{"id":226562,"date":"2023-02-14T19:42:04","date_gmt":"2023-02-14T14:12:04","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=226562"},"modified":"2023-02-20T13:11:42","modified_gmt":"2023-02-20T07:41:42","slug":"competition-law-amendments-of-penalties-and-misses","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/competition-law-amendments-of-penalties-and-misses\/","title":{"rendered":"Competition law amendments: Of penalties and misses"},"content":{"rendered":"\n


\nSource<\/strong>: The post is based on an article\u00a0\u201c<\/strong>Competition law amendments: Of penalties and misses<\/strong>\u201d <\/strong>published in Live Mint<\/strong> on\u00a014th <\/sup>February 2023<\/strong>.<\/p>\n

Syllabus: GS 2 \u2013 Governance<\/strong><\/p>\n

Relevance: <\/strong>proposed amendments in <\/strong>Competition Amendment Bill 2023<\/p>\n

News<\/strong>: The government has come up with the proposed amendments to India\u2019s competition law and is set to introduce the Competition Amendment Bill<\/strong> (2023) in Parliament.<\/p>\n

What are the proposed amendments in the bill and what are the associated concerns?<\/strong><\/h2>\n

Change in the imposition of penalties:<\/strong> The bill proposes that the Competition Commission of India (CCI<\/strong>) can now impose penalties up to 10% of the total global turnover of enterprises<\/strong> which are found to have contravened the competition law.<\/p>\n

Currently, penalties are calculated as a percentage of only relevant turnover in India<\/strong>, which excludes sales from products which have no relation to the contravention.<\/p>\n

Further, the current law uses the word \u2018turnover\u2019<\/strong> in the penalty provision and does not specify if it is \u2018total\u2019 or \u2018relevant\u2019.<\/p>\n

However, in 2017, the Supreme Court<\/strong> had clarified that turnover for imposing penalty should mean relevant turnover.<\/strong><\/p>\n

The court has also held that when the contravention involves one product, there is no need for including other products for imposing a penalty.<\/p>\n

The government has also retained a provision that required the CCI<\/strong> to come out with regulations to \u2018determine\u2019 the turnover to be considered for penalties.<\/p>\n

Hence, the concern with global turnover for calculating penalties is that it might impose heavy penalties on big multinational companies.<\/strong><\/p>\n

Expansion of the scope of liability of cartel facilitators:<\/strong> The amendment has proposed to codify the liability of cartel facilitators which \u2018actively participate\u2019 in the advancement of a cartel.<\/strong><\/p>\n

However, the parliamentary panel recommended that the scope of this proposal must be limited<\/strong> and the CCI must first prove<\/strong> that a facilitator intended to actively participate in a cartel.<\/p>\n

But, the 2023 Bill has expanded its scope by removing the word \u2018active\u2019<\/strong>. Hence, this might have a negative impact on those entities which may not have in fact participated, but may have only intended to participate in a cartel.<\/p>\n

Therefore, a broad provision like this raises over-enforcement risks<\/strong> and may expose certain entities to undue hardship.<\/p>\n

What is another concern with the Bill?<\/strong><\/h2>\n

The bill has excluded cartels from the proposed settlement regime<\/strong> because there already exists a leniency regime for them.<\/p>\n

However, leniency and settlement regimes are designed to secure efficiencies<\/strong> at different stages of a CCI inquiry, and they co-exist in other countries as well. Therefore, the exclusion of cartel settlements seems like a missed opportunity.<\/p>\n","protected":false},"excerpt":{"rendered":"

Source: The post is based on an article\u00a0\u201cCompetition law amendments: Of penalties and misses\u201d published in Live Mint on\u00a014th February 2023. Syllabus: GS 2 \u2013 Governance Relevance: proposed amendments in Competition Amendment Bill 2023 News: The government has come up with the proposed amendments to India\u2019s competition law and is set to introduce the Competition… Continue reading Competition law amendments: Of penalties and misses<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[212,10501],"class_list":["post-226562","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-2","tag-live-mint","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704799588},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/226562","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=226562"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/226562\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=226562"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=226562"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=226562"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}