Section 26(3) of the Act]. Eight copies of the report shall be submitted to the Secretary, CCI.

Procedure after DG submits enquiry report [Section 26 of the Act and Reg. 21 of CCI (General) Regulations, 2009]

After receipt of Report by DG-CCI, secretary to place report before CCI. He may also forward copies of the same to Central/State Govt. or to the parties concerned, as the case may be.

On receipt of the DG-CCI report, the secretary shall invite objections and suggestions from the parties concerned, as the case may be.

After considering objections of parties, if the CCI finds no contravention of the Act, it may order closure of the matter. The Secretary shall convey the orders of the CCI to the parties concerned.

After considering objections from the parties, if the CCI feels that further enquiry is required in the matter, it shall direct the DG-CCI or any other authorised officer to conduct such further enquiry.

Upon submission of such further enquiry report, the Secretary shall fix meeting of the CCI for consideration of such report.

Orders of CCI [Sections 27, 28 of the Act]

Where the CCI finds contravention of the Sections 3 or 4 of the Act, it may pass the following orders:

Direct the enterprises or persons involved in such abuse of dominant position or anti-competitive agreement to discontinue such abuse of dominant position or discontinue and not to re-enter into such agreement;

Impose a penalty not more than 10% of the average turnover of last three preceding years upon each of such person or enterprises which are parties to such agreements or abuse.

In case of the anti-competitive agreement having been entered into by a cartel, the penalty may go up to three times of its profits for each year of continuance of such an agreement or 10 % of its turnover for each year of continuance of such an agreement whichever is higher.

Modify the anti-competitive agreement to the extent specified in the order; Any other directions, including payment of costs.

In addition to the CCI finding contravention and passing the above orders, the CCI may, by an order in writing, notwithstanding else contained in the Act,

Divide the enterprise so as to ensure that such an enterprise does not abuse its dominant position ;( Section 28) OR

Regulation of Combinations [Sections 5 & 6 of the Act]

Acquisitions, amalgamations, mergers, etc. are some of the ways for inorganic ang faster ways of growth in size as well as increasing market dominance. The Act puts an oversight review mechanism in place for exercising control over such mergers and acquisitions, with a view to ensure that outcomes of such amalgamations and mergers are not anti-competitive. However it should be noted that not all combinations are subject to approval by CCI.

As mentioned above, certain thresholds exist for a merger to seek mandatory approval of CCI-

(i)Threshold for Combinations by single enterprises-: An acquisition/acquiring of control/merger is considered combination if the parties to the acquisition, being the acquirer and the enterprise acquired or being acquired have:

o In India: Assets of value of more than Rs. 1,500 Crores; or turnover of more than Rs. 4,500 Crore; or

o In India or Outside India: Assets of aggregate value of more than $US 750 Mn., including at least Rs. 750 Crores in India; or turnover of more than $US 2,250 Mn., including at least Rs. 2,250 Crore in India

(ii)Threshold for Group Combinations-: A group acquisition is considered combination if the group to which the combining parties shall (post-merger) belong have:

o In India: Assets of value of more than Rs. 6,000 Crores; or turnover of more than Rs. 18,000 Crore; OR

o In India or Outside India: Assets of aggregate value of more than $US 3 Bn., including at least Rs. 750 Crores in India; or turnover of more than $US 9 Bn., including at least Rs. 2,250 Crores in India.

Indicative table of thresholds for Combinations under Competition Act, 2002

Operations of Combining Parties

Combining Parties Group to which Combining Parties (post merger) belong

India Total value of assets >

Rs.1500/-crores or turnover Rs.4500/- crores.

Total value of assets of more than Rs.6000/- crores or turnover of more than Rs.18000/- crores

India or Outside

Aggregate value of assets >

$750 mn (including at least in India Rs.750 crores or turnover > $2250 mn (incldg. at least turnover of Rs.2250 crores in India).

Aggregate value of assets of more than $3 bn (including at least assets of Rs.750 crores in India) or turnover of $9 bn (including Rs.2250 crores turnover in India.)

