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COMPETITION ACT, 2002

Ministry of Law and Justice

Act nº 12 of 2003


  • Chapter 1
  • Chapter 2
  • Chapter 3
  • Chapter 4
  • Chapter 5
  • Chapter 6
  • Chapter 7
  • Chapter 8
  • Chapter 8A
  • Chapter 9
  • Act nº 12 of 2003

Preamble

THE COMPETITION ACT, 2002

[Act, No. 12 of 2003]

[13th January, 2003]

PREAMBLE

An Act to provide, keeping in view of the economic development of the country, for the establishment of a Commission to prevent practices having adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carried on by other participants in markets, in India, and for matters connected therewith or incidental thereto.

be it enacted by Parliament in the Fifty-third Year of the Republic of India as follows:--

Chapter 1

Section 1. Short title extent and commencement

11. Short title extent and commencement.--

(1) This Act may be called the Competition Act, 2002.

(2) It extends to the whole of India except the State of Jammu and Kashmir.

(3) It shall come into force on such date 2as the Central Government may, by notification in the Official Gazette, appoint:

Provided that different dates may be appointed for different provisions of this Act and any reference in any such provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.

1. Effective from 31.03.2003 by Notification No. 340 (E) Dated 31.03.2003

2. Section 66 and section 50 w.e.f. 1st September, 2009 vide Notification No. SO2204(E) Dated 28.08.2009.


Section 2. Definitions

In this Act, unless the context otherwise requires,--

2 (a) "acquisition" means, directly or indirectly, acquiring or agreeing to acquire--

(i) shares, voting rights or assets of any enterprise; or

(ii) control over management or control over assets of any enterprise;

2 (b) "agreement" includes any arrangement or understanding or action in concert,:--

(i) whether or not, such arrangement, understanding or action is formal or in writing; or

(ii) whether or not such arrangement, understanding or action is intended to be enforceable by legal proceedings;

3[(ba) "Appellate Tribunal" means the Competition Appellate Tribunal established under sub-section (1) of section 53A.]

2 (c) "cartel" includes an association of producers, sellers, distributors, traders or service providers who, by agreement amongst themselves, limit, control, or attempt to control the production, distribution, sale or price of, or, trade in goods or provision of services;

1 (d) "Chairperson'' means the Chairperson of the Commission appointed under sub-section (1)of section 8;

2 (e) "Commission" means the Competition Commission of India established under sub-section (1) of section 7;

2 (f) "consumer means any person who---

(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, whether such purchase of goods is for resale or for any commercial purpose or for personal use;

(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first-mentioned person whether such hiring or availing of services is for any commercial purpose or for personal use;

1 (g) "Director General" means the Director General appointed under sub-section (1) of section 16 and includes any Additional, Joint, Deputy or Assistant Directors General appointed under that section;

2 (h) "enterprise" means a person or a department of the Government, who or which is, or has been, engaged in any activity, relating to the production, storage, supply, distribution, acquisition or control of articles or goods, or the provision of services, of any kind, or in investment, or in the business of acquiring, holding, underwriting or dealing with shares, debentures or other securities of any other body corporate, either directly or through one or more of its units or divisions or subsidiaries, whether such unit or division or subsidiary is located at the same place where the enterprise is located or at a different place or at different places, but does not include any activity of the Government relatable to the sovereign functions of the Government including all activities carried on by the departments of the Central Government dealing with atomic energy, currency, defence and space.

Explanation.--For the purposes of this clause,--

(a) "activity" includes profession or occupation;

(b) "article" includes a new article and "service" includes a new service;

(c) "unit" or "division", in relation to an enterprise, includes--

(i) a plant or factory established for the production, storage, supply, distribution, acquisition or control of any article or goods;

(ii) any branch or office established for the provision of any service;

2 (i) "goods" means goods as defined in the Sale of Goods Act, 1930 (8 of 1930) and includes--

(A) products manufactured, processed or mined;

(B) debentures, stocks and shares after allotment;

(C) in relation to goods supplied, distributed or controlled in India, goods imported into India;

1 (j) "Member" means a Member of the Commission appointed under sub-section (1) of section 8 and includes the Chairperson;

1 (k) "notification" means a notification published in the Official Gazette;

1 (l) "person" includes--

(i) an individual;

(ii) a Hindu undivided family;

(iii) a company;

(iv) a firm;

(v) an association of persons or a body of individuals, whether incorporated or not, in India or outside India;

(vi) any corporation established by or under any Central, State or Provincial Act or a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956);

(vii) any body corporate incorporated by or under the laws of a country outside India;

(viii) a co-operative society registered under any law relating to co­operative societies;

