Competition Law

[By Yatendra Singh] The author is a student of Dr Ram Manohar Lohia National Law University, Lucknow.   ​​​Introduction  ​​In the complex landscape of competition law, uncovering and prosecuting cartels remains a formidable challenge worldwide. India’s recent introduction of the Competition Commission of India (Lesser Penalty) Regulations, 2024 marks a significant stride towards enhancing antitrust enforcement. This article explores how these regulations incentivise cartel disclosure through leniency provisions akin to global standards, aiming to strengthen fair market practices. By examining the impact and nuances of these measures, this discussion underscores their pivotal role in shaping India’s competitive economic environment.​  For instance, cartelisation is not a new phenomenon. In the 1800s, powerful trusts like the Standard Oil Company had ​​monopolized crucial sectors in the United States, controlling prices and stifling competition. The unchecked power of these trusts led to market disruption, escalating prices, and compromising consumer welfare. In response, the US enacted its first Competition Act, the Sherman Antitrust Act, in 1890 to address these abuses, signalling the need for anti-trust legislation to curb monopolistic practices and safeguard economic and consumer interests.  ​​​While these laws are good for regulating the market and punishing those who break it, ​however​, they are not sufficient to unearth hidden Cartels. In fact, India’s first Anti-trust Act (Monopolies and Restrictive Trade Practices Act 1969) was replaced because it became redundant after India’s new economic policy in 1991 and the globalisation of the market. Cartels, by their nature, are hidden and secret. Cartel cases are difficult to investigate and detect because of the scope and complexity of many cartels. The conspiracy can be established through both direct and indirect means. ​​Often, only the participants know exactly how the cartel works. According to MIT economist Alexander Wolitzky, participants typically become aware of cartel activities through various channels, including industry conferences, informal networks among competitors and conventional wisdom.  Therefore, the Competition (Amendment) Act 2002 and new regulations in the leniency scheme, namely The Competition Commission of India (Lesser Penalty) Regulations, 2024, become important. This new amendment aims to unearth hidden cartels by offering an additional reduction in monetary penalty. It will be interesting to see how these new regulations play out in a market that operates through digital platforms, where detecting cartels becomes even more challenging.  ​​Cartels​  Cartels are defined under section 2 of the Competition Act as an association of producers, sellers, distributors, traders, or service providers who, by agreement amongst themselves, limit, control, or attempt to control the production, distribution, sale, or price of, or trade in goods or provision of services. A cartel is usually understood to be formed by a group of sellers or buyers who bond together and try to eliminate competition. Supreme Court defined cartels in ​​Union of India vs Hindustan Corporation Limited as an association of producers who, by agreement among themselves, attempt to control the production, sale, and price of the product to obtain a monopoly in any particular industry or commodity.   Cartelisation is a type of horizontal agreement that shall be presumed to have an appreciable adverse effect on competition under Section 3 of the Act. Horizontal agreement refers to an agreement between two or more parties that are at the same stage of production and on a similar line of production. ​​It is presumed to affect the consumer market adversely, such as inflated prices and reduced choices for cheaper alternatives. This was highlighted in Neeraj Malhotra v. North Delhi Power Ltd, where electricity distribution companies restricted consumer choices by distributing faulty meters, adversely affecting the market by inflating bills, limiting competition, and enabling price manipulation through cartel-like behaviour.  Horizontal agreements are, by their very nature, prohibited by law. In case there is an application of cartelisation against the enterprise, the enterprise has to prove its innocence. Additionally, the Competition Act empowers the CCI to impose penalties and/or fines on the detection of cartels under Section 27 of the Act.   In ​​Express Industry Council of India v Jet Airways (India) Ltd, the Competition Commission of India (CCI) found a cartel involving airlines, including Jet Airways, IndiGo, and SpiceJet, collaborating to fix Fuel Surcharge rates in the air transportation sector. CCI imposed penalties on Jet Airways (Rs. 39.81 crore), IndiGo (Rs. 9.45 crore), and SpiceJet (Rs. 5.10 crore) for overcharging cargo freight under the guise of a fuel surcharge. This action was deemed to violate Section 3(1) read with Section 3(3)(a) of the Competition Act, addressing anticompetitive practices and safeguarding consumer interests. In light of the above case, it is clear that once found guilty of cartelization, Enterprises have to pay a heavy penalty. However, the Competition Act also has a whistle-blower provision that could reduce these penalties up to 100%.   ​​Leniency Provision​  Section 46 of the act deals with the leniency provision. This provision can grant leniency by levying a lesser penalty on a cartel member who provides full, true, and vital information regarding the cartel. The scheme is designed to induce members to help detect and investigate cartels. This scheme is grounded on the premise that successful prosecution of cartels requires evidence supplied by a member of the cartel. ​​Leniency schemes have proved very helpful to competition authorities of foreign jurisdictions in successfully proceeding against cartels. For Instance, The US corporate leniency program has been very successful. Previously, the Department of Justice received about one amnesty application per year. With the introduction of the new policy, however, this rate has surged to approximately two applications per month. Notably, amnesty awards have been pivotal in several prominent cases, such as the Vitamins investigation, where the applicant received a substantial fine reduction totalling nearly $200 million.  Similarly, In India, In Anticompetitive Conduct in the ​​Dry-Cell Batteries Market in India Vs Panasonic Corporation and Others The commission finds that Panasonic Corporation and its representatives provided genuine, full, continuous, and expeditious cooperation during the course of the investigation. Thus, the full and true disclosure of information and evidence and continuous cooperation provided not only enabled the Commission to order an investigation into

