Which Section of Competition Law 2002 Mentions about Anti-Competitive Agreements

Competition law is a set of regulations that aims to promote fair competition in markets and prevent anti-competitive practices. The Competition Act, 2002, is the primary legislation governing competition law in India. This Act covers a wide range of topics, including anti-competitive agreements, abuse of dominant position, and the regulation of combinations (mergers and acquisitions). In this article, we will focus on which section of the Competition Act, 2002 mentions about anti-competitive agreements.

Section 3 of the Competition Act, 2002 deals with anti-competitive agreements. This section prohibits and declares void any agreement between enterprises or persons that causes or is likely to cause an appreciable adverse effect on competition within India.

An agreement between enterprises can take many forms, including contracts, arrangements, or understandings. For an agreement to fall within the scope of Section 3, it must have the effect of:

1. Directly or indirectly determining purchase or sale prices

2. Limiting or controlling production, supply, markets, technical development, investment, or provision of services

3. Sharing the market or source of production or provision of services by allocating customers, territories, or any other similar way

4. Rigging bids or collusive bidding

5. Imposing or practicing conditions that are not directly related to the goods or services being traded.

If any of the above conditions are met, the agreement will be deemed anti-competitive and in violation of Section 3 of the Competition Act, 2002. The prohibition applies to both horizontal agreements (between competing firms) and vertical agreements (between firms at different levels of the supply chain).

The term “appreciable adverse effect on competition” is significant in understanding the scope of Section 3. This term refers to any conduct that harms competition in a market significantly. The Competition Commission of India (CCI) has been entrusted with the responsibility of determining whether an agreement has an appreciable adverse effect on competition.

If the CCI determines that an agreement is anti-competitive, it may impose penalties on the parties involved, including fines of up to 10% of the turnover from the relevant market. The CCI may also pass orders directing the parties to modify or terminate the agreement.

In conclusion, Section 3 of the Competition Act, 2002 prohibits anti-competitive agreements between enterprises that have an appreciable adverse effect on competition in India. The Act aims to promote fair competition in markets and prevent anti-competitive practices that can harm consumers and the economy. As a professional, it is important to ensure that any content related to competition law and Section 3 of the Competition Act, 2002 is accurate and up-to-date, and uses relevant keywords to enhance its visibility on search engines.

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