Thread by @barandbench

Karnataka HC to shortly begin hearing two petitions moved by Amazon and flipkart seeking to quash the probe ordered by the Competition Commission of India (CCI) against them for alleged violations of Competition Law.

@Flipkart
@amazonIN
@CCI_India

To find out what happened yesterday, follow this thread

https://twitter.com/barandbench/status/1364897662860881922?s=19

ASG Madhavi Divan will continue making arguments on behalf of CCI today.

Matter begins.

Divan: I want to address the Court on certain provisions of the Competition Act.

I want to dispel some fundamental flaws (pertaining to the Competition Act) raised by the Other side.

Divan: Competition Act brought in to create level playing field. We want more players. That will help in having better choice for customers, healthy competition, better efficiency etc:

In this light, it is duty of CCI to maintain purity of Competition, as I mentioned yesterday

Divan now reads the objects and reasons of the Competition Act

Divan: An Act, keeping in view of the economic development of the country, was laid
down to provide for an establishment of a commission with the following object:
-to prevent practices having adverse effect on competition,
-to promote and sustain competition in markets...

......-to protect the interests of consumers,
-to ensure freedom of trade carried on by other participants in markets in India and
-for matters connected therewith or incidental thereto...

This are the objectives of the Act, milord: Divan

Defn of Agreement under Section 2(b) of the Competition Act is loosely worded as opposed to other legislations, particularly Contract Act: Divan

Divan: Defn of Consumer in the Competition Act is wider. It is meant to protect end consumer as well as a retailer or a manufacturer.

Divan: If small players, small retailers and manufacturers, if they are pushed out, then end consumer will not have the requisite choice...

Divan: When a big player comes and gives a discount, it is an investment for them.

Studies show that these big players incur the losses for that time and push the smaller players out. They won't get visibility later.

So when there is deep discounting, one has to be alert. What is the reason for this?

So the point that if prices are low, people will benefit is wrong. Saying that CCI should not interfere is not appropriate: Divan

This change was appreciated by even foreign jurisdictions only recently: Divan

Divan refers to judgements to show how definition of consumer is wider under the Competition Act as compared to the Consumer Act.

Under the COPRA, it seeks to protect end consumer from wholesalers, retailers, manufacturers etc..

Whereas under Competition Act, it means to say that more players are better eventually even for the end consumer: Divan

Competition Act is an economic legislation: Divan

Competition Act lays down rules of the game. Maintains level playing field for all players...tackles anti competitive agreements: Divan reads from a judgment

In the wake of Liberalisation and Gloabalisation, the need for the 2002 Act was all the more necessary: Divan quotes a judgment

Divan: Section 16 of the Act on appointment of Director General is important. DG is the expert investigator in investigation related to competition violators.

They are persons of outstanding integrity, experts in matters related...

Like I mentioned yesterday, when we receive info on violations, do we shut the field or conduct a fact finding exercise: Divan

Divan is now dealing with S 33: Power to issue interim Orders.

What is a prima facie case?

There are different thresholds that this Act itself gives, Divan adds.

This is a temporary injunction amid an inquiry: Divan.

She now reads Section 36.

Divan reads sections 44 and 45.

There is a hefty fine of one crore for false information by informant. But we first DG analyzes the information and then we reach a conclusion.

Orders under Sec 26 (1) not appealable. That was intention of legislature: Divan

Divan: Now, section 26, milord. Is it alright if I continue? I can do it in the next hearing as there are judgments.

Justice PS Dinesh Kumar: Alright. Tomorrow then

Divan: Is Saturday alright, milord?

Justice Kumar: Sorry.... Monday.

Divan: Can it be Tuesday milord? There's a part heard matter...

Justice Kumar: Yes yes. Tuesday

Matter adjourned to March 2