(ix) a local authority;

(x) every artificial juridical person, not falling within any of the preceding sub-clauses;

2 (m) "practice" includes any practice relating to the carrying on of any trade by a person or an enterprise;

1 (n) "prescribed" means prescribed by rules made under this Act;

2 (o) "price", in relation to the sale of any goods or to the performance of any services, includes every valuable consideration, whether direct or indirect, or deferred, and includes any consideration which in effect relates to the sale of any goods or to the performance of any services although ostensibly relating to any other matter or thing;

2 (p) "public financial institution" means a public financial institution specified under section 4A of the Companies Act, 1956 (1 of 1956) and includes a State Financial, Industrial or Investment Corporation;

2 (q) "regulations" means the regulations made by the Commission under section 64;

2 (r) "relevant market" means the market which may be determined by the Commission with reference to the relevant product market or the relevant geographic market or with reference to both the markets;

2 (s) "relevant geographic market" means a market comprising the area in which the conditions of competition for supply of goods or provision of services or demand of goods or services, are distinctly homogenous and can be distinguished from the conditions prevailing in the neighbouring areas;

2 (t) "relevant product market" means a market comprising all those products or services which are regarded as interchangeable or substitutable by the consumer, by reason of characteristics of the products or services, their prices and intended use;

2 (u) "service" means service of any description which is made available to potential users and includes the provision of services in connection with business of any industrial or commercial matters such as banking, communication, education, financing, insurance, chit funds, real estate, transport, storage, material treatment, processing, supply of electrical or other energy, boarding, lodging, entertainment, amusement, construction, repair, conveying of news or information and advertising;

2 (v) "shares" means shares in the share capital of a company carrying voting rights and includes--

(i) any security which entitles the holder to receive shares with voting rights;

(ii) stock except where a distinction between stock and share is expressed or implied;

2 (w) "statutory authority" means any authority, board, corporation, council, institute, university or any other body corporate, established by or under any Central, State or Provincial Act for the purposes of regulating production or supply of goods or provision of any services or markets therefor or any matter connected therewith or incidental thereto;

2 (x) "trade'' means any trade, business, industry, profession or occupation relating to the production, supply, distribution, storage or control of goods and includes the provision of any services;

2 (y) "turnover" includes value of sale of goods or services;

2 (z) words and expressions used but not defined in this Act and defined in the Companies Act, 1956 (1 of 1956) shall have the same meanings respectively assigned to them in that Act.

1. Effective from 31.03.2003 by Notification No. 340 (E) Dated 31.03.2003.

2. Effective from 19.06.2003 by Notification No. SO 715 (E) Dated 19.06.2003.

3. Inserted by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007] w.e.f 12.10.2007.


Chapter 2

Section 3. Prohibition of agreements: Anti competitive agreements

1[(1) No enterprise or association of enterprises or personor association of persons shall enter into any agreement in respect ofproduction, supply, distribution, storage, acquisition or control of goods orprovision of services, which causes or is likely to cause an appreciableadverse effect on competition within India.

(2) Any agreement entered into in contravention of theprovisions contained in sub­section (7) shall be void.

(3) Any agreement entered into between enterprises orassociations of enterprises or persons or associations of persons or betweenany person and enterprise or practice carried on, or decision taken by, anyassociation of enterprises or association of persons, including cartels,engaged in identical or similar trade of goods or provision of services,which--

(a) directly or indirectly determines purchase or saleprices;

(b) limits or controls production, supply, markets,technical development, investment or provision of services;

(c) shares the market or source of production or provisionof services by way of allocation of geographical area of market, or type ofgoods or services, or number of customers in the market or any other similarway;

(d) directly or indirectly results in bid rigging orcollusive bidding, shall be presumed to have an appreciable adverse effect oncompetition:

Provided that nothing contained in this sub-sectionshall apply to any agreement entered into by way of joint ventures if suchagreement increases efficiency in production, supply, distribution, storage,acquisition or control of goods or provision of services.

Explanation.--For the purposes of this sub-section,"bid rigging" means any agreement, between enterprises or personsreferred to in sub-section (3) engaged in identical or similar production ortrading of goods or provision of services, which has the effect of eliminatingor reducing competition for bids or adversely affecting or manipulating theprocess for bidding.

(4) Any agreement amongst enterprises or persons atdifferent stages or levels of the production chain in different markets, inrespect of production, supply, distribution, storage, sale or price of, ortrade in goods or provision of services, including ---

(a) tie-in arrangement;

(b) exclusive supply agreement;

(c) exclusive distribution agreement;

(d) refusal to deal;

(e) resale price maintenance,

shall be an agreement incontravention of sub-section (1) if such agreement causes or is likely to causean appreciable adverse effect on competition in India.