Exemption from Approval of Combination by CCI: Share subscription or financing facility or any acquisition, by a public financial institution, foreign institutional investor, bank or venture capital fund, pursuant to any covenant of a loan agreement or investment agreement.

Detailed Procedure for notifying combinations is given in Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011.

Notice of Combinations to CCI: Persons or enterprises, before entering into combinations, shall give notice to CCI within 30 days of approval of merger or amalgamation by Board of Directors or execution of any agreement of acquisition by the enterprises.

o The notice of such combination shall ordinarily be filed in Form-I as provided in Schedule-II of the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011.

o The notice of such combination may also be filed in Form-II as provided in Schedule-II if the parties to the combination are engaged in business of similar goods and shall control more than 15% of the market post-combination; OR if the parties are at different levels of production chain and individually or jointly control more than 25% of the relevant market at present.

o Where the information has been submitted in Form-I, but the CCI requires information in Form-II, it shall ask the parties to submit information in Form-II.

o Details of acquisition by PFI, FII, VCF, pursuant to a loan or investment agreement shall be filed in Form-III as provided in Schedule-II, along with certified copy of loan or investment agreement. Such Form-III has to be filed within 7 days from the date of acquisition.

Fees for Filing Notice of Combination: The fees, as mentioned below, may be paid jointly or severally by the parties to the combination:

o Fees for Form-I- Rs. 10,00,000 (Rs. Ten lakhs only)o Fees for Form-II- Rs. 40,00,000 (Rs. Forty lakhs only)

Procedure for filing notice of Combinations:

o Notice of combination to be filed in duly filled and verified Form (as specified above) along with two copies and an electronic version thereof with the CCI.

o A summary of the Combination briefly describing relevant aspects of the combination.

o The above summary to be separately given with notice Forms along with nine copies and an electronic version thereof.

Inquiry by CCI into Combinations:

o CCI on the basis of its prima-facie opinion that the combination is likely to have adverse affect on competition in India can issue show cause notice to parties to conduct inquiry of proposed combination. The parties in such event need to reply within 30 days of receiving such notice.

o After receiving response from parties, the CCI may call for a report from DG-CCI within specified time period.

o Thereafter, if CCI , prima-facie , opines that the combination is likely to have an AAEC, it can ask parties to publish the details of the combination in public domain within 10 working days to bring the combination in public knowledge.

o Written objections from the public may be called for within 15 working days from the publication of details of such combination.

o CCI may then proceed with the case after receipt of all information and pass such orders as it deems fit.

Time Limit for CCI to pass orders relating to Combinations:o The CCI has to pass order within 210 days of receiving notice of

combination. Failing so, the combination shall be deemed to be approved by the CCI.

o For the purpose of limitation, the period of receiving objections and modified combination from the parties is excluded. [The Government however is seeking to bring down this period to 180 days. The 2012 Amendment Bill seeking to bring relevant amendment to the Competition Act is currently pending before the Parliament. ]

Orders of CCI [Sections 31 of the Act]

Where the CCI finds a contravention of Section 6 of the Act, it may pass the following orders:

o Combination may get an approval where no AAEC in relevant market is anticipated.

o Where a combination is anticipated to have an AAEC in relevant market, it may either be disallowed, or ordered to be modified to the extent that all/ any adverse effect is eliminated.

During pendency of any proceeding/inquiry before CCI, it is empowered to issue interim orders till the disposal of such enquiry or until further orders. [Section 33 of the Act]

CCI is also empowered to modify its order for mistakes apparent on record (without amending substantive part) upon its own notice or on an application by one of the parties. [Section 38 of the Act]

Penalties Which Can Be Imposed by CCI

CCI may impose the following penalties:

For anti-competitive agreements and abuse of dominant position-o Up to 10% of the average turnover of last three preceding financial years

upon each enterprises or persons which are parties to agreement or abuse. [Section 27 of the Act]

o In case of Cartels, CCI may impose penalty of three times the profit of each year of continuance of cartel upon each member of such cartel OR up to 10% of the average turnover of last three preceding financial years upon each member of cartel, whichever is higher. However, CCI may impose lesser penalty on any member of the cartel who co-operates and makes full disclosure in respect of alleged violation before submission of report by DG-CCI. [Section 27 of the Act]

