(NO.02 OF 2024) In exercise of the powers conferred by sub- section (1)
and clauses (ga), (gb) and (gc) of sub-section (2) of section 64, read
with section 46 and clause (b) of section 27 of the
Competition Act, 2002 (12 of 2003), the Competition Commission of India hereby
makes the following regulations, namely: - (1) These
regulations may be called the Competition Commission of India (Lesser Penalty)
Regulations, 2024. (2) They shall
come into force on the date of their publication in the Official Gazette. (1) In these
regulations, unless the context otherwise requires, - (a) "Act"
means the Competition Act, 2002 (12 of 2003) as amended from time to time; (b) "admission"
means statement or submission by a party that it has indulged in the alleged
violation of the provisions of Section 3 of the Act; (c) "applicant"
means an enterprise, as defined in clause (h) of section 2 of the
Act, who is or was a member of a cartel and includes an individual who has been
involved in the cartel on behalf of an enterprise; and further includes an
enterprise or association of enterprises or a person or association of persons,
though not engaged in identical or similar trade if it participates or intends
to participate in furtherance of such cartel and submits an application for
lesser penalty and/or lesser penalty plus to the Commission; (d) "cartel"
means a cartel as defined in clause (c) of section 2 of the Act; (e) "Commission"
means the Competition Commission of India established under sub-section (1) of
section 7 of the Act; (f) "designated
authority" means an officer of the Commission who is authorized by the
Chairperson to function as such, for the purpose of these regulations; (g) "Director
General" means the Director General as defined in clause (g) of
section 2 of the Act; (h) "newly
disclosed cartel" means a cartel as determined by the Commission having
regard to the disclosures provided by the applicant in Schedule I and Schedule
II of these regulations, including the material available with the Commission
or the Director General, which enables the Commission to form a prima facie
opinion under sub section (1) of section 26 of the Act; (i) "party"
includes an enterprise or person defined in clauses (h) and (l) of
section 2 of the Act, respectively, against whom inquiry or
proceeding is instituted and shall include the Central Government, any State
Government or any statutory authority and shall also include any person
permitted to join the proceedings; (j) "priority
status" means the position of the applicant marked for giving the benefit
of lesser penalty or lesser penalty plus in the queue of the applicants; (k) "vital
disclosure" means full and true disclosure of information or evidence by
the applicant to the Commission, which is sufficient to enable the Commission
to form a prima facie opinion about the existence of a cartel or which helps to
establish the contravention of the provisions of section 3 of the
Act. (2) Words and
expressions used but not defined in these regulations shall have the same
meanings respectively as assigned to them in the Act or the rules or
regulations framed thereunder or in the Companies Act, 2013 (18 of 2013). (1) An
applicant, seeking the benefit of lesser penalty or lesser penalty plus under
section 46 of the Act, shall- (a) cease to
have further participation in the cartel from the time of its disclosure unless
otherwise directed by the Commission; (b) provide
vital disclosure in respect of alleged contravention of the provisions of
section 3 of the Act; (c) provide
all relevant information, documents and evidence as may be required by the
Commission; (d) co-operate
genuinely, fully, continuously and expeditiously throughout the investigation
and other proceedings before the Commission; (e) not
conceal, destroy, manipulate or remove the relevant documents in any manner
that may contribute to the establishment of a cartel; and (f) not give
any false evidence or omit to submit any material information knowing it to be
material. (2) The
applicant shall provide the names of the individuals who have been involved in
the cartel on its behalf and for whom lesser penalty or lesser penalty plus, as
the case may be, is sought by the applicant. (3) Where an
applicant or its authorized representative, at the time of filing of
application for lesser penalty or lesser penalty plus, as the case may be,
fails to provide full and true disclosure of the information and evidence as
referred and described in Schedule I or Schedule II or both or as required by
the Commission from time to time, the Commission may reject its application. (4) Without
prejudice to sub-regulation (1), the Commission may subject the applicant to
further restrictions or conditions, as it may deem fit, after considering the
facts and circumstances of the case. (5) Where an applicant
or its authorized representative fails to comply with the conditions mentioned
