The world does not need any more lessons on the need for a “regulated” market so as to preclude market failures. At the same time, it is imperative to design a regulatory framework with minimum frictions amongst the regulators themselves. Having set the context, I intend to pen down my thoughts on regulatory tussles involving Competition Commission of India (CCI). In subsequent posts, I shall critically examine the Delhi High Court judgment in 2016 (Ericsson case) which dealt with Competition Act and Patent Act.
CCI v. TRAI
It was reported some time back that a legal tussle between the two most prominent regulators, Competition Commission of India (CCI) and Telecom Regulatory Authority of India (TRAI), is in the offing. As per news reports, in a letter to Trai chairman RS Sharma on July 21, CCI expressed apprehension with regard to telecom regulator’s move to create an analytical framework on predatory pricing, which rests upon definitions and concepts of the Competition Act and pertinent case laws. Apparently, it was pointed out that such practice would blur the lines between the two bodies and would lead to confusion.
The Wire carried an excellent article written by Pradeep S. Mehta and Udai S. Mehta. They argued that “the best approach would be to have mandatory consultation between the regulators, which can be achieved by revisiting the legal framework. For example, the same can be a feature in the draft Regulatory Reform Bill, prepared under the aegis of the then Planning Commission of India and now under discussions at the NITI Aayog. Such a provision will ensure the responsibility of every regulator to keep in loop other regulators exercising overlapping domain over the same issue. Cooperation and not competition will be the best way forward to resolve such turf issues. The European Union member states too have resolved the overlap issues by providing for mandatory consultation between the competition authority and sector regulators under both the competition law and sector regulatory laws.” The authors relied on judicial precedents and rightly pointed out the limitations in adversarial stints. They strongly recommended mandatory consultation based on some tenable arguments . I strongly urge the readers to go through this article.
I have a slightly different proposition so as to address the regulatory overlap like in the instant case. Though I agree with the idea of mandatory consultation, it should be in an ecosystem that gives primacy to a regulator. Mandatory consultation may not always lead to definitive conclusions. Decisions may be right or wrong. But there should be one final word. And for that, “primacy” for a particular regulator may be sine qua non. It brings in certainty. In any case, this is an area which mandates greater, incisive policy analysis. Further, judiciary may not be the right platform as involvement of judiciary in the policy domain is always a tricky proposition. This discussion is relevant in the context of Delhi High Court Judgement in Ericsson case (2016) wherein it dealt with apparent conflict between Patent Act, 1970 and Competition Act, 2002. I shall deal with this judgment in subsequent posts.