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PRESS TRUST OF INDIA
NEW DELHI, July 23: Department of Company Affairs (DCA) will soon approach the law ministry for permission to form a committee to review the Monopolies and Restrictive Trade Practices (MRTPC) Act and bring about a new competition law, a top government official said here on Friday.
Since the model code of conduct was already in operation due to the ensuing elections, the department would first seek the law ministry's opinion, DCA secretary T S Krishnamurthy told reporters after attending a workshop on Competition Law organised by Associated Chambers of Commerce and Industry of India here.
"We would like to have five or six members on this committee from related areas like legal field, academics, corporate law and company affairs," Krishnamurthy said. Finance Minister Yashwant Sinha in his 1999-2000 budget speech had said that a new competition law would be formulated in view of the inadequacies of the MRTPC Act to cope with the latest international economic developments relating to competition laws. Thecommittee would also look into the necessity of bringing mergers, amalgamation and acquisitions under the purveiw of the new law, Krishnamurthy said.
At present, mergers and amalgamations take place under the Companies Act and the MRTPC has no jurisdiction to examine the possibility of a monopoly resulting from a merger. The problems of too many regulators with overlapping jurisdiction would also be considered by the committee on competition law, Krishnamurthy said in his address. "Maintenance of competitive environment and supervision of regulators will be another aspect that this committee will look into," he added. In this respect, he pointed out that Sweden had a competition Ombudsman to supervise all regulatory bodies and ensure a proper competitive environment.
The new competition policy would also have to be aligned with other government policies to ensure that it did not work against the basic objectives of competition policy and balanced economic growth, he said. In his address, Assochampresident K P Singh said a new competition commission with more powers than the present Monopolies and Restrictive Trade Practice Commission should be established and deterrent punishment should be awarded for contravention of its provisions.
"The adverse impact of reduction in the number of players in the market, discouragement of new entrants in the market, dictation of prices by the large merged undertakings and the exercise of dominance by the merged entities will have to be addressed by the new competition law," he added.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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