For non-furnishing of information relating to Combinations-o CCI can impose penalty of 1% of turnover or assets of combination,

whichever is higher, for not notifying about the same to the CCI. [Section 43A of the Act]

o If any party to a combination makes a false statement or omits material fact about the combination to CCI, a penalty of Rs. 50 lakh to Rs. 1 Crore may be imposed by CCI upon such person. [Section 44 of the Act]

No penalty shall be imposed by CCI unless the party against whom the penalty is imposed has been given a show cause notice and a reasonable opportunity (of at least 15 days) of being heard. [Reg. 48 of the CCI (General Regulations, 2009].

RECOVERY OF MONETARY PENALTY BY CCI

CCI can recover monetary penalty as arrears of income tax and may make a reference to the concerned income tax authority to do so. [Section 39 of the Act].

CCI can also recover monetary penalty on its own according to the procedure provided in the CCI (Manner of Recovery of Monetary Penalty) Regulations, 2011.

Contraventions of Orders of CCI: Penalties & Claim for Compensation

Any person not complying with the orders of CCI may be punishable with fine which may extend to rupees one lakh for each day during which such non-compliance occurs, subject to a max. of Rs. 10 Crore, as the CCI may determine.

Further non-compliance may be punishable with imprisonment upto three years and/or fine of Rs. 25 Crore, as the Chief Metropolitan Magistrate, Delhi may deem fit on complaint by CCI. [Section 42 of the Act].

In case of any contravention by companies, every officer in charge of the company, and also the company itself, shall be deemed guilty of such contravention and shall be proved against accordingly. [Section 48 of the Act]

Claim for Compensation from CCI or COMPAT Orders- It should be noted that CCI has no power to grant compensation in its orders. Initially, such power was available to CCI u/s 34 of the Act, but the same was omitted subsequently in amendments of 2007.

Any compensation arising directly from the contravention of Section 3, 4, 5 or 6 of the Act- as per finding of CCI of COMPAT orders- may be claimed through an application to COMPAT (through such procedure as described later). [Section 53N of the Act]

Compensation for non-compliance of CCI-orders: Any person aggrieved may make application before COMPAT for compensation for any loss suffered as a result of non-compliance or contravention of CCI orders. [Section 42A of the Act]

Compensation for non-compliance of COMPAT-orders: Any person may make application before COMPAT for compensation for any loss suffered as a result of non-compliance or contravention of COMPAT orders. [Section 53Q of the Act]

Appeal to Competition Appellate Tribunal (COMPAT) - [Section 53B of the Act]

Appeals, in five copies, against the orders of the CCI or application for claim of compensation for any loss due to non-compliance of CCI orders may be made to COMPAT within 60 days of communication of order to the parties. However, appeal may be allowed after sixty days, if sufficient cause is shown.

Form for filing Appeal and application for compensation to COMPAT: The memorandum and fee for the same has been provided as annexure to COMPAT(Form and fee for filing an appeal and fee for filing compensation applications) Rules, 2009.[Reg. 3 of these Regulations]

Procedure for Appeal: Detailed procedure for Appeal to COMPAT is given in COMPAT (Procedure) Regulations, 2011.

o Every appeal shall be accompanied by an affidavit and a certified copy of the impugned order and shall be registered by the Registrar-COMPAT after verification.

o After hearing the appellant, the COMPAT may either dismiss the appeal or issue notices to all necessary parties.

o All documents before the COMPAT, including pleadings, shall be accompanied by 04 copies thereof for COMPAT’s record and such additional copies for each of the respondents.

o After giving the parties and opportunity of being heard, the COMPAT may pass such orders as it deems fit.