in sub- regulations (1) and (4), either before the Director General or before
the Commission after receipt of the investigation report, the Commission may
reject its application. (6) Before
rejecting the lesser penalty or lesser penalty plus application of the
applicant under this regulation, the Commission shall provide an opportunity of
being heard to such applicant. (7) Notwithstanding
rejection of application in terms of sub-regulations (3) or (5) above, the
Commission or the Director General shall be free to use the information,
documents and evidence submitted by the applicant, in the ongoing matter, in
accordance with the provisions of section 46 of the Act. (8) Upon rejection
of application in terms of sub-regulations (3) or (5) above, the applicant may
be subjected to inquiry for the contravention. (9) The
discretion of the Commission, in regard to reduction in monetary penalty under
these regulations, shall be exercised having due regard to - (a) the stage
at which the applicant comes forward with the disclosure; (b) the
evidence already in possession of the Commission; (c) the
quality of the information provided by the applicant; (d) fulfilment
of conditions specified in sub-regulation (1) and (4) above; and (e) the entire
facts and circumstances of the case. Subject
to the conditions laid down in regulation 3, the applicant and individual(s)
mentioned in sub-regulation 2 of regulation 3 shall be granted benefit of
lesser penalty on the amount leviable under clause (b) of
section 27 and section 48 of the Act, as the Commission may
decide, in the following manner, namely: (a) The
applicant and individual(s) mentioned in sub-regulation (2) of regulation 3 may
be granted benefit of reduction in penalty upto or equal to one hundred
percent, if the applicant is the first to make a vital disclosure by submitting
evidence of a cartel, enabling the Commission to form a prima facie opinion
regarding the existence of a cartel which is alleged to have contravened the
provisions of section 3 of the Act and the Commission did not, at the
time of application, have sufficient evidence to form such an opinion: Provided
that the Commission may also grant benefit of reduction in penalty up to or
equal to one hundred per cent, to the applicant and individual(s) mentioned in
sub-regulation (2) of regulation 3, if the applicant is the first to make a
vital disclosure by submitting such evidence which establishes the contravention
of the provisions of section 3 of the Act, by a cartel, in a matter
under investigation and the Commission, or the Director General did not, at the
time of application, have sufficient evidence to establish such a
contravention. (b) The
applicant(s) and individual(s) who are subsequent to the first applicant may
also be granted benefit of reduction in penalty on making a disclosure by
submitting evidence, which in the opinion of the Commission, provides
significant added value to the evidence already in possession of the Commission
or the Director General, as the case may be, to establish the existence of the
cartel, which is alleged to have contravened the provisions of
section 3 of the Act. Explanation For the purposes of these regulations,
'significant added value' means the extent to which the evidence provided
enhances the ability of the Commission or the Director General, as the case may
be, to establish the existence of a cartel, which is alleged to have
contravened the provisions of section 3 of the Act. (c) The
reduction in monetary penalty referred to in clause (b) shall be in the
following order (i) the
applicant and individual(s) mentioned in sub-regulation (2) of regulation 3
marked as second in the priority status may be granted reduction of monetary penalty
up to or equal to fifty percent of the penalty imposed; and (ii) the
applicant and individual(s) mentioned in sub-regulation (2) of regulation 3
marked as third or subsequent in the priority status may be granted reduction
of penalty up to or equal to thirty percent of the penalty imposed. (1) In terms
of sub-section (4) of section 46 of the Act and subject to the
conditions laid down in regulations 3 and 4, an applicant, who had earlier made
a full, true and vital disclosure in respect of alleged contravention of
provisions of section 3 of the Act under regulation 6 (first cartel),
makes a full, true and vital disclosure in respect of existence of another
cartel (second cartel) in which it is alleged to have violated
section 3 of the Act, which enables the Commission to form a prima
facie opinion regarding the existence of newly disclosed cartel under
sub-section (1) of section 26 of the Act, may be granted an
additional reduction in monetary penalty up to or equal to thirty per cent of
the penalty imposed with regard to the first cartel besides obtaining benefit
of reduction in penalty up to or equal to one hundred percent in respect of
newly disclosed cartel in terms of sub-section (1) of section 46 of
