Anti-Competitive Agreements

UK competition law and EU competition law prohibit two main types of anti-competitive activities: the law aims to prevent the practices of parties who have AAEC in India. This can guarantee free trade and would protect the interests of all parties, including consumers. However, such an objective could only be achieved if the parties doing business followed the principles set out in the law. For parties doing business in India, it is important to monitor the maintenance of anti-competitive elements in agreements between them. Companies should be proactive and conscientiously tasked with identifying existing anti-competitive elements arising from their current agreements. Staff can be trained to understand and avoid the effects of anti-competitive agreements. If necessary, people and companies can always call on experts who can lead them to a safer option. Cartels are the most serious form of anti-competitive agreements and their continuation is a priority in many legal systems. There is a cartel when undertakings agree to act jointly, to control prices and to prevent new competitors from entering a given market.

This is to benefit the cartel members while maintaining the illusion of competition. Anti-competitive agreements are agreements between competitors aimed at preventing, restricting or distorting competition. Section 34 of the Competition Act prohibits anti-competitive agreements, decisions and practices. The risks associated with an anti-competitive agreement or the abuse of a dominant position are serious. In addition to the aforementioned consequences, another risk for businesses is the disruption and deterioration of a company`s reputation resulting from lengthy investigations or subsequent disputes of customers, competitors and consumers, as well as significant legal costs and administrative time. The Section provides for a derogation from joint ventures received by the Parties where they increase the efficiency of the production, supply, distribution, storage, acquisition or control of goods or the provision of services. Article 3(1) of the Law cannot be relied on independently and must necessarily be used in conjunction with Article 3(3) as regards horizontal agreements or Section 3(4) as regards vertical agreements. It should be clarified, however, that Article 3(1) is not only a suggestive provision, but is essentially the `kind` of the law. It should also be invoked independently to serve the interests of consumers and also cover various other types of agreements that might not fall under the aegis of Article 3(3) or Article 3(4). There is no equivalent exemption for anti-competitive agreements. However, in certain circumstances, a dominant undertaking may demonstrate that it has an objective justification for abusive conduct.

Vertical agreements exist between companies at different stages of the production chain, such as an agreement between the manufacturer and a distributor. The presumption rule does not apply to vertical agreements. Whether the vertical agreement caused AAEC is determined by the rule of reason. If the rule of reason is applied, the positive and negative effects of competition will be analysed. In order to determine whether an agreement is contrary to Article 3(4), in conjunction with Article 3(1) of the Law, the following five essential elements of Article 3(4) must be fulfilled: in order to reach an agreement or conclude an agreement, it is not necessary to write anything. . . .