Explanation.--For the purposes of this sub-section,-

(a) "tie-in arrangement" includes any agreementrequiring a purchaser of goods, as a condition of such purchase, to purchasesome other goods;

(b) "exclusive supply agreement" includes anyagreement restricting in any manner the purchaser in the course of his tradefrom acquiring or otherwise dealing in any goods other than those of the selleror any other person;

(c) "exclusive distribution agreement" includesany agreement to limit, restrict or withhold the output or supply of any goodsor allocate any area or market for the disposal or sale of the goods;

(d) "refusal to deal" includes any agreementwhich restricts, or is likely to restrict, by any method the persons or classesof persons to whom goods are sold or from whom goods are bought;

(e) "resale price maintenance" includes anyagreement to sell goods on condition that the prices to be charged on theresale by the purchaser shall be the prices stipulated by the seller unless itis clearly stated that prices lower than those prices may be charged.

(5) Nothing contained in this section shall restrict--

(i) the right of any person to restrain any infringementof, or to impose reason­able conditions, as may be necessary for protecting anyof his rights which have been or may be conferred upon him under--

(a) the Copyright Act, 1957 (14 of 1957);

(b) the Patents Act, 1970 (39 of 1970);

(c) the Trade and Merchandise Marks Act, 1958 (43 of 1958)or the Trade Marks Act, 1999 (47 of 1999);

(d) the Geographical Indications of Goods (Registrationand Protection)Act, 1999(48 of 1999),

(e) the Designs Act, 2000 (16 of 2000);

(f) the Semi-conductor Integrated Circuits Layout-DesignAct, 2000 (37 of 2000);

(ii) the right of any person to export goods from India tothe extent to which the agreement relates exclusively to the production, supply, distribution or control of goods or provision of services for suchexport.]

1. Effective date :20th May 2009- notified vide Ministry of Corporate Affairs Notification No S.O.1241(E) dated 15.05.2009.


Section 4. Prohibition of abuse of dominant position: Abuse of dominant position

4[1[(1) No enterprise or group shall abuse its dominant position.]

(2) There shall be an abuse of dominant position 2[under sub-section (1), if an enterprise or a group],---

(a) directly or indirectly, imposes unfair or discriminatory--

(i) condition in purchase or sale of goods or service; or

(ii) price in purchase or sale (including predatory price) of goods or service.

Explanation.--For the purposes of this clause, the unfair or discriminatory condition in purchase or sale of goods or service referred to in sub-clause (i) and unfair or discriminatory price in purchase or sale of goods (including predatory price) or service referred to in sub-clause (ii) shall not include such discriminatory condition or price which may be adopted to meet the competition; or

(b) limits or restricts--

(i) production of goods or provision of services or market therefor; or

(ii) technical or scientific development relating to goods or services to the prejudice of consumers; or

(c) indulges in practice or practices resulting in denial of market access 3[in any manner]; or

(d) makes conclusion of contracts subject to acceptance by other parties of supplementary obligations which, by their nature or according to commercial usage, have no connection with the subject of such contracts; or

(e) uses its dominant position in one relevant market to enter into, or protect, other relevant market.

Explanation.--For the purposes of this section, the expression--

(a) "dominant position" means a position of strength, enjoyed by an enterprise, in the relevant market, in India, which enables it to--

(i) operate independently of competitive forces prevailing in the relevant market; or

(ii) affect its competitors or consumers or the relevant market in its favour;

(b) "predatory price" means the sale of goods or provision of services, at a price which is below the cost, as may be determined by regulations, of production of the goods or provision of services, with a view to reduce competition or eliminate the competitors.

3[(c) "group" shall have the same meaning as assigned to it in clause (b) of the Explanation to section 5.]]

___
1. Substituted for the following by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].

"(1) No enterprise shall abuse its dominant position."

2. Substituted by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007] for the words, brackets and figure "under sub-section (1), if an enterprise".

3. Inserted by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].

4. Effective date :20th May 2009- notified vide Ministry of Corporate Affairs Notification No S.O.1241(E) dated 15.05.2009.


