Compensation likely in settlement cases in revised Competition Bill

Legislation likely to be introduced in ongoing Budget session of parliament

The government, in changes being introduced to a Bill, is considering allowing compensation to be claimed even in settlement cases, said sources. The addition to the settlement clause is being made to protect consumers, a senior official said.

The final Competition Amendment Bill, however, will keep cartels out of the settlement provision, sources said. A parliament standing committee, in its report on the Bill, had suggested that cartels be allowed to participate in a settlement arrangement as a pragmatic recourse.

The government is also likely to take away any immunity to internal legal advisors from examination on oath by the director general of Competition Commission of India (CCI).

Changes to the Bill are likely to be introduced in the ongoing Budget session of parliament. One change is in the definition of 'turnover' for the purpose of penalties, as 'global turnover' derived from all the products and services by a person or an enterprise.

The government has rejected several suggestions made by the parliament committee for changes in the Bill, including that for increasing the proposed time-limit of 150 days for the approval of the merger applications. It has, however, increased the time-limit of prima-facie investigation for the merger deal from proposed 20 days to 30 days.

The standing committee had recommended against shortening merger review timelines, saying it can be burdensome for an understaffed CCI,

The government has also not agreed to bring an effects-based analysis for assessing abuse of dominance or to allow intellectual property rights as a defence in the competition law.

The standing committee had said that the ministry of corporate affairs had not put up any strong argument as to why intellectual property rights (IPR) cannot be used as a defence against abuse of dominant position. It said, “... it would be more desirable for CCI to specifically take into consideration the rights that a party may have in relation to reasonable exercise of its IPR when dealing with abuse of dominance cases to avoid uncertainty.”