New CCI chief says no ground for sectoral exemptions

New CCI chief says no ground for sectoral exemptions

"The fundamental premise of competition law is that any commercial activity has to be in the purview of competition law. There is no ground for exemption, then the whole purpose is diluted," Chawla told PTI.

Some sectors, like shipping and pharma, have for long been seeking exemption from the Competition Commission of India's (CCI) purview. With the Banking Amendment Bill coming in place, the banking sector would be kept out of the CCI jurisdiction.

Chawla said the exemptions should only be given to sensitive sectors like defence, atomic energy and, coins and currencies.

"Where even the state discharging functions are commercial in nature, for example the oil companies and parts of the railways, those logically cannot be exempted. So, those proposals if they are there, they are basically non-starters given the architecture," he added.

Section 54 of the Competition Act 2002, grants the government the power to exempt a sector from the purview of the CCI, not only relating to mergers and acquisition norms, but also gives immunity from any probe into allegations of anti-competitive agreement and abuse of dominant position.

The CCI is empowered by an act of Parliament to look into anti-competitive agreements and abuse of dominant market position by market players. Also, the CCI has the power to scan and approve high value mergers and acquisitions (M&As).

The commission was established in 2003 to replace the erstwhile Monopolies and Restrictive Trade Practices Commission. Dhanendra Kumar was appointed its first Chairman in February 2009, after which it became fully functional.

Chawla has taken charge as the second Chairman of CCI. The appointment assumes significance as after June 1, all high value M&A deals have come under the CCI purview.

A Gujarat-cadre IAS bureaucrat of 1973 batch, Chawla retired as Finance Secretary on
January 31. He was heading a committee on allocation, pricing and utilisation of natural resources till recently.

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