[By Dhananjay Dubey] The author is a student of Institute of Law Nirma University, Ahmedabad.   Introduction  A Non-Compete Agreement is a legally enforceable agreement in which the “Restricted Party” agrees not to participate in any competitive activities during and for a set period after the termination of their commercial relationship with the “Protected Party.” It is a common tool used by businesses to retain valued employees, protect secret information and customers, and prevent unfair competing activities. Employment terminations, contractor or consultant engagements, corporate partnerships, and mergers or acquisitions are all scenarios that use non-compete agreements. In exchange for accepting the constraints, the Restricted Party must be given consideration, such as job offers or monetary recompense. The Agreement prohibits the publication of confidential information, even after the termination of employment.  FTC’s Ban on Non-Compete Agreements: A Shift in Competition Law  Recently in the month of January 2024, the (Federal Trade Commission) FTC issued a rule to ban non-compete agreements to protect competition across the country. On 23rd April 2024, the proposed rule came into effect after much deliberation. The said rule bans all types of non-compete agreements as violative of Section 5 of the FTC Act which prohibits unfair or deceptive practices affecting commerce. The framework of the rule is broad, prohibiting not only non-compete agreements but also other parallel arrangements that serve similar goals. This rule applies to any agreement that prevents or penalizes employees from exploring opportunities with competing companies.  Under the final regulation, new non-compete agreements for top executives earning more than $151,164 per year and holding major policymaking roles, such as presidents or CEOs, are forbidden, although existing agreements are still lawful. This differs significantly from the proposed regulation, particularly in terms of the treatment of existing agreements and notice obligations. Existing non-compete agreements do not require a formal termination. Firms must notify non-senior executive staff with existing agreements that they will no longer be enforceable once the law is implemented, allowing them to pursue other alternatives. The FTC provides a sample notice for clarity and uniformity, emphasizing employees’ ability to pursue their professional goals unrestricted.  Exception to the Final Rule  Exceptions to the rule exist for certain settings and entities. Firstly, non-solicitation and non-disclosure agreements are exempted, although employers should exercise caution as overly restrictive clauses may still breach the law if they unduly limit individuals from working in the same field. Secondly, the rule does not cover in-term non-compete agreements, which restrict competition during employment. Additionally, entities excluded from the FTC Act, like banks and insurance companies, are not bound by the regulation. Franchisee/franchisor contracts are also exempt, though workers of both parties remain protected. Crucially, the final regulation includes an exception for the sale of a business, allowing non-competes in bona fide sales without mandating a minimum ownership stake, as initially proposed. This exception ensures that genuine commercial transactions are not impeded by the rule.  Referenced assessment with Competition Law in India.  This development marks a significant comprehension of competition law in India. The rationale behind proposing such a rule is that it impedes labor mobility and stifles competition, thereby hindering innovation and the establishment of new businesses. The pertinent question here is whether such a development can be anticipated within the Indian Competition law framework. To address this, a brief examination of existing jurisprudence is necessary. Under Indian Law restrictive covenants such as the non-compete clauses fall under the domain of Section 27 of the Indian Contract Act, which asserts that any agreement pursuance of which prevents or restrains a person from practicing a lawful profession, trade, or business is void to that extent, with an exception for the sale and purchase of goodwill. While non-compete agreements seemingly fall within this provision, the Supreme Court, in the landmark case of Niranjan Shankar Golikari v. Century Spinning, scrutinized the validity of such clauses under section 27 of the Indian Contract Act, 1872, which invalidates agreements restraining trade. Justice J.M. Shelat stressed that while restraints on trade are not inherently against public policy, they must be reasonably necessary to safeguard the employer’s interests, placing the burden of proof on the party advocating the contract. The key factor in this case was the reasonability of the non-compete clauses.  It was further held in the case of Larry Lee Maccllister vs. Pangea Legal Database Solutions by CCI that negotiating conditions at the start of employment, including any constraints on future employment, is a standard procedure that does not pose competition problems. Employees consider these conditions when negotiating salary, demonstrating that such agreements are typical employment practices that have little impact on competition. The CCI determined that limits in employment contracts prohibiting employees from joining rivals after termination do not raise competition concerns. Such limitations are regarded as appropriate in preventing trade secret exposure or harm to businesses. Employment contracts are thorough agreements that lay down the rights and duties of both the parties i.e. the employer and the employee. Restrictive covenants such as non-solicitation, non-disclosure, and non-competition agreements are critical for safeguarding employers’ interests and ensuring contractual balance. It was also reasoned that section 3 of the Competition Act addresses service agreements such as exclusive dealing agreements rather than employment issues. The Act’s purpose is to safeguard rights in rem rather than prohibit them in personam. Personam remedies are provided by CCI to individuals but the dependence of the same is through a problem in rem.   Analysis  The inclusion of restrictive covenants in an employment agreement is critical for preserving integrity and efficacy, benefiting both the employer and the employee by establishing defined boundaries. These provisions ensure that rights and duties are understood by both parties. Non-compete agreements, while necessary, do not meet the standards of section 3 of the Competition Act, 2002, which requires a clear delineation of the market that would bear the impact of the adverse appreciable effect created due to the competition concerns arising out of the said employment agreement. In case a defined market is not outlined, on a bare

