Cartel is thorn of growing Economy

Competition law, known more popularly as anti-trust laws, are the Magna Carta of free enterprise. They are important to the preservation of economic freedom and our free-enterprise system. The regulatory authorities of every country in the world today are involved in using its resources to detect cartels and their egregious effect on market. The group formed on the basis an Anti-competitive agreement as per Sec 3 of Competition Act 2002 to have appreciable adverse effect in the market can be understood as Cartel. The Concept of cartel is since ages. Cartels are however secret by definition and the antitrust authorities need to dedicate a great deal of effort to discover, ascertain and deter them. Most of the time due to lack of evidence, no action can be taken against a cartel even though the commission has its knowledge. The efforts to detect cartels have been strengthened significantly by the use of the leniency programmes. Leniency as the name itself suggests, denotes a total or partial exemption from the penalties which would otherwise be imposed to the member of a cartel who reveals its cartel membership to an enforcement agency. However, the word Cartel has been defined u/s 2(c) of Competition Commission of India as “cartel” includes an association of producers, sellers, distributors, traders or service providers who, by agreement amongst themselves, limit control or attempt to control the production, distribution, sale or price of, or, trade in goods or provision of services. The Cartel is considered to be Civil wrong but whosoever doesn’t comply with the Commission order, then it may lead to criminal offence. This provision is applicable on individual and companies, both. All the sectors come under this provision until and unless the government doesn’t come up with the specific notification of exemption. The Provision for leniency has given u/ 46 of Competition Commission of India, which says:- The Commission may, if it is satisfied that any producer, seller, distributor, trader or service provider included in any cartel, which is alleged to have violated section 3, has made a full and true disclosure in respect of the alleged violations and such disclosure is vital, impose upon such producer, seller, distributor, trader or service provider a lesser penalty as it may deem fit, than leviable under this Act or the rules or the regulations. An international organization namely “Organization for Economic Co-operation and Development (OECD) also talks about Cartels and it says that it harms the consumers in many countries. They limit the output, regulate the price of their own and transparency is always questionable. We hold the view that there must be stringent punishment, if someone breaches this provision. Even the amount of fine must be hefty. We hope, we have better and healthy economic market soon.

(The writer is Sumit Kumar, Partner, SSP Partners-Advocates & Associates and Nishikant Bibhu , Faculty, Galgotia University, Greater Nodia)

Disclaimer:- The present blog is for information purposes and writers have shared their views in their individual capacity. The Content of the blog won't be taken as legal opinion.One need to take legal advice before you act on any information or view expressed herein. This blog is not an attempt to solicit business in any manner whatsoever.

Posted on - 2020-05-19 21:26:32

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