Transcript Competition Law and Competition Policy

 Building

“Friends of Competition”
in India
Competition Law and Competition Policy

A presentation by Dhanendra Kumar
Chairman, Committee for National Competition Policy
New Delhi, 24th November 2011
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Scheme of Presentation

Economic Reforms & Competition Regime

Benefits of Competition

The Competition Act, 2002

National Competition Policy

Going Forward
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
1991 – heralded unshackling of Indian Economy,
unleashing competitive spirit of Indian entrepreneurs,
raising growth

A series of reforms ensued-in trade, industry,
licensing, monetary and fiscal policies, etc

Competition Act 2002 – however, enforcement
commenced in May 2009

Reforms – a continuing process – still on

Now National Competition Policy on anvil.
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
Competition Act – lays the legal framework,
Competition Commission to enforce it.
 Competition Commission of India - fully
functional with enforcement, in May 2009
 Section 3 (agreements) and 4 (abuse of
dominance) notified in May 2009
 Section 5 and 6 (mergers and acquisitions)
notified in March 2011, effective 1st June 2011,
and Regulations after consultations also notified.
 CCI also undertakes Competition Advocacy
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Competition Ushers Static and Dynamic Efficiency
Enhanced
productivity,
Innovation
Competi
tion
Laws
and
Policy
Competitive
Markets
Wider Choice,
Better Quality,
Lower Prices of
products/servces
Higher
Economic
Growth
Higher
Purchasing
Power
Fruits of
Growth reach
the Aam
Admi
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CONSUMERS
BUSINESSES
GOVERNMENTS
• Wider choice of goods, services and
suppliers
• Better quality and improved value
• Reduced Costs
• Level playing field; redressal against anticompetitive practices
• Competitively priced inputs
• Greater productivity and ability to compete
in global markets
• Optimal realization from sale of assets
• Savings of public money in procurement
• Enhanced availability of resources for social
sector development
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
Competition Policy – an overarching policy
framework to infuse competition principles
across Government measures, statutes etc.
 More positive and proactive
 Relatable more to Govt. Departments/ PSUs,
encourages them to adopt competition principles,
correct policies with anti-competitive outcomes.
 Committee on National Competition Policy
 Report submitted to Govt, after consultations
with stakeholders- now under process
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


Competition Policy means an overarching set
of Government policies,measures,statutes
and regulations, including a Competition Law,
aimed at promoting competitive market
structure in economy
As Raghavan Committee observed
“Competition Law must emerge out of a
National Competition Policy”
While Law enacted, Policy under formulation.
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◦ Promote competition - optimize efficiency – review government
policies to check anti-competitive outcomes
◦ Promote economic democracy, restrict rent seeking practices,
efficiency in public procurements
◦ Strive for development of markets, and a single national market as
fragmented markets impede competition
◦ Ensure wider choices and better quality of goods and services
◦ Synergized relationship among sectoral regulators and/or CCI
and prevent jurisdictional grid-locks
◦ Build strong competition culture amongst stakeholders - public
officials, business, trade associations, consumers associations.
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
Review all existing and new Acts/ regulations/ policies,
correct where anti-competitive outcomes noticed, and
proactively promote competition principles.

Separate policy making, regulations and operations

Competitive neutrality and level playing field

Third party access to ‘essential facilities’


Create institutional mechanism for coordination among CCI
and sectoral regulators, tweak Acts, where needed.
Work towards promotion of competition in market place, and
development of a single national market
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◦ The draft NCP is under active consideration of the
Govt, consultations with State Govts is on.
Thereafter, may be taken to the Cabinet.
◦ Meanwhile, a series of reforms are on, or under
process in various Ministries - common thread of
promoting competition running through them:∙ Interests rates – RBI allowed banks to fix
their saving interest rates, in Oct 2011
∙ UID to all citizens- enhanced efficiency and
transparency in distribution of subsidy
∙ National Manufacturing Policy notified in Oct
2011 – will generate 100 million jobs
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∙ Drafts of National Telecom Policy
2011, National Policy on Information
Technology 2011 & National Policy
on Electronics unveiled for
consultation.
∙ Companies Bill- likely to be
introduced soon
∙ FDI in multi-brand retail sectorunder consideration
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∙ Real Estate- Draft Real Estate (Regulation &
Development) Bill, 2011- consideration
∙ Land Acquisition Bill- consideration
∙ Public Procurement Law- consideration
∙ FDI in Civil Aviation sector- consideration
∙ Direct Taxation- Bill introduced in 2010with Standing Committee
∙ Indirect Taxation- Constitution Amendment
Bill introduced- uniform tax structure- GST
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

National Competition Policy, when adopted
will usher in the second wave of reforms, as it
envisages review of all existing and proposed
statutes, regulations, policies and procedures
to usher in greater competition and promote
markets and choices for consumers
In other countries, like in Australia, Mexico
and elsewhere, it boosted National GDP. Can
help in bringing down prices, controlling
inflation and creation of jobs.
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Thank you
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