The Competition (Amendment) Bill, 2022 seeks to capture deals happening in global digital companies, provided the entities involved have a strong business presence in India. Any such deals where the value exceeds Rs 2,000 crore will need to be notified to the Competition Commission of India (CCI).
For imposing penalties on MNCs, the CCI, as per the amendments, will consider the global turnover of the company being penalised instead of the current practice of calcu- lating the penalty based only on the relevant market revenue. Currently, the CCI imposes a penalty up to 10% of a company’s average turnover in the relevant market where it had violated the regulations.
Going forward, the calculation will be based on the revenue generated from all the business operations of the accused entity, said legal experts, who termed the move debatable.
“From a business’ point of view, the consideration of total turnover may lead to unfair and punitive outcomes and would also lead to discrimination between enterprises who commit a similar contravention but are penalised differently depending on the expanse of their business,” said Avantika Kakkar, partner and head of competition at law firm Cyril Amarchand Mangaldas.
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Corporate affairs and finance minister Nirmala Sitharaman moved the Bill in the Lok Sabha, which passed it without debate. She also moved certain amendments to the original Bill.
SETTLING CASES
The Bill proposes to introduce a settlement scheme for lighter violations and also provides more clarity on the definition of “control”.
Settlement is a framework where an entity accused of an antitrust violation can settle the case with the CCI without admitting or denying guilt