Fees for filing Appeal to COMPAT-[Reg. 4 of the COMPAT(Form and fee for filing an appeal and fee for filing compensation applications) Rules, 2009]- Following Fees has to be paid for filing appeals with COMPAT:

o If penalty imposed by CCI is less than Rs. 20,000- Rs. 1,000 feeo If penalty imposed by CCI is between Rs. 20,000 to Rs. 1,00,000- Rs. 2,500

feeo In all other cases- Rs.2,500 fee plus Rs.1,000 for every additional one lakh of

penalty or fraction thereof, subject to a maximum of Rs.3,00,000

Fees for filing Application for Compensation to COMPAT-[Reg. 4 of the COMPAT(Form and fee for filing an appeal and fee for filing compensation applications) Rules, 2009]- Following Fees has to be paid for filing application for recovery of compensation with COMPAT:

o If compensation claimed is less than Rs. 1,00,000- Rs. 1,000 feeo If compensation claimed is more than Rs. 1, 00, 000- Rs. 1,000 fee plus

Rs.1,000 for every additional one lakh of penalty or fraction thereof, subject to a maximum of Rs.3,00,000.

The COMPAT shall endeavour to dispose-off appeals within 6 months of the receipt. [Section 53B of the Act]

Appeal before the Supreme Court:

Appeals against any order or decision of COMPAT may be made to Supreme Court within 60 days of communication of order to the parties. However, appeal may be allowed after sixty days, if sufficient cause is shown. [Section 53T of the Act]

Glossary/ Important Terms:

Agreement: Agreement includes any arrangement or understanding or action in concert, whether or not, such arrangement, understanding or action is formal or in writing; or whether or not such arrangement, understanding or action is intended to be enforceable by legal proceedings;

Bid-Rigging: Any agreement, between enterprises or persons engaged in identical or similar production or trading of goods or provision of services, which has the effect of eliminating or reducing competition for bids or adversely affecting or manipulating the process for bidding

Cartel: Cartel includes an association of producers, sellers, distributors, traders or service providers who, by agreement amongst themselves, limit, control, or attempt to control the production, distribution, sale or price of, or, trade in goods or provision of services;

CCI: Competition Commission of India COMPAT: Competition Appellate Tribunal- The appellate court for appeals against

orders of CCI. Consumer: Consumer means any person who buys any goods for a consideration

which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, whether such purchase of goods is for resale or for any commercial purpose or for personal use; hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of

deferred payment, when such services are availed of with the approval of the first-mentioned person whether such hiring or availing of services is for any commercial purpose or for personal use.

DG :Director General Enterprise: Enterprise means a person or a department of the Government, who

or which is, or has been, engaged in any activity, relating to the production, storage, supply, distribution, acquisition or control of articles or goods, or the provision of services, of any kind, or in investment, or in the business of acquiring, holding, underwriting or dealing with shares, debentures or other securities of any other body corporate, either directly or through one or more of its units or divisions or subsidiaries, whether such unit or division or subsidiary is located at the same place where the enterprise is located or at a different place or at different places, but does not include any activity of the Government relatable to the sovereign functions of the Government including all activities carried on by the departments of the Central Government dealing with atomic energy, currency, defence and space.

Predatory Pricing- The sale of goods or provision of services, at a Price which is below the cost, as may be determined by regulations, of production of the goods or provision of services, with a view to reduce competition or eliminate the competitors.

Price: Price in relation to the sale of any goods or to the performance of any services, includes every valuable consideration, whether direct or indirect, or deferred, and includes any consideration which in effect relates to the sale of any goods or to the performance of any services although ostensibly relating to any other matter or thing.

Relevant Geographic Market: It is the area in which the conditions of competition for supply of goods or provision of services or demand of goods or services are similar and can be distinguished from the conditions prevailing in the neighbouring areas.

Relevant Market: It is the market which may be determined by the CCI with reference to the relevant product market or the relevant geographic market or with reference to both the markets.

Relevant Product Market: It is the market comprising all those products or services which are regarded as identical/similar by the consumer, by reason of characteristics of the products or services, their prices and intended use.

Service: Service means service of any description which is made available to potential users and includes the provision of services in connection with business of any industrial or commercial matters such as banking, communication, education, financing, insurance, chit funds, real estate, transport, storage, material treatment, processing, supply of electrical or other energy, boarding, lodging,

entertainment, amusement, construction, repair, conveying of news or information and advertising.

Trade: Trade means any trade, business, industry, profession or occupation relating to the production, supply, distribution, storage or control of goods and includes the provision of any services.