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

A Singapore-based company and an Indian company enter into an agreement outside India. The agreement is likely to cause an appreciable adverse effect on competition in the relevant market in India. Which statement is correct under Section 32 of the Competition Act, 2002?

The Commission can inquire into the agreement even though it was made outside India or a party is outside India, because the test is whether it has, or is likely to have, an appreciable adverse effect on competition in the relevant market in India.

  1. AThe Commission has no power because the agreement was entered into outside India
  2. BThe Commission has power to inquire only if both parties are located in India
  3. CThe Commission has power to inquire only after the Central Government gives permission
  4. DThe Commission has power to inquire despite the agreement being made outside India or a party being outside IndiaCorrect

Explanation

Section 32 gives the Commission power to inquire notwithstanding that the agreement was entered into outside India or any party is outside India, provided the agreement has or is likely to have an appreciable adverse effect on competition in the relevant market in India. No government permission is required.

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