Competition Act, 2002
India's antitrust law — anti-competitive agreements, abuse of dominant position, merger control, CCI enforcement, penalties, leniency programme, and the 2023 amendment changes.
🏛️ Background
The Competition Act, 2002 replaced the outdated MRTP Act, 1969 and came fully into force by 2009. Administered by the Competition Commission of India (CCI), it promotes fair competition, prevents anti-competitive practices, and protects consumer interests. The Competition (Amendment) Act, 2023 introduced deal value thresholds for merger filings and settlement/commitment mechanisms.
🚫 Anti-Competitive Agreements (Section 3)
📊 Horizontal Agreements
Agreements between competitors — price fixing, output restriction, market allocation, bid rigging. Presumed anti-competitive (per se illegal). Cartels attract harshest penalties.
📋 Vertical Agreements
Agreements between entities at different supply chain levels — tie-in arrangements, exclusive supply/distribution, resale price maintenance, refusal to deal. Analysed under rule of reason.
💰 Penalties
CCI can impose penalty up to 10% of average turnover for preceding 3 years. For cartels: up to 3x the profit or 10% of turnover, whichever is higher. Directors can be personally penalised.
🏳️ Leniency Programme
First cartel member to disclose gets up to 100% penalty reduction. Second: up to 50%. Third: up to 30%. Incentivizes breaking cartels from within. Application to CCI under Section 46.
👑 Abuse of Dominant Position (Section 4)
- 📌 Dominance: Position of strength enabling the enterprise to operate independently of competitive forces. Market share is indicative but not sole determinant. CCI examines relevant market
- 📌 Abusive Practices: Unfair pricing, predatory pricing, discriminatory conditions, denial of market access, leveraging dominance in one market to enter/protect another, imposing supplementary obligations
- 📌 Digital Markets: CCI increasingly active — investigated Google (₹1,337 Cr penalty, 2022), Amazon, Flipkart, Apple. 2023 amendment introduced "significant business presence" test for digital enterprises
- 📌 Penalty: Up to 10% of average turnover for preceding 3 years. CCI can also issue cease-and-desist orders and structural remedies
🔄 Merger Control (Sections 5-6)
- 📋 Mandatory Filing: Combinations (mergers, acquisitions, amalgamations) exceeding asset/turnover thresholds must notify CCI. Filing within 30 days of board approval or execution
- 💰 Thresholds: Combined assets >₹2,000 Cr or turnover >₹6,000 Cr (India); or assets >$1 billion or turnover >$3 billion (worldwide with India nexus)
- 🆕 Deal Value Threshold (2023): Transactions with deal value >₹2,000 Cr where target has "substantial business operations in India" — captures digital acquisitions of high-value startups
- ⏱️ Timeline: CCI must respond within 30 working days (Phase I). If investigation needed: additional 150 days (Phase II). Deemed approved if no order within time
⚠️ Disclaimer
This page is for educational and informational purposes only and does not constitute legal, tax, or financial advice. While we strive for 100% accuracy, laws and regulations change frequently. Always refer to the official gazette notifications, consult a qualified Chartered Accountant (CA), Company Secretary (CS), or legal professional before making any financial or legal decisions. Tenhash is not responsible for any actions taken based on this information. Last reviewed: March 2026.