Section 5. Combination

Regulation of combinations

5. Combination.--

The acquisition of one or more enterprises by one or more persons or merger or amalgamation of enterprises shall be a combination of such enterprises and persons or enterprises, if--

(a) any acquisition where--

(i) the parties to the acquisition, being the acquirer and the enterprise, whose control shares, voting rights or assets have been acquired or are being acquired jointly have,--

(A) either, in India, the assets of the value of more than rupees one thousand crores or turnover more than rupees three thousand crores; or

1[(B) in India or outside India, in aggregate, the assets of the value of more than five hundred million US dollars, including at least rupees five hundred crores in India, or turnover more than fifteen hundred million US dollars, including at least rupees fifteen hundred crores in India; or]

(ii) the group, to which the enterprise whose control, shares, assets or voting rights have been acquired or are being acquired, would belong after the acquisition, jointly have or would jointly have,--

(A) either in India, the assets of the value of more than rupees four thousand crores or turnover more than rupees twelve thousand crores; or

2[(B) in India or outside India, in aggregate, the assets of the value of more than two billion US dollars, including at least rupees five hundred crores in India, or turnover more than six billion US dollars, including at least rupees fifteen hundred crores in India; or;]

(b) acquiring of control by a person over an enterprise when such person has already direct or indirect control over another enterprise engaged in production, distribution or trading of a similar or identical or substitutable goods or provision of a similar or identical or substitutable service, if--

(i) the enterprise over which control has been acquired along with the enterprise over which the acquirer already has direct or indirect control jointly have,--

(A) either in India, the assets of the value of more than rupees one thousand crores or turnover more than rupees three thousand crores; or

3[(B) in India or outside India, in aggregate, the assets of the value of more than five hundred million US dollars, including at least rupees five hundred crores in India, or turnover more than fifteen hundred million US dollars, including at least rupees fifteen hundred crores in India; or;]

(ii) the group, to which enterprise whose control has been acquired, or is being acquired, would belong after the acquisition, jointly have or would jointly have,--

(A) either in India, the assets of the value of more than rupees four thousand crores or turnover more than rupees twelve thousand crores; or

4[(B) in India or outside India, in aggregate, the assets of the value of more than two billion US dollars, including at least rupees five hundred crores in India, or turnover more than six billion US dollars, including at least rupees fifteen hundred crores in India; or;]

(c) any merger or amalgamation in which--

(i) the enterprise remaining after merger or the enterprise created as a result of the amalgamation, as the case may be, have,--

(A) either in India, the assets of the value of more than rupees one thousand crores or turnover more than rupees three thousand crores; or

5[(B) in India or outside India, in aggregate, the assets of the value of more than five hundred million US dollars, including at least rupees five hundred crores in India, or turnover more than fifteen hundred million US dollars, including at least rupees fifteen hundred crores in India; or;]

(ii) the group, to which the enterprise remaining after the merger or the enterprise created as a result of the amalgamation, would belong after the merger or the amalgamation, as the case may be, have or would have,--

(A) either in India, the assets of the value of more than rupees four thousand crores or turnover more than rupees twelve thousand crores; or

6[(B) in India or outside India, in aggregate, the assets of the value of more than two billion US dollars, including at least rupees five hundred crores in India, or turnover more than six billion US dollars, including at least rupees fifteen hundred crores in India.]

Explanation.--For the purposes of this section,--

(a) "control" includes controlling the affairs or management by--

(i) one or more enterprises, either jointly or singly, over another enterprise or group;

(ii) one or more groups, either jointly or singly, over another group or enterprise:

(b) "group" means two or more enterprises which, directly or indirectly, are in a position to ---

(i) exercise twenty-six per cent. or more of the voting rights in the other enterprise; or

(ii) appoint more than fifty per cent, of the members of the board of directors in the other enterprise: or

(iii) control the management or affairs of the other enterprise;

(c) the value of assets shall be determined by taking the book value of the assets as shown, in the audited books of account of the enterprise, in the financial year immediately preceding the financial year in which the date of proposed merger falls, as reduced by any depreciation, and the value of assets shall include the brand value, value of goodwill, or value of copyright, patent, permitted use, collective mark, registered proprietor, registered trade mark, registered user, homonymous geographical indication, geographical indications, design or layout-design or similar other commercial rights, if any, referred to in sub-section (5) of section 3.

1. Substituted for the following by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].

"(B) in India or outside India, in aggregate, the assets of the value of more than five hundred million US dollars or turnover more than fifteen hundred million US dollars; or"

2. Substituted for the following by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].

"(B) in India or outside India, in aggregate, the assets of the value of more than two billion US dollars or turnover more than six billion US dollars; or"

3. Substituted for the following by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].

"(B) in India or outside India, in aggregate, the assets of the value of more than five hundred million US dollars or turnover more than fifteen hundred million US dollars; or"

4. Substituted for the following by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].

"(B) in India or outside India, in aggregate, the assets of the value of more than two billion US dollars or turnover more than six billion US dollars; or"

5. Substituted for the following by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].

"(B) in India or outside India, in aggregate, the assets of the value of more than five hundred million US dollars or turnover more than fifteen hundred million US dollars; or"

6. Substituted for the following by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].

"(B) in India or outside India, the assets of the value of more than two billion US dollars or turnover more than six billion US dollars."


