By- Anshika Rana & Mehul Khanna, UG Law Students, MAHARAJA AGRASEN INSTITUTE OF MANAGEMENT STUDIES (GGSIPU)
ABSTRACT
This paper analyzes the evolution and development of the Competition Law from its history to its present legal regime in India. It analyses the history of the growth of Competition law right from the ancient times, provisions made in the legislations of different countries and the effect of world development on the contemporary legislation. This paper also analyzes the history of Competition law in India and further moves ahead to analyze objectives and legal framework of Competition Act 2002 with special focus on Anti-Competitive Agreements under Section 3 of the Act. The objective of this paper is to understand the legal regime of Vertical and Horizontal Agreements.
INTRODUCTION
Competition law is also referred to as antitrust law in the US and anti-monopoly law in China and Russia and it seeks to promote competition in markets for the benefit of consumers through regulation of anti-competitive behavior. Up until the mid-20th century there were only fewer than ten competition laws worldwide.” Eventually, in the late 19th century, there were cases of competition laws being applied globally. “Globalization of the modern economy requires a strong legal regime to provide for fair competition at the international level. The competition law provides this by preventing the anticompetitive behavior like cartels, mergers with the negative impact on competition, abuse of dominance in the market. Despite the constant goals of the competition law in all jurisdictions, there are certain differences in their application and philosophy. The competition law is recognized worldwide as one of the key factors of economic growth, innovation, and consumer protection. Being aware of the importance of this concept, the jurisdictions worldwide have introduced the competition law.”
EVOLUTION OF COMPETITION LAW
The history of the competition law dates back to ancient Greece and Rome, where laws were enacted to control the act of hoarding and price manipulation; grain dealers were fined for artificial shortages of goods. In medieval Europe, trading laws and royal decrees controlled trade in order to protect the interests of the producers and not the consumers. In 1624, the Statute of Monopolies which was passed in England as a measure to restrict the power of the Crown to award monopoly privileges. Monopoly privileges were to be awarded to actual inventors for a period only. The nineteenth-century Industrial Revolution era experienced the emergence of cartels and trusts. Cartelization took place at a fast pace during this time, leading to the consolidation of economic power among a few companies. In the United States, the Sherman Antitrust Act, 1890 It was enacted as the first statute of major significance to deal with competition law issues. It outlawed contracts, combinations, monopolies, and conspiracies in restraint of trade.
The next important legislation was the Clayton Act, 1914, which was enacted to deal with price discrimination and tie-in agreements. It made certain acquisitions and business practices illegal if these practices were capable of creating monopolies or lessening competition.It was followed by the Federal Trade Commission Act, 1914, which created the Federal Trade Commission and authorized it to control the unfair practices in regard to competition. Countries like the UK and Germany also passed their versions of antitrust laws in the late nineteenth and early twentieth centuries. After World War II, most countries began enacting competition laws in order to check economic concentration. In Europe, the Treaty of Rome, 1957 established the European Economic Community with “Articles 85 and 86” prohibited anti-competitive agreements and abuse of dominant position. The Anti-Monopoly Act was passed in Japan in the year 1947. The countries of Canada and Australia have also passed similar laws. The global organization, World Trade Organization (WTO), and the Organization for Economic Co-operation and Development (OECD) have also contributed in developing competition law.