[By Satyam Mehta] The author is a student of National Law University, Jodhpur.   Introduction Google has effectively blocked third-party cookies for 1% of Chrome users beginning this year, a move that has been delayed multiple times and was announced a couple of years back. However, despite this, the move has met with criticism from different stakeholders alleging that it strengthens Google’s already well-established monopoly. Consequently, Google has come under scrutiny from the UK watchdog Competition and Markets Authority (CMA). This article is an attempt at carefully analysing the paradigm Google is invariably trying to push, its ramifications and if there is a need for further scrutiny from different watchdogs around the world, especially in India.   Ramifications of the move Firstly, it is imperative to understand what third-party cookies are and what is the difference between third-party and first-party cookies. First-party cookies are what are treated as essential cookies by the Data Protection laws and they are vital to the functioning of the site. They are installed by the website you visit to store some important information, for example your language preference or your login information. Therefore, they are significant because they ease  user experience. On the other hand, third-party cookies can be installed by anyone, for example the ad tech companies, for the purpose of tracking the users across websites and profiling them to sell ads. The data can be accessed by anyone by logging into the third-party server code. Thus, third-party cookies are primarily used for tracking the users across websites and profiling them to display relevant advertisements. It is a no-brainer that these are not exactly privacy-centric and leak the users’ data to the ad tech companies that allow them to sell ads as a result of which the ad tech industry has burgeoned into a 600Bn $ a year behemoth. A 2019 GDPR ruling therefore made these cookies optional and mandated explicit consent to be required failing which a fine will be imposed.  Google aims to effectively phase out these cookies by the end of 2024 and follow in the footsteps of its competitors Firefox and Apple’s Safari that blocked these cookies way back in 2019 and 2017 respectively. Google claims that this is a privacy-centric move that will allow users’ data to be safeguarded from multiple stakeholders especially now that the privacy laws landscape is evolving. An obvious question springs then, why is there such rampant criticism of the move and why is Google being investigated for the same when it is just following the footsteps and the mandates of its competitors and watchdogs respectively. For starters, Chrome has 66% market share and while Apple has historically had a closed ecosystem, chunk of Google’s revenue comes from the advertising business. Google has had a monopoly in the ad tech business so much so that it has been sued by the Justice Department with Attorney Generals of various States coming on board. Thus, the paradigm that Google is pushing for has to be seen with a cautious approach from the side of both the users as well as the advertisers. While the majority of users either don’t really understand cookies or do not care whether their ads are relevant or not as long as the tech companies are not intrusive, this is a concern for the ad tech companies as this would change ad targeting dynamics, probably, in Google’s favour.  With the removal of the third-party cookies, the advertisers have to rely on first-party cookies and while Google has this data in abundance, thanks to its various owned and controlled entities such as YouTube, Maps, etc. the small ad tech companies don’t have such enormous amounts of data as they have traditionally relied on third-party cookies for the same. Thus, it will give Google a chance to strengthen its already strong position in the ad tech industry as the websites are not allowed to track users while the browser still logs their information. This doesn’t exactly promote a level-playing field and instead of promoting user privacy, it just makes Google the sole owner of the user data and to do with it as they please. Subsequently, Google promoted their privacy sandbox initiative that it claims will balance the privacy of the users and the needs of the ad tech companies. It is a no-brainer that there needs to be antitrust scrutiny into Google’s actions as what it is effectively doing is stopping the ad tech companies from collecting their own data while making them reliant on the Privacy Sandbox initiative and small ad tech firms will have to enrol to stay relevant because they do not have the enormous amounts of data that Google has as already discussed. There has been an investigation by the UK watchdog CMA that is ongoing and it has gotten Google to make some commitments but no other regulator has batted an eye as they think that the Britts have got it.  Analysis In the opinion of the author there has to be further scrutiny of Google’s actions and motives, especially in the Indian context as its Privacy Sandbox initiative has also been criticised at length but first, it becomes vital to understand the functioning of the Privacy Sandbox initiative. The browser will group people into different sets using different Application Programming Interfaces on the basis of their interests based on their browsing history. The data will never leave the browser and individual user targeting will be minimised as they will be targeted in sets while sharing generic information with the advertisers. However, upon examining this, it becomes apparent that it is disruptive of the level playing field as Chrome has access to user data at the granular level while the advertisers don’t which might allow it to give preferential treatment to its products. Therefore, Google committed to the CMA that it will not use personal user data in its ad system or discriminate in favour of its own products. However, there hasn’t been the same scrutiny by any other

[By Dhanshitha Ravi & Rishabh Guha] The authors are students of Symbiosis Law School, Pune.   INTRODUCTION Interoperability refers to the synergy between different systems to communicate with one another. Users can access multiple complementary services through a single access point. An example of interoperability in our everyday lives is the ability to upload one’s Instagram content on Meta (erstwhile, Facebook). The Draft Digital Competition Bill, 2024 (Bill), released by the Committee on Digital Competition law on 27 February 2024 mandates interoperability of third-party applications by Systemically Significant Digital Enterprises (SSDEs) i.e., Big Tech companies, on their platforms. This coincides with the European Commission’s active role in clamping down on the practices of Tech giants to an extent where Apple was forced to allow sideloading of applications from native websites and third-party app stores. The move seeks to comply with the interoperability mandate of the Digital Markets Act (DMA) that is effective from March 2024.  At this juncture, though mandating interoperability is in vogue, it is not only crucial to decipher where this modern remedy draws its legal foundations from, but also evaluate the same in the context of technological feasibility.   INTEROPERABILITY: A MODERN-DAY APPLICATION OF THE ESSENTIAL FACILITIES DOCTRINE  Concept of Essential Facilities Doctrine (Doctrine)  Briefly, the Doctrine mandates a duty on the monopolist incumbent controlling such essential facilities to ‘share’ such inputs with the competitors. A four-pronged test was devised based on which an input shall be determined as ‘essential’, if the following factors are satisfied –  A monopolist controls the essential facility  A competitor is unable to practically duplicate the essential facility.  The monopolist is refusing the use of the facility to a competitor  Providing the facility is feasible.  Furthermore, the courts also examine whether the facility should be a necessary input in a distinct, vertically related market. Though, traditionally, the doctrine has been applied to infrastructural facilities (such as railway bridges and telecommunications networks, to name a few), however, scholars have urged its applicability to regulate Big Tech.   