Q. Discuss the role of the Competition Commission of India in containing the abuse of dominant position by the Multi-National Corporations in India. Refer to the recent decisions.

Model Answer: 

Competition Commission of India

Competition Commission of India (CCI) is a statutory body established under the Competition Act, 2002, to prevent practices that have an adverse effect on competition, to promote and sustain competition, to protect the interests of consumers and to ensure freedom of trade in the markets of India. The CCI plays a pivotal role in containing the abuse of dominant position by Multi-National Corporations (MNCs) in India. It has the power to investigate and penalize MNCs that abuse their dominant position, thereby ensuring fair competition and preventing anti-competitive practices.

Role of CCI in Containing Abuse of Dominant Position

1. Investigation and Enforcement: The CCI has the authority to investigate MNCs suspected of abusing their dominant position in the market. If a company is found guilty of such practices, the CCI can impose penalties, issue cease and desist orders, and even order the division of the company in extreme cases.

2. Regulation of Mergers and Acquisitions: The CCI has the power to regulate mergers and acquisitions that could potentially lead to an abuse of a dominant position. It ensures that such consolidations do not create an unfair competitive advantage or lead to monopolistic practices.

3. Advocacy and Awareness: The CCI conducts advocacy and awareness programs to educate businesses about competition laws and the consequences of their violation. This helps in preventing the abuse of a dominant position by MNCs.

4. Market Studies: The CCI conducts market studies to understand the competitive dynamics of the market, identify anti-competitive practices, and take necessary actions to prevent abuse of dominant position.

Recent Decisions

1. Google Case: In 2018, the CCI imposed a fine of $21.1 million on Google for abusing its dominant position in the online web search and advertising markets. The CCI found that Google was giving its own online airline flight search product an unfair advantage by placing it prominently on the search results page.

2. Maruti Suzuki Case: In 2019, the CCI ordered an investigation into Maruti Suzuki for allegedly abusing its dominant position by forcing dealers to limit the discounts they offered, thereby stifling competition.

3. Amazon & Flipkart Case: In 2020, the CCI ordered a probe into alleged anti-competitive practices by Amazon and Flipkart. The CCI noted that the exclusive arrangements between smartphone brands and e-commerce platforms could potentially lead to an abuse of a dominant position.

Conclusion

The Competition Commission of India plays a crucial role in maintaining a level playing field in the Indian market by preventing MNCs from abusing their dominant position. It ensures that businesses operate in a fair and competitive environment, which ultimately benefits the consumers. The CCI’s proactive approach in investigating and penalizing companies that violate competition laws is instrumental in deterring MNCs from engaging in anti-competitive practices.