India’s Competition Law: A Case of an Antitrust Paradox

Introduction

Through a critical analysis of the case laws pertaining to the Indian e-retail market and the radio taxi services market, this paper tries to establish that the design of Section 4 of the Indian Competition Act and its enforcement by the Competition Commission of India, has promoted concentration rather than (fair) competition, and in doing so it has failed to capture the anticompetitive ramifications of some of the fundamental features of the online platforms, namely indirect network effects, vertically integrated structure and deep discounting funded by their access to deep pockets. Further, this paper also draws attention to the issue of making predatory conduct such as predatory pricing investigable only in the case of the ‘Abuse of Dominance’ by a firm, especially when this dominance is subjectively assessed.

The Competition Act 2002 (hereafter, CA 2002) aims at sustaining and promoting competition in markets within India. The introductory paragraph of the Act lays down its aim as:

“An Act to provide, keeping in view of the economic development of the country, for the establishment of a Commission to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carried on by other participants in markets in India, and for matters connected therewith or incidental thereto” (Competition Act 2002).

The CA 2002[i] replaced the Monopolies and Restrictive Trade Practices Act (hereafter, MRTPA) 1969. The MRTPA 1969 was primarily “an anti-monopoly legislation” (Singh 2000) whose stated objective was-

“ to ensure that the operation of the economic system does not result in the concentration of economic power to the common detriment and to prohibit such monopolistic and restrictive trade practices as are prejudicial to public interest” (Monopolies and Restrictive Trade Practices Act 1969).