Warranting application of EFD to regulate Big Tech  To understand whether the Doctrine can be directly applied while regulating Big Tech platforms, it is vital to consider whether it can be deemed as an essential facility and it is not feasible for the competitors to duplicate the same. Only then it is possible to establish a link between interoperability as a remedy in the modern sense to the sharing of facilities that is mandated, once the court opines that the facility is essential.  Firstly, in evaluating whether digital platforms are truly ‘essential facilities’, the core argument revolves around the assertion that these platforms are the railroads of the modern era which connect groups of consumers on either ends i.e., business users (sellers) and end consumers. Simply put, the usage of these platforms directly determines the volume of business or visibility that a seller gets and correlates to the number of choices that a consumer, by virtue of being a ‘bottleneck’ i.e., a service/an infrastructure that controls a process for which there is no sufficient bypass. This argument can be supported by the Court of Justice in Google and Alphabet v. Commission (Google Shopping case) which held that a search engine represents a ‘quasi-essential facility’ with no actual or potential substitutes. Furthermore, even the Competition Commission of India (CCI) in XYZ v. Alphabet Inc. & Ors. (Google Playstore case) has recognised that Google Playstore is a “critical gateway between app developers and users”, thereby indirectly affirming the theory that these platforms are indeed essential in the modern times.  Secondly, the requirement is that a ‘monopolist’ controls the essential facility. While prima facie reading shows that the tech space witnesses a massive influx of new companies, a deeper probe will reveal that the majority of the market share is still held by Google, Apple, Meta, Amazon and Microsoft (GAMAM), acting as gatekeepers, equivalent to monopolists in the traditional sense. As observed by the CCI in Umar Javeed & Ors. v. Google & Anr. (Google-Android case), the status quo maintained by GAMAM is attributable to strong network effects.  Thirdly, once a facility has been deemed as ‘essential’, the Courts assess whether competitors can reasonably duplicate the facility before mandating sharing. As discussed previously, due to advantages of network effects, it is impossible to duplicate the same without incurring significant costs.  Manifestation of the doctrine  In the EU, the DMA designates certain Big Tech platforms that serve as an important gateway for ancillary markets, as Gatekeepers supplying ‘Core Platform Services’, such as online search engines, online social networking platforms and operating systems, to name a few. Similarly in India, the Bill that draws inspiration from the DMA, designates such core platforms as ‘Systematically Significant Digital Enterprise’ (SSDE) supplying a ‘Core Digital Service’ in India.   Once designated, the entities will have to fulfil a set of behavioural obligations and ensure interoperability of third parties with the gatekeeper’s own services, so as to prevent refusal to access services that act as important gateways for business-to-business and business-to-consumer communication under Section 13 of the Bill and Article 5 of the DMA.   Thus, even though the terminologies differ, at the heart of both the legislations lie the intent to regulate such platforms that possess the characteristics of essential facilities, which if in the traditional sense would have required ‘sharing’, the modern-day application of which is interoperability.  MANDATING INTEROPERABILITY: ESTABLISHING A BOUNDARY  As much as regulating abusive behaviour by these Big Tech platforms is the need of the hour, mandating open sharing of platforms i.e., ‘interoperability’ might be problematic. Currently, the DMA mandates the platform to ensure interoperability and allow sideloading as well.  Technological considerations  It is argued that technology considerations take a back seat while mandating interoperability, thereby not being truly ‘feasible’. Scholar Guggenberger has suggested a renewed approach for the Doctrine wherein after an appropriate amortisation period, the regulator would mandate horizontal interoperability that would require the platforms to provide open access to their Access Point Interfaces (API). This would mean that Amazon would

[By Ayushman Rai] The author is a student of National Law University, Jodhpur.   Background Until the 2023 amendment, the Indian law didn’t explicitly take a stand between the global and relevant turnover, and hence the pendulum kept on swinging between the two. This article is written with the twin motives of examining the backdrop and implications of the changes in the basis for penalisation under Indian law; and assessing the extent to which this alteration conforms with the aims and objectives of competition policy, through a juxtaposition with other (European and British) jurisdictions.  Pre-Amendment Developments: Buildup to Excel Corp Case Initial inclination towards “global approach”  The notion of penalising the entity distorting competition based on its turnover has been universally accepted. However, there is a split of opinions on the appropriate basis for the calculation. Should it be calculated based on the firm’s turnover in the specific market where it has (or attempted to) distort competition, i.e., the “relevant turnover”; or should it be based on the “global turnover” of the firm regardless of the size/type of market distorted?  The initial years post-enactment saw the Competition Commission of India (CCI) attempting to take the widest import in fining, and went for the global turnover approach. Applied in a plethora of cases,1 the approach was justifiable to a certain extent, based on the aim of imposing penalties—“deterrence”.  The Excel Corp Rift   In order to prevent arbitrariness, Section 27 of the competition act provided that the onus was on the court to elucidate appropriate reasons before imposing punishment. However, the penalties imposed still seemed unjustifiably excessive and disproportionate in many cases.  This culminated in the Excel Corp Case, which was an appeal against a case where the penalties imposed were enormously disproportionate, despite being culpable for the same offence.  Proportionality, enshrined under Article 14, meant that the fine should be imposed proportionate to the gravity of the offence. Taking cue from South Africa, the court acknowledged the aim of deterrence (purposive interpretation), but conceded that it cannot go to the extent of imposing penalties that eradicates the existence of a firm. It was held that the aim of deterrence can be sufficiently served with “relevant turnover”, by reading the purpose with proportionality.  The 2023 Amendment: Inferences and Implications Debunking the Excel Corp  The 2023 amendment act addresses the issue of  the Excel Corp by explicitly adding an Explanation to Section 27, to clear the ambiguity. The purpose of deterrence is also served effectively  by the ‘global turnover’ approach. Moreover, the concern for disproportionality lies in the percentage of the turnover (on the scale of zero to 10 %) taken for the penalty, and not the nature of turnover- i.e., global or relevant. Section 45 of the amendment takes care of the same, by provisioning for guidelines to CCI for ensuring proportionality in imposing penalties.  