One section in the Banking Laws Amendment Bill, 2011 is fuelling a potential turf war with sectoral regulators on one side and the Competition Commission of India on the other. The section says nothing contained in the Competition Act, 2002 shall apply to any banking company, the state bank of India, any subsidiary bank, any corresponding new bank or any regional rural bank or co-operative bank or multi-state co-operative bank in respect of the matters relating to amalgamation, merger, reconstruction, transfer, reconstitution or acquisition. in short, RBI should be the sole regulator of the sector and cci should have no jurisdiction. Similar demands have been made by shipping and telecom sector regulators as well. In response, the Competition Commission had this to say
Ashok Chawla, Chairman, CCI to CNBC TV18
Why it is being perceived that what the competition regulator does can as well be done by the sectoral regulators- not so-the legal architecture doesn't provide for that. And if did provide for that, the legislature in its wisdom would not have enacted the Competition Act.
The two sets of bodies- the sectoral regulators and the market regulators have necessarily to co-exist.
If this virus spreads, then you might as well wind up the Commission.
Now this debate is certainly not unique to India- its happened in the UK, its happened in the US. This week, Payaswini Upadhyay gets experts Thinking Aloud on how other jurisdictions have managed the overlap and what India can do to strike a balance
Anti-Trust Laws: Scope of Sectoral Exemption?
Former Deputy Chairman
Competition Commission, UK
In the UK, there hasnt been very much debate historically as regards mergers. But its always been pretty much a consensus that the Competition authorities are the ones to decide on that. As regards Competition rules, more generally, anti-cartel, anti-abuse, dominance rules- weve come to an accommodation actually which is called