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An
institution which has sunk into the consciousness
of Indians is about to fade away into oblivion
after four decades. The anti-monopoly watchdog
Monopolies and Restrictive Trade Practices
Commission (MRTPC) will stop entertaining fresh
cases from September 1, as it makes way for the
new Competition Commission of India (CCI).
A
notification to this effect will be issued by the
Government, the Minister of State for Corporate
Affairs, Mr Salman Khurshid, said here on Saturday
at a function organised by the PHD Chamber of
Commerce and Industry.
Repeal
of ACT
This
would mean that the MRTP Act, 1969 would be
repealed and new cases regarding restrictive trade
practices and monopolies will come up before the
CCI.
Simultaneously, the Government is also considering
notifying the merger control provisions in the
amended Competition Act and the Prime Minister, Dr
Manmohan Singh, is looking into it, Mr Khurshid
said.
The
Minister said the Government would consider
suggestions from stakeholders regarding the
relevant provisions on mergers and acquisitions
(M&A) for a few more days.
However, he did not give any timeline for
notification of Section 5 and 6 of the amended
Competition Act.
Section 5 is about “combinations” and the
thresholds for regulating them, while Section 6
gives powers to the CCI to investigate
combinations that are higher than the said
threshold levels. The combinations may include
mergers, acquisitions of assets, shares, control
or voting rights as well as amalgamations that in
turn affects competition.
MRTPC
had stopped looking into M&A cases after 1991.
Mr M M
Sharma, Head (Competition Law and Policy), Vaish
Associates Advocates, told Business Line: “The
Government had notified the provisions (Section 3
and 4 of the Competition Act) regarding
anti-competitive agreements and abuse of dominant
position this May. But they are delaying the
notification of M&A provisions without giving
adequate reasons.”
The
relevant provision that will put an end to fresh
cases being filed before MRTPC, a quasi-judicial
body, is Section 66 of the amended Competition
Act. After the notification of Section 66, MRTPC
will function only for another two years to
dispose of pending cases.
Transfer of cases
Following the two-year period, the pending unfair
trade practices (UTP) will be shifted to the
National Consumer Disputes Redressal Commission,
while the pending restrictive trade practices (RTP)
cases and those involving a combination of UTP,
RTP and monopolies will be transferred to CCI.
Mr
Pradeep Mehta, Secretary General of the NGO ‘CUTS
International’ and a competition law expert, told
Business Line: “The Competition Act was badly
drafted as far as Section 66 is concerned. It has
resulted in wastage of time and money for many.
There were some vested interests behind the kind
of grayness in the law. It should have been an
automatic provision giving powers to the CCI,
rather than one that had to go back to the
Government for notification. The Competition Act
of the UK had an inbuilt clause saying provisions
contravening the Act will stand automatically
repealed after the notification of the Act.”
Long
overdue
Pointing out that the notification of Section 66
was “long overdue”, Mr O.P. Dua, Senior Advocate,
told Business Line that while there was no fee to
file a case before the MRTPC. According to the CCI
norms, one has to pay a fee of Rs 50,000 for
registering a case, he said, adding “this is a
heavy amount and many people think twice before
filing a case with CCI. The Government should look
at lowering it.”
Only
recently, CCI had commenced looking into cases
pertaining to abuse of dominant position and
cartelisation. Prior to that CCI was only playing
the role of an advisory body.
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