The Positives  The amendment enforcing a reversion to the global approach is commendable for plenty of reasons, as it plugs several loopholes, which were not addressable by the relevant approach.  The digital (muti-market) conundrum— a major ambiguity revolved around penalising the “digital market platforms”. The non-feasibility of relevant turnover for digital enterprises was emphasized in Matrimony.com vs. Google. As Google could contend herein that it is bereft of any liability, since the search is free, there is no revenue from this stream of (relevant) market, hence no penalty. Such an inference would straightaway defeat the purpose of the act, and is impermissible. This stance found the latest reiteration in 2022, when the court in MMT-GO, interpreted the aggregate turnover under the titular of relevant turnover only, to preserve the aim of deterrence.  Dominant in one market, abusive in another (Tying cases)— the delineation of market is easier when the abuse is through anti-competitive agreement, but in the cases of abuse through dominant position (by conduct) it turns complex. More so, in cases where the firm in dominant in one market and is abusing it in the other (related) market. For instance, in a case of tying, where the firm makes the supply of the product (where it has dominant market) contingent on the purchase of another product (not dominant). Since, the relevant market is not determinate, the approach will fall flat here. Even if we take the market where abuse happens to be the relevant one, the fine imposed will be inept, unfair and insignificant to deter.   Cover bidding loophole—  the firms, not involved in the business of the product, were bid-rigging and getting away without being punished. This was being done through complementary bidding agreements (page 6). The CCI took no time to distinguish the case, reflected as a glaring drawback of relevant approach, from the Excel Corp. With the new amendment, this loophole is done away with.  The Negatives  While the amendment meets several of its targets, there are some aspects that reflect badly on it too.   Procedural accountability/scrutiny compromised— a major criticism of the amendment comes against the procedural irregularity in the pursuit of passing the bill. Specifically, the provision of the amendment (Explanation II of S. 20) doing away with the Excel Corp, was not included in the original amendment bill tabled before the Indian parliament. The provision, subsequently, was not scrutinised even by the Parliamentary Standing Committee on Finance, to which the bill was referred by the Lok Sabha on Aug, 17th, 2022. It was passed without debate once it was reverted by the Standing Committee. Moreover, it was not included even when the draft bill was published to invite public comments, hence it also escaped the direct public scrutiny. Thus, a major question arises as to accountability of this provision, which nullifies a landmark judgement in the arena of Indian competition law. It was not a recommendation of any committee report, not even the most recent CLRC report, nor was it debated by parliament, standing committee or even public, hence it has a shaky foundation.  Furthering the protectionist agenda— arguably an unintended repercussion of the amendment is the bias against the

[By Sidhanth M K Majoo] The author is a student of National Law University, Odisha.   Introduction Competition Commission of India recently passed an order requiring Swiggy to share confidential business information. Swiggy filled a petition in the Karnataka High Court challenging this order on the ground that is it arbitrary and could detrimentally impact its business operations.  The dispute originates from a 2021 complaint by the NRAI, in which it accuses Swiggy and Zomato of engaging in anti-competitive practices. In response to that complaint, the CCI initiated an investigation in 2022, which led to the current contention over the confidentiality of the information disclosed during the probe​​​​.  While this particular complaint is Sub Judice, this situation does shine light on the confidentiality practices that the CCI has adopted, or lack thereof.    This article evaluates the effectiveness of confidentiality measures in India’s competition law. It explores the evolution of confidentiality regulations, assesses their current effectiveness, and compares them with international standards from the ICN. The piece also highlights the impact of inadequate safeguards on the fairness and integrity of competition law enforcement in India.  Assessing the Sufficiency of CCI’s Confidentiality Measures  Currently in India, confidentiality in proceedings conducted by the CCI is governed by specific provisions in the Competition Act, 2002, along with supplementary regulations. Section 57 of the Act mandates that the CCI shall keep information relating to any enterprise, being confidential, as confidential unless the disclosure of such information is required under the provisions of the Act or for compliance with any other law.   Regulation 35, of the Competition Commission (General) Regulations, 2009, currently provides a framework for treating of sensitive information, and prevents disclosure of it to protect business interests.  In May 2024, CCI introduced the CCI (General) Amendment Regulations, 2024, aiming to enhance its confidentiality regime in legal proceedings. This was preceded by a Public Consultation initiated by the CCI in February of 2024. This is not the first time CCI has made major changes to the regulations, as a matter of fact in 2022, CCI introduced the concept of a confidentiality ring which allows limited access to sensitive information during investigations.  The  Competition Commission of India (General) Amendment Regulations, 2024 mainly formalize the process for establishing a confidentiality ring upon request, designating specific time rings for the same. They have also adjusted the protocol for document inspection and the associated fees, aiming to streamline procedures and ensure more effective case handling while providing parties more robust means to protect and manage confidential information.  However, one must wonder if these enhanced measures are sufficient to ensure the integrity and fairness of the proceedings, or is it too little too late. As we consider the domestic efforts to bolster confidentiality within the competition framework, it is insightful to look towards international collaborations that influence these practices globally.  Breaking Borders: How ICN Shapes Global Competition Policies  The International Competition Network (“ICN”) is a global partnership which was formed in 2001 with the purpose of enhancing the efficacy of competition law enforcement worldwide. It unites competition authorities from diverse jurisdictions, fostering a collaborative space where ideas and best practices in competition policy and enforcement are exchanged. Periodically, the ICN releases documents and guidelines. It is prudent to note at this point that India recently became a member of the steering group of ICN in 2023.  