CCI must enforce penalty rules for competition law violations: House panel

Fair trade watchdog CCI should vigorously enforce the determination of penalty guidelines to curb the risk of repeated competition law violations being internalised as a "mere cost of doing business", according to a Parliamentary panel.

These guidelines provide for repeated competition law contraventions as an aggravating factor while imposing penalties to ensure that such offences do not happen in the future, the Committee on Subordinate Legislation of the Rajya Sabha said.

The recommendation is part of the report tabled this week in Parliament by the committee chaired by Milind Murli Deora on the Competition Commission of India (CCI).

In the report, the committee said vigorous antitrust enforcement is indispensable to ensure that the least advantaged are not further disadvantaged by unfair or anti-competitive conduct.

 

"Small businesses, MSMEs, startups etc should be able to depend upon a steady and vigorous enforcement of the competitive laws to safeguard their ability to compete...," it said.

The panel also raised concerns over the issue of repeated contraventions of competition laws and regulations by corporate entities.

"Such repeated contraventions risk being internalised as a mere 'cost of doing business', thereby severely undermining the deterrent effect of the laws and regulations," the panel said.

Against this backdrop, the committee noted that CCI should vigorously enforce the Determination of Monetary Penalty Guidelines, which provide for repeated contraventions as an aggravating factor, so as to ensure deterrence for future offences.

The committee examined CCI's regulations on commitment, settlement, determination of turnover or income, and determination of monetary penalty guidelines.

Another recommendation of the panel is that the corporate affairs ministry and CCI should undertake a periodical review of the regulatory architecture of the whole gamut of the competitive law framework.

According to the committee, the reviews should involve comprehensive stakeholder consultations and systematically benchmark the domestic framework against global best practices.

"The committee feels that competition laws should keep up with the pace of change, especially in the digital era and that they must be updated from time to time to deal more effectively with new problems and specific challenges," the report said.