Introduction: In India’s vibrant marketplace, the Competition Commission of India (CCI) stands as the guardian of fair play, mandated by the Competition Act, 2002. This article unravels the essence of the CCI, its establishment, composition, and pivotal role in maintaining competition integrity.
Ever wondered who stands as the guardian of fair play in India’s bustling marketplace?
It’s none other than the Competition Commission of India (CCI), established under Chapter III of the Competition Act, 2002.
This article, the fifth in our series delving into this landmark legislation, takes you on a journey to understand the very foundation of the CCI – its establishment, composition, and the team that drives it.
We’re about to unlock the secrets behind the scenes of this crucial institution that ensures a level playing field for businesses and protects consumers from harmful practices. Are you ready to see how the CCI is built and who wields the gavel of competition justice?
Then dive in with us and explore the fascinating world of the CCI. Today we will unravel from section 7 to section 17 of the Act.
What is the Competition Commission of India (CCI)
Hold On competition champions!
Before we dive into Chapter III, it’s time to meet the ultimate referee, the one and only Competition Commission of India (CCI)! Buckle up, because understanding the CCI is key to unlocking the secrets of Chapter III.
The Commission (CCI), established under the Competition Act, 2002, is a statutory body entrusted with enforcing competition law in India. It aims to promote and sustain fair competition, prevent anti-competitive practices, and protect consumer welfare. The CCI regulates agreements, abuse of dominant position, and combinations that may adversely affect competition in Indian markets. It conducts inquiries, issues orders, and imposes penalties for violations to ensure a level playing field for businesses and enhance economic efficiency. The CCI’s mandate is to foster a competitive environment conducive to innovation, efficiency, and consumer choice.
The CCI is not just any commission on paper. CCI wields a demonstrably active and impactful role in safeguarding fair market practices. The CCI chief’s dissent note to google and CCI’s probe into Apple and google for unfair trade practices serve as a potent example. The current CCI Chief Ravneet Kaur wields several key powers. She ordered investigations into potential anti-competitive practices, as seen with Google (smart TV & news content) and Apple (App Store). Upon receiving investigation reports from the Director General, the Chairperson led the Commission in evaluating findings and determining appropriate actions. As demonstrated, the Chairperson took exemplary remedies to tackle the unfair trade practice. The CCI Chairperson represents the Commission in legal challenges to its decisions, as evident in Google’s appeal to NCLAT.
Let’s delve into the sections under Chapter III of the Competition Act, 2002. Let’s understand how and of whom the commission is formed.
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Section#
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Section Title |
Understanding of the section |
| 7 |
Establishment of Commission |
- Established by the central government on a specific date.
- Functions as a statutory body with independent legal standing.
- Manages its own finances and assets.
- Head office at a designated location chosen by the government.
- Can establish additional offices in other parts of India.
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| 8 |
Composition of Commission |
- Composition of Commission: 1 Chairperson, 2-6 Members appointed by the Central Government
- Chairperson and Members’ Qualifications: Ability, integrity, standing, special knowledge/experience (15+ years) in relevant fields
- Term of Office and Removal: 5 years, removable by President on recommendation of Chief Justice of India or by Parliament on grounds of misbehaviour or incapacity
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| 9 |
Selection Committee for Chairperson and Members of Commission |
- Chairperson: Chief Justice of India or their nominee.
- Members:
a) Secretary in the Ministry of Corporate Affairs.
b) Secretary in the Ministry of Law and Justice.
c) 2 experts of repute with specialized knowledge and professional experience in various fields such as international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs, competition matters, including competition law and policy.
- Central Government holds the authority to appoint the Chairperson and Members of the CCI based on recommendations by the Selection Committee.
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| 10 |
Term of office of Chairperson and other Members |
- Term of office: Chairperson and Members serve 5 years from the date of entering upon office; Eligible for Re-appointment if deemed fit.
- Age limit: 65 years
- Filling up of vacancy: Fresh appointment in accordance with the provisions of sections 9
- Oath: Oath of office and of secrecy before entering upon office which emphasizes upon importance of integrity and confidentiality in role
- Acting Chairperson: Senior-most Member, until a new appointment is made.
- Temporary Discharge of Duties: If the Chairperson is unable to fulfil their duties, the senior-most Member temporarily takes over the responsibilities until the Chairperson resumes their duties.