The ICN Recommended Practices for Investigative Process states that transparency regarding the legal standards and agency policies is crucial for accountability and predictability in enforcement. It is advised that agencies should communicate clearly about their procedures and investigative tools, and provide reasons for their decisions to foster understanding and compliance. While these practices advocate for a balanced approach that considers the commercial interests, procedural rights, and enforcement transparency, the situation in India appears to diverge from these ideals.  Transparency protocols in India do not live up to the same standards that has been recommended by the ICN.  The Protocol recommends that competition agencies should possess internal safeguards, in case the CCI has any they have not been communicated to the public.  Section 57 of the Indian Competition Act primarily outlines a general obligation for the CCI to maintain confidentiality without providing specific guidelines on what should be classified as confidential. ICN recommends the contrary in the form of detailed conditions for handlining sensitive personal data and trade secrets. India not living up to this recommendation could be a bane for it in the long term for its competition regime. This gap not only limits the effectiveness of confidentiality protections but also impacts the overall trust in the enforcement process managed by the CCI.  ICN also in the Recommended Practices for Merger Notification and Review Procedures suggests that competition agencies should defer contacting third parties about a merger until it becomes public knowledge, unless early contact is essential for the review. The regime in India again fails to clearly release guidelines which fulfil this role.  Global Trends in Confidentiality: Lessons for India  A survey conducted of 39 ICN members (Not including India) regarding confidentiality practices in their countries shines a dark light on the current situation in India. It was observed that confidential documents are generally destroyed once a case has been resolved – a practice not explicitly defined in India’s competition law regime. The survey’s findings emphasize the need for India to consider incorporating these practices to enhance the robustness and reliability of its competition law procedures.   The survey indicated that 92% of the agencies around the world have established statutory provisions to protect confidential information obtained during investigations. 70% of these agencies publish the criteria governing their handling and treatment of confidential information. India has till date not notified any such procedures to the general public.  The ICC’s Blueprint for Competition Law  Even the International Chamber of Commerce has released a document titled “Recommended Framework for Best Practices in International Competition Law Enforcement Proceedings” which underscores the importance of procedural safeguards such as transparency, due process, and non-discrimination to ensure fairness in

[By Anmol Aggarwal] The author is a student of Rajiv Gandhi National University of Law, Patiala.   Introduction  The Ministry of Corporate Affairs (“MCA”) on 12 March 2024 released the draft report of the Committee on Digital Competition Law (“CDCL”) and a Draft Digital Competition Bill (“the draft bill”). The CDCL report seeks to lower the threshold of proof required to determine anti-competitive practices by certain large undertakings to the lowest threshold of “ex-ante measure” or determining the abusive practices on a “by object” basis. This essentially means that the anti-competitive practices by such undertakings would be determined without examining any effects or potential effects of the conduct. The report proposed several quantitative and qualitative benchmarks to determine the entities that would fall under the ambit of the new bill, designating these entities as Systematically Significant Digital Enterprises (“SSDE”). In this piece, the author analyses how this shift from ex-post to ex-ante framework for SSDEs is harmful. It poses a huge risk of false convictions and will disincentivize such enterprises to indulge in innovations. The report mentions that the current move is in line with the Digital Markets Act, 2022 (“DMA”) enacted in the European Union (“EU”). Although not viable, under the EU Competition Law, the low threshold of the ex-ante framework can still work as it imposes only monetary fines for infringements. However, such a low threshold is dangerous in the Indian Competition regime as it consists of monetary fines and imprisonment of a term extending up to 3 years in case of an infringement. The author argues that such a low threshold is not viable in a framework in which the punishment consists of imprisonment in addition to monetary fines.  Risk of false convictions  The new ex-ante framework or “by object” approach in identifying abuse of dominance by SSDEs poses a huge risk of false convictions, which goes against the principle of presumption of innocence. This principle is an undebated principle that works to favour the undertaking alleged of the abusive conduct. The determination of the abuse by object, i.e. before even looking at the facts, will result in innocent actions of the firms to come under the ambit of anti-competitive conduct.   For instance, let us assume a dominant software company provides an office suite with several tools like Word processing software, presentation software and spreadsheets, among others. This company has introduced a new email management system integrated into the suite. Now, the company has done the same with an intent to improve the consumer experience and provide seamless productivity and streamlined workflows to the consumers. The dominant firm, while not intending to foreclose competition, would face liability for tying under the ex-ante framework, leading to the imposition of a huge fine.  Under the EU jurisprudence, the antitrust fines qualify as “criminal sanctions” as they meet the “Engel criteria” developed by the European Court of Human Rights (“ECHR”). This criterion considers several factors, such as the nature of the penalty and domestic context, among others. Given that the Indian Competition regime has largely evolved by examining the EU Competition regime, one can infer that antitrust fines in India also qualify as “criminal sanctions”. Looking at the severity of punishments for finding abusive conduct, avoiding false convictions at any cost is imperative. As stated by a famous English Jurist that “It is better that ten guilty persons escape than that one innocent suffer”. The new bill seeks to prevent anti-competitive conduct before it even materialises, which, looking at the high risk of false convictions, will prove to be a blunder in the Indian Competition regime.  To avoid such risks, the EU Competition regime has consistently shifted towards an effects-based approach or ex-post framework when analysing anti-competitive conduct.  As can be observed in the recent competition policy brief (“policy brief”) regarding 2023 amendment to the 2008 Guidance on the Commission’s Enforcement Priorities in Applying Article 82 (“Guidelines”), wherein the policy brief departs from the object-based approach of the 2008 Guidelines, stating that “the Commission is committed to an effects based enforcement of Article 102 TFEU, which fully takes into account the dynamic nature of competition and constitutes a workable basis for vigorous enforcement”. As the EU competition regime progressively adopts an effect-based approach, it is incongruous for the Indian Competition regime to regress towards an object-based approach in assessing anti-competitive conduct.  