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Prohibition Of Anti Competitive Agreements

Companies involved in anti-competitive behaviour may consider their agreements to be unenforceable and may face fines of up to 10% of the group`s global turnover and possible actions for damages. Chapter 2, Article 1 of the Competition Act, provides five examples of particularly anti-competitive cooperation. This list is not exhaustive. There may be other forms of anti-competitive cooperation. The exemption for anti-competitive agreements is not compliant. However, a dominant undertaking can demonstrate that it has an objective justification for abusive behaviour in other circumstances. Horizontal agreements are agreements between companies at the same level of the production chain, which is usually between two competitors, either to consolidate prices, to limit production, or to divide markets. In all these agreements, there is a presumption in the law that such agreements are the origin of AAEC. The cartel is also a horizontal agreement. This is usually done between producers of goods or service providers for pricing or market distribution and is generally considered the most damaging form of anti-competitive agreements.

Article 19, paragraph 1 of the Act provides that, in the event of payment of the fees and the prescribed terms, the ICC may request any alleged violation of Section 3 (1) of the Act itself or in the case of receiving information from individuals, consumers or their association or professional association. The ICC may also act when the central government or a state government or legal authority refers to it. The ICC only continues the investigation in cases of prima facie and then orders the Director General to open an investigation into the matter. In cases where, as a result of an investigation, the ICC finds that the agreement is anti-competitive and has an AAEC, it may take any of the following injunctions, with the exception of the injunctions it may take under section 33 of the Act: given this power of the ICC, it becomes essential that the parties operating in India be aware of the agreements that can be considered “anti-competitive”. In this newsletter, we will discuss the situations and conditions under which an agreement may become anti-competitive.

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