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CMA Final · Corporate and Economic Laws · The Competition Act, 2002

A company incorporated and operating only in Singapore enters into an agreement with another foreign firm outside India. The agreement is likely to cause an appreciable adverse effect on competition in a relevant market in India. Under Section 32, what is the position of the CCI?

The CCI has power to inquire. Section 32 applies even if the agreement was made outside India or all parties are foreign, provided the agreement has or is likely to have an appreciable adverse effect on competition in the relevant market in India.

  1. AIt has no power because the agreement was entered into outside India
  2. BIt has power to inquire only if one party is an Indian resident
  3. CIt has power to inquire only after prior approval of the Central Government
  4. DIt has power to inquire, despite the agreement being made outside India, if it has or is likely to have an appreciable adverse effect on competition in the relevant market in IndiaCorrect

Explanation

Section 32 applies notwithstanding that the agreement was entered into outside India or any party is outside India. The Commission may inquire in accordance with the specified sections if there is an appreciable adverse effect on competition in the relevant market in India. No Indian party or Government approval is required.

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