The Justification Of It Being In Line With EU’s DMA Is Erroneous  One line of reasoning we can observe while looking at the report is that the proposed bill is in line with the EU’s DMA, 2022. This reasoning is highly erroneous, as discrepancies exist in the punishments prescribed in the proposed bill and DMA. The punishment under the DMA is a monetary penalty of up to 10% of the undertaking’s worldwide annual turnover, which extends to a maximum of 20% considering the repetitive infringements. Contrary to this, the punishment for repetitive infringements and not following the orders of the Competition Commission of India (“CCI”) embarks an imprisonment of up to 3 years in addition to huge monetary fines. Thus, the threshold of determining anti-competitive conduct cannot be compared to the DMA, as the punishments under the proposed Bill and DMA are inconsistent.  Further, the criteria to determine the firms that would fall under the ambit of SSDE is highly arbitrary as it vests a disproportionately large discretion with the CCI. This arbitrariness exists because the report gives discretionary power to CCI to designate an undertaking as SSDE, even if it does not meet the quantitative and qualitative criteria laid down in the report. An ex-ante approach coupled with such arbitrariness and punishments, including imprisonment in addition to the monetary fines, will be a disastrous measure for the Indian Competition Regime.  The Proposed Rules will Disincentivise Firms To Indulge in Innovatation  The proposed bill puts the SSDEs under large scrutiny and restrictions, which will, in turn, lead to a strike at the innovation. The dominant firms are the largest contributors to present-day innovations around the globe, consider the

[By Gurman Narula & Sharad Khemka] The authors are students of National Law Institute University, Bhopal.   Introduction  Section 53B of the Competition Act states that any enterprise, government or “any person aggrieved” can file an appeal challenging the order of the Competition Commission of India. The term “Person aggrieved” is not defined anywhere in the whole act, the courts and tribunals have tried to delineate the definition of person aggrieved in the context of the Competition Act but there is no fixed definition of the term and the court has followed different approaches while assessing the Locus Standi of Appellants who have filed an application u/s 53B of the Act. Although individuals who are parties to the case can file an appeal, the law is unclear on persons who are not parties to the case.   The discussion will begin by exploring the judicial evolution surrounding the term “person aggrieved.” Following this, the latest position on this matter will be elaborated. The terms will be analysed within different contexts to ensure a thorough comprehension. Lastly, an evaluation of the legal standpoint will be conducted, along with a discussion of suggested solutions.  Judicial evolution of the term ‘Person Aggrieved’   There is no definition of ‘person aggrieved’ in the competition act. The competition act states that ‘any person aggrieved can file an appeal’. The act provides that a person has to be aggrieved in order to file an appeal challenging the order, there is no part of the act which seeks to define the term.   The courts while delineating the term has relied on judgements which provide a general overview of the term ‘person aggrieved’. The court in the case of Adi Pherozshah Gandhi v HM Seervai observed that, “Disappointment with a case’s outcome doesn’t grant a ‘person aggrieved’ status. There must be a loss of expected benefits due to the order, leading to a legal grievance. Mere disagreement with the order or belief in someone’s guilt isn’t sufficient for legal standing”.  Further, in the case of A. Subash Babu v State of Andhra Pradesh it was observed by the Hon’ble Supreme Court that, “The term ‘aggrieved person’ is flexible and abstract, defying rigid definition. Its interpretation depends on various factors, including the statute in question, specific case circumstances, the complainant’s interests, and the extent of prejudice or injury suffered.”  While discussing the Locus Standi u/s 53B, the circumstances of each case shall be discussed and the intent of the Competition Act needs to be taken into consideration. The intent behind the Competition Act can be inferred from the Preamble of the Act which is;   An Act to provide, keeping in view of the economic development of the country, for the establishment of a Commission to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carried on by other participants in markets, in India, and for matters connected therewith or incidental thereto.  The term can be given different meanings in different circumstances which will be discussed in the later stage.   The court in the case of Ayaaubkhan Noorkhan Pathan v State of Maharasthra observed that, “It is legally established that outsiders cannot interfere in proceedings unless they prove they are aggrieved. Only those who have suffered legal harm can challenge actions in court. The court can enforce a public body’s duty if the petitioner proves a legal right, essential for invoking the court’s jurisdiction. Relief sought must enforce a legal right, usually belonging to the petitioner.”  These judgments did not delineate the term ‘person aggrieved’ in the context of Competition Act or in the specific circumstances of that of an appeal related to the Competition Act.   Person Aggrieved in the context of the Competition Act  The NCLAT in the case of Jitendra Bhargav v CCI delineated person aggrieved in the context of Competition Act by taking into account various judgements, some of which has been provided in the earlier section.   The NCLAT noted that Locus standi needs to be proved before proceeding with analyzing the merits of the case. In the case, Jitendra Bhargav filed an appeal challenging the order of CCI approving the merger between Jet and Etihad.  Jitendra Bhargav contended that there is a likelihood of Appreciable Adverse Effect on Competition (AAEC).   NCLAT held that likelihood of AAEC cannot pose as a sufficient ground to allow the appeal of Jitendra Bhargav and it needs to be proved first that the person appealing the order is an aggrieved person and the order of CCI cannot be discussed on merits until the Locus standi of the appellant is proved.   The Supreme court in the case of Samir Aggrawal v Union of India held that, “The expression ‘any person’ in section 53B needs to be construed liberally. The court held that appeals which are in the nature of public interest should be allowed and since the CCI performs an inquisitorial function, the doors of CCI and the appellate body NCLAT must be kept wide open.  This case brought a shift in the approach adopted by the courts and the tribunals while delineating who will constitute as a person aggrieved within the meaning of Section 53B. It led the courts and tribunals to take a liberal and expansive approach rather than strict interpretation of the section.   The latest case involving appeal u/s 53B is that of UP glass manufactures v CCI. NCLAT in the present case allowed the appeal filed by UP glass manufactures while adopting the approach taken in the case of Samir Aggrawal.   Analysis  Although the approach established in the Samir Aggrawal case is in line with the intent and objective of Competition act as it seeks to allow appeals that aim to ensure a level playing field and prevent firms from indulging in anti-competitive practices, it leads to perplexity and inefficiency as this approach cannot be used uniformly in all the cases.   In the case of UP glass manufactures, the appeal was allowed,

