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Act on global cos abusing Indian firms: Sitharaman to CCI
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SME Times News Bureau | 23 Aug, 2019
Finance Minister Nirmala
Sitharaman on Friday asked fair market regulator the Competition
Commission of India to guard Indian businesses and consumers against
foreign companies, which have no presence in India, by taking suo motu
action against them.
"Physical borders no longer determine
competition within a country and that way we are not dealing with fair
play, as it is. We are dealing with an entity which is outside, probably
legally, complying with many of the requirements in the jurisdiction in
which it exists, but having an unfair impact, on the consumers here. If
that is not abuse, then what can be? And if that abuse is being felt by
Indians?
"In the G20, the whole discussion today is about how
you would define operations, how you would define profits or turnovers
which are generated in a geographical physical area where one doesn't
operate. Physically, you are not present, but you are making a turnover
and earning your profits in an area, which is jurisdictionally different
from where you are. So if that is the way global competition is
evolving and it is not evolving in some way whose impact is not on us,
whose impact is so much on us that we are still probably wondering as to
how we are going to rein in that kind of, if I may use the word, abuse.
It is not always abuse, but it is a smoking gun. That's the smoking gun
which governments, not just in India, but also in countries which we
think are far ahead of us in understanding competition law are
confronting," said Sitharaman.
She was addressing an event
organised to mark the 10th anniversary of the CCI. The minister, who is
also in charge of corporate affairs, said the CCI should be ready with a
2.0 action plan to meet the challenges of frontierless economies.
In recent times, the watchdog has been dealing with many cases in the digital area.
"Every
now and then, we get these fantastic cases which have fantastic amount
of claims and which also have such dimensions to competition law which
many countries, which are the so-called free economies are struggling to
understand and disaggregate so that they can handle each aspect. If
that is the way it is, and if they also have an impact on us, I think
the CCI when I say is going to mark its 2.0 from now, will have to look
at two things," she said.
"How many cases would you have started
on a suo moto basis? It's just not the number, but also the way in which
the Commission has to keep itself alert to many of the developments
which are happening globally. I would want the CCI 2.0 to look at what
is developing globally and which already is having an impact on us," she
said.
In its recently submitted report, the Competition Law
Review Committee headed by MCA Secretary I. Srinivas has recommended
automatic CCI approval for most M&A cases, including those under
insolvency law.
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