The Corporate Affairs Ministry (MCA) is now gearing up to implement the various provisions of the recently-enacted Competition (amendment) Act 2023 in a staggered manner at different periods of time. 

All the recent amendments will not be implemented at one go and the MCA will adopt a “staggered” approach to its implementation, sources said. This would mean that different dates would be notified for the implementation of different provisions, they added. The first set of implementation dates are set to be soon announced, sources noted.

Comprehensive change

Implementation date is crucial as the Competition Commission of India (CCI) would have to frame regulations for the new features introduced in the recent amendment law. 

The Competition (amendment) Act 2023 is significant as it is the most comprehensive change undertaken since the enactment of the Competition law in 2002.

The amendment is expected to considerably strengthen the market watchdog, CCI and it is hoped that these changes will “future proof” the law, to deal with a rapidly growing and changing economy.

While the Competition (amendment) Bill 2022 was introduced in the Lok Sabha on August 5 last year, it got Parliament approval in April this year after the assent of President Droupadi Murmu on April 11. 

While Rajya Sabha gave its nod on April 3, this amendment Bill was passed by Lok Sabha on March 29 this year after Finance Minister Nirmala Sitharaman moved nearly 13 amendments in the Lower House.

The Government had in 2018 constituted a Competition Law Review Committee to review the Competition Act 2002 to ensure that the legislation is in sync with the changing business environment.

The CCI was set up in 2009 and since its inception the Indian economy has grown leaps and bounds into a $ 3.5 trillion economy now.

Major provisions

Introduction of “global turnover” as a benchmark for levy of penalties arising from any abuse of dominant position by enterprises is one of the salient features of the amended law. 

Other noteworthy features are introduction of a Settlement and Commitment Framework to ensure faster market correction; introduction of concept of Deal Value Threshold for notifying mergers and acquisitions (M&As) to address killer acquisitions in digital market and introduction of “leniency plus” regime. 

Industry is keenly awaiting the proposed settlement and commitment framework introduced by the Amendment Act. India Inc wants to get clarity on whether the regulator would insist on ‘admission of guilt’ by the applicants to get the benefits of the new dispensation as there is no clarity in the law on this aspect.

For deal value threshold, industry is keenly watching on how the nexus with India aspect would be proved. 

The leniency plus regime is a new cartel detecting tool that would encourage companies already under investigation for one cartel to report other cartels unknown to the competition regulator.

Besides reducing the timelines for M&A clearances (from 210 days to 150 days), the revised law provides for appointment of Director General (Investigation) by the CCI. So far, the Centre has been appointing the DG (Investigation).

Another significant change relates to 25 per cent deposit of penalty for appeals. The new law also provides for inclusion of facilitators of certain anti-competitive agreements within the framework of law (hub—and—spoke).

Related Topics