[By Soujanya Boxy & Shourya Mitra] The authors are students of National Law University, Odisha and Jindal Global Law School, Sonipat, Haryana respectively.   Introduction  The new-age digital world is increasingly embroiled in a complex interplay between tech giants and market fairness regulators. Striking a balance between effective regulation and fostering innovation has become more crucial than ever. Apple, designated as a “gatekeeper” under the European Union’s (‘EU’) Digital Markets Act (‘DMA’), faces scrutiny for its closed mobile ecosystem. Critics and competitors argue that this closed ecosystem stifles their ability to reach users, limiting user choice and stifling competition.   However, the burning question is whether proponents of reforms can solely justify their demands for an open mobile ecosystem by highlighting its tangible benefits, without acknowledging the advantages of closed ecosystems to users and competition. In this post, the authors explore the multifaceted impact of Apple’s closed ecosystem on competition and consumers.   Biting the Apple: A Look at Antitrust Issues  Apple, a leading tech company, has cemented its footing in the market for personal devices through its unique walled garden-like ecosystem, which remains a source of contention within the mobile ecosystem for being restrictive and anti-competitive. A mobile ecosystem is the interconnected world of a mobile device company’s products and services, including hardware, software, apps, and user accounts.  While many antitrust lawsuits are already pushing Apple to revamp its model or ecosystem, new laws like the much-discussed the EU’s DMA and South Korea’s recent amendment to its Telecommunication Business Act are adding pressure to open up Apple’s ecosystem, aiming to restore fairness and competitiveness in the market. In response to the EU’s DMA designating Apple as a gatekeeper, the company has announced changes to its operating system (iOS), App Store, and web browser (Safari). These changes loosen restrictions on its devices, particularly regarding payment processing and app distribution. Apple is opening its previously walled garden-like ecosystem to rival app developers and marketplaces, and introducing new terms for using alternative payment methods and distributing apps. While the changes have their criticisms, they represent a major shift for Apple and an attempt to comply with the DMA.  A common thread runs through antitrust debates on Apple’s practices as several jurisdictions including the EU, United States (‘US’), Russia, and China share concerns about similar anti-competitive practices. App developers argue that Apple’s high fees and control over the App Store are causing them substantial financial losses. Countries, such as Japan and South Korea, have already taken action by requiring Apple to modify its App Store practices. Similarly, the US Justice Department is in the final stages of a probe examining Apple’s practices related to its hardware and software integration, specifically how these practices may limit competition and discourage users from switching to alternative platforms. Specifically, the investigation is looking into how Apple’s practices, such as restrictions on iMessage and the enhanced functionality of Apple Watch when paired with iPhones, may stifle competition in the mobile device market.  As global antitrust regulators tighten their scrutiny and enact stricter laws to control Apple’s alleged monopolistic practices, concerns are mounting that these regulatory measures may go beyond achieving fairness and could inadvertently hinder the company’s ability to generate profits.  Further, antitrust legislative reforms are aimed at controlling the platforms’ ability to offer and integrate their own apps and services alongside of their competitors, which could unfairly incentivise their own offerings. Competing app developers express concerns over Apple’s excessive app fees and its practice of integrating its own services, like the music-streaming service, with its features like SharePlay and Photos. Additionally, Apple exempts its own services from the app fees payment, enabling them to undercut their competitors on price.   The European Commission (‘EC’) ruled that Apple is in preliminary violation of antitrust laws, citing antitrust concerns in the mobile wallet market. Apple was found abusing its dominant position by restricting mobile wallet app developers’ access to necessary software and hardware on iOS devices, thereby reducing competition in the mobile payments space. As a response to these concerns raised in the European Economic Area (‘EEA’), Apple came up with the proposal, allowing third-party developers to provide the option to their users to make Near-Field Communication (‘NFC’) contactless payments on their iOS apps, without relying on Apple Wallet and Apple Pay.  Walled Garden or Secure Oasis?  Apple is worried about the negative impact on its user privacy and security as some regulations have begun to mandate the inclusion of third-party App Stores and apps on its devices. Currently, all apps distributed through its own App Store go through a standard vetting process. On top of that, the company maintains a closed ecosystem, wherein apps are downloaded only through its App Store to ensure user privacy and security. Despite this, it faces increasing pressure to open up its ecosystem, allowing alternative App Stores and “side-loading”, which could pose challenges for upholding the existing user privacy and security standards.  While Apple’s robust vetting process and closed ecosystem build a perception of enhanced-level user privacy and security, vulnerabilities do still exist. Yet, Apple’s comprehensive approach, including close scrutiny of apps and ongoing security improvements, helps to safeguard its devices from malware intrusion. The Apple devices are built in such a way that the users even accidently can’t fall prey to any malicious sites or apps.   While critics of Apple’s ecosystem focus on its drawbacks, they should also consider the possible security risks that Apple has consistently highlighted for its users. Privacy and security concerns remain paramount in today’s digital landscape. It is not only unethical but eventually unsustainable to sacrifice users’ trust for the sake of perceived competitive fairness.  The Fight for an Ecosystem  A growing trend of building a closed ecosystem among tech giants like Apple, raises concerns about locking users into using a range of their products and services and potential self-preferencing. Self-preferencing is a practice by large digital platforms of favouring their own products or services over those offered by competitors operating on their platforms. The DMA currently cracks