New Delhi: To strengthen its extra-territorial jurisdiction, the Competition Commission of India (CCI) is entering into cooperation agreements with its counterparts in other nations.
Extra-territorial jurisdiction relates to acts that take place outside the country but have an effect on competition in India.
India’s competition watchdog is close to signing a memorandum of understanding (MoU) with the US Federal Trade Commission’s Bureau of Competition, said a CCI official with direct knowledge of the development.
A draft MoU was prepared in November and is awaiting the foreign ministry’s approval.
The regulator signed a similar pact with Russia’s Federal Anti-Monopoly Service in December, another official said.
An email sent to the international cooperation division of the Russian agency on Tuesday remained unanswered.
“These pacts are crucial in order to bolster CCI’s extra-territorial jurisdiction, and come in handy when cases involving multinational companies are brought before us,” the CCI official said, requesting anonymity.
Such jurisdiction is governed by Article 32 of the Competition Act, 2002. The Act, last amended in 2007, governs the functioning of CCI. All international pacts are facilitated by the foreign ministry.
Under Article 32 of the Act, CCI can inquire into any matter where there is an allegation of abuse of dominant position by a company or entity even if the agreement was entered outside India or either party is based outside India, as long as the case has a bearing on competition in India.
CCI is in advanced talks with China’s Anti-Monopoly Bureau and has had discussions with the Competition Commission of South Africa, Indonesia’s Commission for Supervision of Business Competition, the Japan Fair Trade Commission, the Office of Fair Trading of the UK, and Brazil’s Conselho Administrativo de Defesa Econômica, the CCI officials said.
Moreover, under the proposed free trade agreement between India and the European Union (EU), there is an entire chapter on competition law which will serve as a de facto agreement with the director general for competition of the European Commission, the umbrella competition watchdog of the EU.
Anand Pathak, a New Delhi-based competition lawyer said internationally, the most comprehensive of such agreements are those signed between the US and the EU. “There have been several cases in which the US and the EU have together gone after multinational companies. In fact, soon after one party initiates proceedings, the other follows suit,” he said. Pathak, however, said such pacts would help only if they are comprehensive and do not remain mere MoUs.
The international agreements come even as CCI is fighting a turf battle at home.
The telecom ministry and the financial services department are asking for their respective sectors to be kept outside CCI’s purview, whereas the corporate affairs ministry is finalizing a cabinet note that seeks to bring all sectors of the economy under the regulator’s watch.
Corporate affairs minister M. Veerappa Moily, though, said on 12 June that the competition watchdog will not infringe on the turfs of other sectors.