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| 11 |
Resignation, removal and suspension of Chairperson and other members |
- Resignation: Chairperson or Members resign by written notice to the Central Government. Must stay in office for 3 months after notice, unless permitted to leave sooner, or until their successor takes office, whichever is earliest.
- Removal: Central Government can remove Chairperson or Member for being a) Adjudged insolvent, b) Engaged in paid employment during their term with CCI, c) Convicted of an offense involving moral turpitude, d) Acquired financial or other interest affecting their ability to function impartially, e) Abused their position, making continued service harmful to public interest, f) physically or mentally unfit for the role.
- Removal based on clauses (d) or (e) (financial interest or abuse of position) requires Supreme Court approval after an inquiry.
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| 12 |
Restriction on employment of Chairperson and other Members in certain cases |
- Restriction: For 2 years after leaving their positions, The Chairperson and Members prohibited from accepting certain employment.
- Restricted employment: Working in or being associated with the management or administration of any enterprise that has been involved in a proceeding before the CCI.
- Exceptions to Restrictions: Allowed to work with Central Government, State Government, Local authorities, Statutory authorities, Corporations established by law and Government companies
- Purpose of restrictions: To prevent potential conflicts of interest and maintain the impartiality of the CCI; To ensure that former members cannot leverage their insider knowledge or relationships gained during their tenure at the CCI for personal gain.
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| 13 |
Administrative powers of Chairperson |
- General Superintendence: The Chairperson holds overall responsibility for managing the Commission’s administrative affairs, such as setting direction, overseeing daily operations, and ensuring efficiency.
- Power Delegation: The Chairperson can delegate specific administrative tasks to other members or officers of the Commission. The extent of delegation is left to the Chairperson’s discretion.
- Accountability: The Chairperson remains ultimately accountable for overall administrative performance.
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| 14 |
Salary and allowances and other terms and conditions of service of Chairperson and other Members |
- Determination: Salary, allowances, and other terms of service (including travel expenses, house rent allowance, conveyance facilities, sumptuary allowance, and medical facilities) for the Chairperson and Members are prescribed by regulations.
- Protection: Once appointed, the salary, allowances, and other terms of service cannot be reduced for the Chairperson or any Member.
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| 15 |
Vacancy, etc. not to invalidate proceedings of Commission |
- Proceedings Remain Valid: Even if some Member positions are vacant, the Commission can still function and its decisions remain valid. Minor errors in appointing the Chairperson or Members won’t invalidate actions.
- Rationale and Implications: safeguarding the Commission’s functioning and prevents technicalities from derailing crucial decisions. It ensures efficient enforcement of competition law and protects the interests of businesses and consumers.
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| 16 |
Appointment of Director General, etc. |
- Director General: Appointed by the Central Government
- Additional, Joint, Deputy and Assistant Directors General: Number and appointment prescribed by the Central Government, Exercise powers under the supervision of the Director General
- Director General and Additional, Joint, Deputy and Assistant Directors General : Salary and terms of service prescribed by the Central Government, appointed from persons with integrity, experience and knowledge of investigation, accountancy, management, business, public administration, international trade, law or economics
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| 17 |
Appointment of Secretary, experts, professionals and officers and other employees of Commission |
- Secretary and Employees: The CCI can appoint a secretary and other employees necessary for its operations. Salaries, allowances, and service conditions of the Secretary and employees are prescribed by regulations. Specific numbers of employees are also regulated.
- Experts and Professionals: The CCI can engage a specific number of experts and professionals based on specific needs. These individuals must have integrity, proven ability, and specialized knowledge in relevant fields like economics, law, business, and competition-related disciplines. Engagement procedures are defined by regulations. Experts and professionals assist the CCI in discharging its functions under the Competition Act.
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With this, we’ve come to the end of our article. Remember, the CCI is not a static entity, but rather a dynamic force, consisting such knowledgeable experts, constantly adapting to the evolving landscape of Indian markets.
But our exploration of the Competition Act doesn’t end here. Stay tuned for the next article in this series, where we’ll delve deeper into the specific powers and functions entrusted to the CCI. We’ll examine how it investigates anti-competitive practices, cracks down on cartels, and protects consumer interests. So, keep your curiosity ignited, sharpen your knowledge, and join us on this journey through the world of competition law in India!