the Act. Illustration: In
respect of Cartel A, X and Y are lesser penalty applicants having first and
second marker status with reduction in penalty available of up to or equal to
one hundred percent and fifty percent, respectively. Y, being aware of Cartel
B, reports about it under regulation 7. Subject to fulfilment of requisite
conditions, for reporting Cartel B, Y shall be eligible for additional
reduction in penalty of up to or equal to thirty percent in respect of Cartel
A, besides obtaining first marker status in respect of Cartel B. Provided
that the individual(s) of such applicant who were part of its lesser penalty
application in the first cartel may also be granted the benefit of lesser
penalty plus as applicable to the applicant, if such individual(s) are also a
part of both the newly disclosed cartel and the lesser penalty plus application
filed in that regard. (2) While
determining the newly disclosed cartel in terms of sub-section (4) of
section 46 of the Act, the Commission may have due regard to all
relevant factors that distinguish the newly disclosed cartel from the existing
cartel. (3) The
discretion of the Commission, in regard to reduction in monetary penalty under
regulation 5, shall be exercised having due regard to- (a) likelihood
of the newly disclosed cartel being detected by the Commission or the Director
General without lesser penalty plus application, and (b) any other
factor deemed relevant by the Commission. (1) For the
purpose of grant of lesser penalty, the applicant or its authorized
representative may make an application containing all the material information
as specified in the Schedule I of these regulations, or may intimate in writing
either in person or through e-mail or fax, to the designated authority, for
furnishing the information and evidence relating to the existence of a cartel.
The designated authority shall, thereafter, within ten working days, put up the
matter before the Commission for its consideration. Provided
that an application under sub regulation (1) of regulation 6 for grant of
lesser penalty can be made at any time during inquiry but not after the report
of investigation directed under section 26 of the Act has been
received by the Commission. (2) The date
and time of receipt of the application by the Commission shall be the date and
time as recorded by the designated authority or as recorded on the server or
the facsimile transmission machine of the designated authority. (3) The
Commission shall thereupon mark the priority status of the applicant and the
designated authority shall convey to the applicant through post or e-mail or
fax that the 'appropriate priority status has been marked', and that it shall
not entitle the applicant for grant of lesser penalty merely on that basis. (4) If only an
intimation is received under sub-regulation (1) for furnishing the information
and evidence relating to existence of a cartel, the Commission shall direct the
applicant to submit a written application containing all the material information
as specified in the Schedule I of these regulations within a period not
exceeding fifteen days. (5) Where the
application, along with the necessary documents, is not received within a
period of fifteen days from the date of communication of direction under
sub-regulation (4) or during the further period as may be extended by the
Commission, the priority status of the applicant and consequent benefit of
grant of lesser penalty shall stand forfeited. (6) Unless the
evidence submitted by the first applicant has been evaluated, the next
applicant shall not be evaluated by the Commission. (7) Where the
benefit of the priority status is not granted to the first applicant, the
subsequent applicants shall move up in order of priority for grant of priority
status by the Commission and the procedure prescribed above, as in the case of
first applicant, shall apply mutatis mutandis. (8) The
decision of the Commission of granting or rejecting the application for lesser
penalty shall be communicated to the applicant. (1) For the
purpose of grant of lesser penalty plus, the applicant or its authorized
representative may make an application containing all the material information
as specified in the Schedule II to these regulations, or may intimate in
writing either in person or through e-mail or fax, to the designated authority
for furnishing the information and evidence relating to the existence of a
newly disclosed cartel. The designated authority shall, thereafter, within ten
working days, put up the matter before the Commission for its consideration. Provided
that an application under sub regulation (1) of regulation 7 for grant of
lesser penalty plus can be made at any time before the receipt of investigation
report of the Director General under section 26 of the Act in the
first cartel by the Commission. Provided
further that in case of more than one applicant for lesser penalty plus in
