India – CCI Issues Guidelines Concerning Competition Assessment Of Legislations and Policies

27 July, 2016

 

Pursuant to its goal of ensuring healthy competition in the market, Competition Commission of India (‘CCI’) has decided to set up a panel of 5-7 institutions to carry out an initial competition assessment of economic legislations per the CCI (Competition Assessment of Economic Legislations and Policies) Guidelines, 2016 (‘Guidelines’). With the Guidelines, CCI is looking to facilitate transparent assessment of – (i) select economic legislations enacted by the Parliament or State Legislatures; and (ii) economic bills pending or coming up before them in the near future, from a competition perspective.

 

The Guidelines state that one of three resources would be considered for identifying legis- lations/polices for such an assessment, namely: (i) the Advocacy Division of the CCI; or (ii) any Government agency; or (iii) CCI itself.

 

The assessment will help to identify if any of the provisions of a legislation/policy could: (i) cause an appreciable adverse effect on competition (‘AAEC’) in the relevant market in India; (ii) humble any of the salient features of a competitive market; (iii) restrict the freedom of players in the market and choices of consumers; and (iv) be in disharmony with the objectives of the Competition Act, 2002 (‘Act’)

 

The assessment would take into account the factors listed in Sections 19(3),(4) and 20(4) of the Act. In case the assessment finds issues related to competition in a particular legislation, then CCI will suggest necessary modifications to be made to the relevant stakeholders. The Guidelines will become effective from January 1, 2017. Globally, many jurisdictions, such as Australia, have similar programmes to evaluate existing and upcoming economic legislations from the perspective of competition law.