New Scheme by CCI to Fight Cartels- A new initiative by the Competition Commission of India (CCI) aims to tackle cartels more effectively. Under this scheme, companies involved in cartel activities can now report other cartels and receive reduced penalties.
The leniency-plus regime, as it’s called, offers significant benefits to companies willing to cooperate. Penalties for involvement in the first reported cartel can be reduced by up to 30%. For newly-disclosed cartels, penalties can be slashed by up to 100%. The extent of reduction depends on the evidence provided by the reporting company.
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This move comes after the Ministry of Corporate Affairs (MCA) issued a notification, stating that the regime would be effective from February 20. The initiative, proposed under the Competition (Amendment) Act 2023, signifies a shift towards a more stringent framework to combat anti-competitive practices.
The implementation of this leniency-plus scheme marks a significant step in the fight against cartels in India. By incentivizing companies to come forward with information about illegal collusion, authorities hope to uncover and dismantle such anti-competitive practices more efficiently.
Under the new regulations, companies facing investigations for cartelization now have a pathway to mitigate their penalties by cooperating with the authorities. This could lead to a greater level of transparency within industries and discourage firms from engaging in collusion to manipulate markets or fix prices.
The leniency-plus regime underscores the government’s commitment to promoting fair competition and protecting consumer interests. It reflects a proactive approach to addressing economic challenges and fostering a level playing field for businesses in the country.
With the new framework in place, the CCI aims to create a more robust regulatory environment that encourages compliance and discourages anti-competitive behavior. By offering incentives for cooperation, the authorities seek to root out cartels and ensure fair and open competition across various sectors of the economy.