respect of a newly disclosed cartel, the Commission shall not examine the
application of the next or subsequent applicant(s) for grant of the lesser
penalty plus, unless the application of the first lesser penalty plus applicant
has been rejected by the Commission. (2) The date
and time of receipt of the application by the Commission shall be the date and
time as recorded by the designated authority or as recorded on the server or
the facsimile transmission machine of the designated authority. (3) The
Commission shall thereupon mark the priority status of the applicant, for
lesser penalty plus in respect of the first cartel, and simultaneously for
lesser penalty in respect of the newly disclosed cartel, and the designated
authority shall convey to the applicant through post or e-mail or fax that the
'appropriate priority status has been marked', and that it shall not entitle
the applicant for grant of lesser penalty plus and/or lesser penalty merely on
that basis. (4) If only an
intimation is received under sub-regulation (1) for furnishing the information
and evidence relating to the existence of a newly disclosed cartel, the
Commission shall direct the applicant to submit a written application
containing all the material information as specified in the Schedule II to
these regulations within a period not exceeding fifteen days. (5) Where the
application, along with the necessary documents, is not received within a
period of fifteen days from the date of communication of direction under
sub-regulation (4) or during the further period as may be extended by the
Commission, the priority status of the applicant both for lesser penalty plus
in respect of the first cartel and for lesser penalty in respect of the newly
disclosed cartel along with their respective consequent benefits, shall stand
forfeited. (6) Where the
benefit of the 'lesser penalty plus' is not granted to the first applicant by
the Commission, the subsequent applicant(s), if any, shall be examined by the
Commission in order of their priority status for grant of 'lesser penalty plus'
status in respect of the first cartel and the procedure prescribed above, as in
the case of first applicant, shall apply mutatis mutandis. (7) The
decision of the Commission of granting or rejecting the application for lesser
penalty plus shall be communicated to the applicant. (1) Notwithstanding
anything contained in the Competition Commission of India (General)
Regulations, 2009, the Commission or the Director General shall treat as
confidential, (a) the
identity of the applicant; and (b) the
information, documents and evidence furnished by the applicant under regulation
6 and/or regulation 7: Provided
that the identity of the applicant or such information or documents or evidence
may be disclosed if, (i) the
disclosure is required by law; or (ii) the
applicant has agreed to such disclosure in writing; or (iii) there has
been a public disclosure by the applicant Provided
further that where the Director General deems it necessary to disclose the
information, documents and evidence furnished under regulation 6 or regulation
7, as the case may be, to any party for the purposes of investigation and the
applicant has not agreed to such disclosure, the Director General may disclose
such information, documents and evidence to such party for reasons to be
recorded in writing and after taking prior approval of the Commission. (2) Except
submissions made before the Commission under regulations 6 and 7 above within a
period of fifteen days or during the further period as may be extended by the
Commission, confidentiality of all further submissions made by the lesser
penalty and/ or lesser penalty plus applicant before the Director General shall
be governed in terms of provisions of regulation 35 of Competition Commission
of India (General) Regulations, 2009. (1) Notwithstanding
the confidentiality under regulation 8, the provisions of sub- regulations (1),
(3) and (4) of regulation 37 and the provisions of regulation 50 of the
Competition Commission of India (General) Regulations, 2009, to the extent it
relates to inspection and grant of certified copies, shall become applicable to
the non-confidential version of the information, documents and evidence
furnished by the applicant under regulation 6, after the Commission forwards a
copy of the report containing the findings of the Director General to the party
concerned. (2) Notwithstanding
the confidentiality under regulation 8, the provisions of sub- regulations (1),
(3) and (4) of regulation 37 and the provisions of regulation 50 of the
Competition Commission of India (General) Regulations, 2009, to the extent it
relates to inspection and grant of certified copies, shall become applicable to
the non- confidential version of the information, documents and evidence
furnished by the applicant under regulation 7 in the second cartel, after the
Commission forwards a copy of the report containing the findings of the
