The Competition Act 2002 considers the modern issues of globalization and WTO besides the shortcomings of the now repealed MRTP Act 1969. But the success of the Compititon Act 2002 depends on the identification and determination of anti-competitive agreement.
The MRTP Act, 1969
The MRTP Act, 1969, aims at preventing the concentration of economic power in order to avoid damage. The act allows for the probation of monopolistic, unfair and restrictive trade practices. This results in the control of monopolies and the consumer interest is thus protected. Monopolistic Trade Practice
Practices such as monopolistic trade reflects misuse of one's power to abuse the terms of production and sales of goods and services in the market. Eliminating competition from the market is the main objective of firms involved in monopolistic trade practice. They take advantage of their monopoly and charge unreasonably high prices. They also deteriorate the product quality, limit technical development, prevent competition and adopt unfair trade practices. Unfair Trade Practice
Unfair trade practices are caused due to:
* False representation and misleading advertisement of goods and services. * Falsely representing second-hand goods as new.
* Unreliable representation regarding usefulness, need, quality, standard, style etc of goods and services. * False claims or representation regarding price of goods and services. * Giving false facts regarding sponsorship, affiliation etc. of goods and services. * Giving false guarantee or warranty on goods and services without adequate tests. Restrictive Trade Practice
In order to maximize profits and to gain power in the market, traders often indulge in activities that have a tendency to block the flow of capital into production. These traders manipulate the conditions of delivery to affect the flow of supplies leading to unfair costs. About the MRTP Act, 1969
Except the state of Jammu and Kashmir, the...