DEREGULATION AND PRIVATISATION

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GREETINGS TO CHARTERED ACCOUNTANTS FOR ICAIS
POST QUALIFICATION COURSE VIDEO CONFERENCE FROM
HYDERABAD 25 AUGUST 2005
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MRTP ACT, 1969 THE OUTGOING INDIAN COMPETITION
LAW Dr. S. CHAKRAVARTHY (Profession Civil
Servant) Formerly, Member, Monopolies and
Restrictive Trade Practices Commission, Member,
High Level Committee on Competition Policy
and Law And Member of Committee for Drafting the
Law. Presently, Adviser/Consultant Competition
Policy and Law HYDERABAD, INDIA

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LPG - PRE 1991 REGIME

• LICENSING
• PLANNING
• GOVERNMENT CONTROL

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LPG POST 1991 REGIME

• RECENT POLICY CHANGES FROM 1991 ONWARDS
  INCLUDE
• DEREGULATION AND SIMPLIFICATION OF LICENSING
  AND
• APPROVAL PROCEDURES
• EXEMPTION OF A LARGE NUMBER OF INDUSTRIES FROM
• LICENSES, APPROVALS AND QUOTAS
• NEW ECONOMIC ADJUSTMENT MEASURES
• DIVESTITURE AND SALE OF GOVERNMENT ASSETS
• GRADUAL DECLINE IN THE INTERVENTIONIST ROLE OF
  THE
• PUBLIC SECTOR
• PRIVATISATION
• ENCOURAGING COMPETITION

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MONOPOLIES AND RESTRICTIVE TRADE PRACTICES ACT,
1969

• A. LODE STAR
• CONSTITUTION OF INDIA - DIRECTIVE PRINCIPLES OF
• STATE POLICY

• B. PRINCIPLES
• SOCIAL JUSTICE WITH ECONOMIC GROWTH
• WELFARE STATE
• REGULATING CONCENTRATION OF ECONOMIC POWER TO
• THE COMMON DETRIMENT
• CONTROLLING MONOPOLISTIC, UNFAIR AND
  RESTRICTIVE
• TRADE PRACTICES

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THRUST AREAS

• REGULATION OF CONCENTRATION OF
• ECONOMIC POWER
• COMPETITION LAW
• CONSUMER PROTECTION

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MONOPOLY - A CONCEPT OF POWER TO

• CONTROL PRODUCTION, SUPPLY ETC
• CONTROL PRICES
• PREVENT, REDUCE OR ELIMINATE COMPETITION
• LIMIT TECHNICAL DEVELOPMENT
• RETARD CAPITAL INVESTMENT
• IMPAIR THE QUALITY OF GOODS

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DOCTRINES GUIDING THE ACT
BEHAVIOURAL DOCTRINE CONDUCT OF ENTITIES,
UNDERTAKINGS AND BODIES TO BE ASCERTAINED. TRADE
PRACTICES, DETRIMENTAL TO PUBLIC INTEREST TO BE
TESTED
REFORMIST DOCTRINE DIRECTION TO DISCONTINUE OR
NOT TO REPEAT THE UNDESIRABLE TRADE PRACTICE. ADV
ISORY
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RESTRICTIVE TRADE PRACTICES

• REFUSAL TO DEAL
• TIE-UP SALES
• FULL LINE FORCING
• EXCLUSIVE DEALINGS
• CONCERT OR COLLUSION -- CARTELS
• PRICE DISCRIMINATION
• RE-SALE PRICE MAINTENANCE
• AREA RESTRICTION
• PREDATORY PRICING

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UNFAIR TRADE PRACTICES

• MISLEADING ADVERTISEMENT AND FALSE
  REPRESENTATION
• BARGAIN SALE, BAIT AND SWITCH-SELLING
• OFFERING OF GIFTS AND PRIZES WITH THE
  INTENTION OF
• NOT PROVIDING THEM
• PRODUCT SAFETY STANDARDS
• HOARDING OR DESTRUCTION OF GOODS
• DISPARAGING GOODS, SERVICES OR TRADE OF
  COMPETITORS

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MONOPOLISTIC TRADE PRACTICES

• MAINTAINING PRICES OF GOODS AT UNREASONABLE
  LEVELS BY
• LIMITING, REDUCING OR CONTROLLING PRODUCTION,
  SUPPLIES ETC
• UNREASONABLY PREVENTING OR LESSENING
  COMPETITION
• LIMITING TECHNICAL DEVELOPMENT OR CAPITAL
  INVESTMENT OR
• ALLOWING QUALITY TO DETERIORATE
• INCREASING UNREASONABLY THE COST OF PRODUCTION
• OR CHARGES
• INCREASING UNREASONABLY THE PRICES OF GOODS OR
  PROFITS

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DOMINANCE

• INTER-CONNECTION BETWEEN UNDERTAKINGS
• ABUSE OF MARKET POWER
• MERGER AND AMALGAMATION

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APPLICABILITY OF THE MRTP ACT

• ALL UNDERTAKINGS ENGAGED IN MANUFACTURE,
  SUPPLY
• AND DISTRIBUTION IN THE PRIVATE SECTOR
• PUBLIC SECTOR UNDERTAKINGS OWNED BY THE
  GOVERNMENT
• OR GOVERNMENT UNDERTAKINGS
• STATUTORY CORPORATIONS
• UNDERTAKINGS UNDER THE MANAGEMENT OF
  CONTROLLERS
• APPOINTED BY LAW
• COOPERATIVE SOCIETIES
• FINANCIAL INSTITUTIONS, BANKS

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MRTP COMMISSION

• THE AUTHORITY OF THE COMMISSION INCLUDES THE
  POWER
• TO DIRECT AN UNDERTAKING TO DISCONTINUE A TRADE
  PRACTICE
• TO PASS A CEASE AND DESIST ORDER
• TO GRANT TEMPORARY INJUNCTION
• TO AWARD COMPENSATION
• TO DIRECT PARTIES TO AGREEMENTS TO MODIFY THE
  SAME
• TO DIRECT PARTIES TO ISSUE CORRECTIVE
  ADVERTISEMENTS
• TO RECOMMEND TO CENTRAL GOVERNMENT, DIVISION
  OF
• UNDERTAKINGS OR SEVERANCE OF
  INTER-CONNECTION BETWEEN UNDERTAKINGS

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INVESTIGATION AND ENQUIRIES

• ACTION CAN BE INITIATED BY
• AN INDIVIDUAL CONSUMER
• A REGISTERED ASSOCIATION OF CONSUMERS
• A TRADE ASSOCIATION
• DIRECTOR GENERAL, INVESTIGATION REGN
• GOVERNMENT
• MRTP COMMISSION SUO MOTU

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COMPETITIVE ADVANTAGE

• PARADOXICALLY, THE ENDURING COMPETITIVE
  ADVANTAGES IN A GLOBAL ECONOMY LIE INCREASINGLY
  IN LOCAL THINGS KNOWLEDGE, RELATIONSHIPS AND
  MOTIVATION THAT DISTANT RIVALS CANNOT MATCH.
• MICHAEL E. PORTER

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THANK YOU FOR YOUR KIND ATTENTION