Director General to the party concerned in the second cartel. (3) Any party
conducting inspection or obtaining certified copies under this regulation shall
not disclose such information, documents and evidence so obtained other than
for the proceedings under the Act. (1) The
applicant may withdraw the application under regulation 6 and/or regulation 7,
as the case may be, any time prior to the receipt of the report of
investigation, under section 26 of the Act in the concerned matter,
by the Commission. (2) Where the
applicant withdraws application under regulation 6 and/or regulation 7, as the
case may be, the Director General or the Commission shall be at liberty to use
for the purposes of the Act any information or evidence or document submitted
by the applicant except its admission. In
the matter of interpretation or implementation of the provisions of these regulations,
if any doubt or difficulty arises, the same shall be placed before the
Commission and the decision of the Commission thereon, shall be binding. (1) The
Competition Commission of India (Lesser Penalty) Regulations, 2009, stand
repealed from the date on which these regulations come into force. (2) Notwithstanding
such repeal - (a) anything
done or any action taken or purported to have been done or taken, or any
proceedings or decision, inquiry or investigation commenced under the repealed
regulations, prior to such repeal, shall be deemed to have been done or taken
under the corresponding provisions of these regulations; (b) the
operation of the repealed regulations or anything duly done or suffered
thereunder, any right, privilege, obligation or liability acquired, accrued or
incurred thereunder, or any investigation, legal proceeding or remedy ensued
thereunder, shall remain unaffected as if the repealed regulations have never
been repealed; (c) after the
repeal of the Competition Commission of India (Lesser Penalty) Regulations,
2009, any reference thereto including in any regulations, direction or decision
issued by the Commission shall be deemed to be a reference to the corresponding
provisions of these regulations. SCHEDULE
I CONTENTS OF THE
APPLICATION [See sub-regulations
(1) and (4) of regulation 6] The
application for lesser penalty shall, inter alia, include the following,
namely: - (a) name,
email, contact number and address of the applicant or its authorized representative
as well as of all other enterprises in the cartel; (b) in case
the applicant is based outside India, the address of the applicant in India for
communication including the telephone numbers and the e- mail address, etc.; (c) a detailed
description of the alleged cartel arrangement, including its aims and
objectives and the details of activities and functions carried out for securing
such aims and objectives; (d) the role
of the applicant in the cartel and admission in terms of sub-regulation (1)(b)
to regulation 2; (e) the goods
or services involved; (f) the
geographic market covered; (g) the
commencement and duration of the cartel; (h) the
estimated volume of business affected in India by the alleged cartel; (i) the names,
positions, office locations and, wherever necessary, home addresses of all
individuals who, in the knowledge of the applicant, are or have been associated
with the alleged cartel, including those individuals which have been involved
on behalf of the applicant; (j) the
details of other Competition Authorities, forums or courts, if any, which have
been approached or are intended to be approached in relation to the alleged
cartel; (k) details of
any previous contravention of the provisions of the Act by the applicant or any
proceeding pending against the applicant before the Commission for alleged
violation of provisions of the Act; (l) a
descriptive list of evidence regarding the nature and content of evidence
provided in support of the application for lesser penalty; and (m) any other
material information as may be directed by the Commission. SCHEDULE
II CONTENTS OF THE
APPLICATION [See sub-regulations
(1) and (4) of regulation 7] The
application for lesser penalty plus shall, inter alia, include the following,
namely:- (a) name,
email, contact number and address of the applicant or its authorized
representative; (b) details of
the ongoing matter or case(s) in which the applicant has already obtained any
priority status; (c) disclosures
pertaining to newly disclosed cartel as per the details sought in Schedule I
(two original copies); (d) whether
there exists any similarity between the conduct or product or service or
parties or matter referred to in (B) and (C) above, along with details thereof; (e) justification
as to how the newly disclosed cartel is new or separate cartel arrangement from
the first cartel in view of disclosure made in point (B) and (C) above; and (f) any other
material information.COMPETITION
COMMISSION OF INDIA (LESSER PENALTY) REGULATIONS, 2024
PREAMBLE