Professional Documents
Culture Documents
September-October, 2010
September-October, 2010
Continuing with our efforts to update you with • Bombay High Court dismisses writ petition
filed by Aamir Khan Productions
the latest developments in competition law, we
• CCI passes orders on closure of certain
are happy to present this annual edition of our matters
bulletin on completing the first year of its
• Media Updates
publication.
• Competition Appellate Tribunal decides
Competition law jurisprudence is slowly more pending MRTP matters
First issue that was framed was whether a direction passed Sixth and the last issue that framed was with respect to the
by the Commission u/s. 26(1) of the Act while forming directions, if any, which the court had to issue for ensuring
prima facie opinion would be appealable u/s 53A(1) of the proper compliance of the procedural requirements while
Act. The Court concluded in negative and held that Section keeping in mind the scheme and object of the Act. The Court
53A (1) of the Act expressly provides decisions or orders or directed that (i) all proceedings, including investigation and
directions may be appealed before COMPAT, and this does inquiry be completed by CCI/ DG most expeditiously and
not include a direction of CCI under Section 26(1) of the wherever during a course of an enquiry the CCI passes an
Act. The Court noted that right to appeal is a statutory right interim order, It should pass a final order in that behalf as
and if the statute does not provide for an appeal, the Court expeditiously as possible and in any case not later than 60
cannot presume such right. days; and (ii) DG should submit the report in terms of
section 26(2) of the Act within the time as directed by CCI,
Second issue that was framed was whether the opposite
but in all cases not later than 45 days from the date of the
parties are entitled to notice at the stage of formation of
directions issued under section 26(1) of the Act.
prima facie opinion and whether it is obligatory for the CCI
Bombay High Court dismisses writ petition filed by entered into an agreement with
Aamir Khan Productions the Government of India and in
pursuance of which an Office
The Bombay High Court by its
Memorandum (OM) was issued
judgment dated August 18, 2010
by the Ministry of Finance, to all
has dismissed the writ petition
government departments with
filed by Aamir Khan Productions
directions to purchase all travel
Pvt. Ltd. against the show cause
tickets from opposite parties only. It was alleged by
notice issued by CCI under
Informant that the above action and conduct of the
section 26(8) of the Act for conducting final inquiry into the
Government of India involving opposite parties is also an
allegation found to be correct in the investigation report of
abuse of dominant position and has resulted in denial of
the DG (for forming a cartel of film producers against the
market access to travel agents fraternity at large. CCI after
multiplex owners and taking a decision of not screening
considering all the allegations noted that Central
movies at multiplexes) on the ground that CCI did not have
Government officials were free to procure air ticket directly
jurisdiction to initiate proceedings under the Act in respect
from any airline or through Internet for official (domestic)
of films for which provisions of the Copyright Act, 1957
visits. It is only when an official wanted to utilize the
contain exhaustive provision. The Court held that there is
services of travel agents it was limited to the opposite
nothing in the Act to indicate that CCI is not vested with the
parties, who were also required to ensure that the
jurisdiction and CCI has the jurisdiction to decide the
procurement of the ticket should be on the best bargain
question whether or not it has jurisdiction in respect of
across all airlines. Furthermore, the CCI also held that the
films under the Copyright Act, 1957, particularly, when the
Government of India was not an enterprise and dismissed
matter is still at the stage of further inquiry with decision
the case.
yet to be taken by CCI. Mere issuance of a show cause
notice under section 26(8) of the Act cannot be treated as (Case No. 39/2010 - Travel Agents Association of India vs.
pre-judging the issue. Balmer Lawrie & Co. Ltd. & Anr, New Delhi)
• Offer consumers an immediate discount or rebate or a (Source- The Live Mint, September 7, 2010-
free or discounted product or service for using a http://www.livemint.com/articles/2010/09/06211337/South-
particular credit card network, low-cost card within African-body-accuses--Ap.html?atype=tp )
that network or other form of payment; Czech Republic: Highest-ever fine for a vertical
• Express a preference for the use of a particular credit agreement
card network, low-cost card within that network or The Office for the Protection of Competition (the Office) of
other form of payment; the Czech Republic, vide an order dated September 15,
• Promote a particular credit card network, low-cost 2010 imposed a fine of CZK 17.283 million on the coal
card within that network or other form of payment producing company Sokolovská uhelná, právní nástupce,
through posted information or other a.s. for entering into anti-competitive agreements with its
communications to consumers; and customers whereby the customers of Sokolovská uhelná
committed not to export brown coal and brown coal
• Communicate to consumers the cost incurred by the
briquettes outside the Czech Republic or to trade in it so as
merchant when a consumer uses a particular credit
to enable such export. The agreements on export
card network, type of card within that network, or
prohibition are perceived as significant distortion of
other form of payment.
competition by both Czech and European law. The aim of
Understandably, the American Express has not agreed to these agreements was distortion of competition, thus there
the proposed settlement and the antitrust law suit is was no need in proving the negative impact on
pending against it. competition. By means of agreements on export
(Source-US Department of Justice Website, October 4, 2010, prohibition the supplier could have divided the common
http://www.justice.gov/opa/pr/2010/October/10-at-1115.html) market and thus contributed to closing of a market for
competitive goods in the framework of the same brand.
Thus the agreements under consideration led to decrease exclusive agreements with these outlets made it difficult
in the number of customers which could have exported the for competitors to establish a competing national network
goods bought from the party to the proceedings. On the for parcel delivery. The authority found that Posten Norge,
basis of the agreements on export prohibition the through this network of exclusive agreements, had abused
customers were limited in their choice of the end customer its dominant position in the market for the distribution of
which could have led to decrease in the offer for customers. parcels from mail order and e-trade companies to
In its decision, the Office stated that the infringement of Norwegian consumers. Without these exclusive
both the Czech Act on the Protection of Competition and agreements, the authority found that competing providers
Article 81 of the EC Treaty (now Article 101 of the TFEU), of delivery services would have been able to compete more
because of the mentioned agreements could have effectively and the prices for parcel delivery services could
influenced trade among the EU Member States. have been lower, to the benefit of both mail order and e-
trade businesses and, ultimately, Norwegian consumers.
(Source- Czech Republic Office of Competition Website,
September 15, 2010 http://www.compet.cz/en/competition/ (Source: International Law Office Competition Newsletter –
news-competition/chairman-rafaj-confirmed-fine-for- September 23, 2010 available at
sokolovska-uhelna-company/ ) www.internationallawoffice.com)
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Editor: M M Sharma
Editorial Team: Vinay Vaish, Satwinder Singh, Shruba Bhattacharya, Vaibhav Choukse
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