Section 6. Regulation of combinations

Regulation of combinations

6. Regulation of Combinations.--

(1) No person or enterprise shall enter into a combination which causes or is likely to cause an appreciable adverse effect on competition within the relevant market in India and such a combination shall be void.

(2) Subject to the provisions contained in sub-section (1), any person or enterprise, who or which proposes to enter into a combination, 1[shall], give notice to the Commission, in the form as may be specified, and the fee which may be determined, by regulations, disclosing the details of the proposed combination, within 2[thirty days] of--

(a) approval of the proposal relating to merger or amalgamation, referred to in clause (c) of section 5, by the board of directors of the enterprises concerned with such merger or amalgamation, as the case may be;

(b) execution of any agreement or other document for acquisition referred to in clause (a) of section 5 or acquiring of control referred to in clause (b) of that section.

3[(2A) No combination shall come into effect until two hundred and ten days have passed from the day on which the notice has been given to the Commission under sub-section (2) or the Commission has passed orders under section 31, whichever is earlier.]

(3) The Commission shall, after receipt of notice under sub-section (2), deal with such notice in accordance with the provisions contained in sections 29, 30 and 31.

(4) The provisions of this section shall not apply to share subscription or financing facility or any acquisition, by a public financial institution, foreign institutional investor, bank or venture capital fund, pursuant to any covenant of a loan agreement or investment agreement.

(5) The public financial institution, foreign institutional investor, bank or venture capital fund, referred to in sub-section (4), shall, within seven days from the date of the acquisition, file, in the form as may be specified by regulations, with the Commission the details of the acquisition including the details of control, the circumstances for exercise of such control and the consequences of default arising out of such loan agreement or investment agreement, as the case may be.

Explanation.--For the purposes of this section, the expression--

(a) "foreign institutional investor" has the same meaning as assigned to it in clause (a) of the Explanation to section 115AD of the Income-tax Act, 1961 (43 of 1961);

(b) "venture capital fund" has the same meaning as assigned to it in clause (b) of the Explanation to clause (23FB) of section 10 of the Income-tax Act, 1961 (43 of 1961).

1. Substituted by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007] for the words "may, at his or its option,".

2. Substituted by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007] for the words "seven days".

3. Inserted by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007].


Chapter 3

Section 7. Establishment of Commission

1 7. Establishment of Commission.--

(1) With effect from such date as the Central Government may, by notification, appoint, there shall be established, for the purposes of this Act, a Commission to be called the "Competition Commission of India".

(2) The Commission shall be a body corporate by the name aforesaid having perpetual succession and a common seal with power, subject to the provisions of this Act, to acquire, hold and dispose of property, both movable and immovable, and to contract and shall, by the said name, sue or be sued.

(3) The head office of the Commission shall be at such place as the Central Government may decide from time to time.

(4) The Commission may establish offices at other places in India.

1. Effective from 19.06.2003 by Notification No. SO 715 (E) Dated 19.06.2003.


Section 8. Composition of Commission

2[8. Composition of Commission.--

1) The Commission shall consist of a Chairperson and not less than two and not more than six other Members to be appointed by the Central Government.

(2) The Chairperson and every other Member shall be a person of ability, integrity and standing and who has special knowledge of, and such professional experience of not less than fifteen years in, international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs or competition matters, including competition law and policy, which in the opinion of the Central Government, may be useful to the Commission.

(3) The Chairperson and other Members shall be whole-time Members.]

1. Effective from 31.03.2003 by Notification No. 340 (E) Dated 31.03.2003

2. Substituted by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007] w.e.f. 12.10.2007. Prior to substitution it read as:

"18. Composition of Commission.--

(1) The Commission shall consist of a Chairperson and not less than two and not more than ten other Members to be appointed by the Central Government:

Provided that the Central Government shall appoint the Chairperson and a Member during the first year of the establishment of the Commission.

(2) The Chairperson and every other Member shall be a person of ability, integrity and standing and who, has been, or is qualified to be, a judge of a High Court, or, has special knowledge of, and professional experience of not less than fifteen years in international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs, administration or in any other matter which, in the opinion of the Central Government, may be useful to the Commission.

(3) The Chairperson and other Members shall be whole-time Members."



Section 9. Selection Committee for Chairperson and Members of Commission

2[9. Selection Committee for Chairperson and Members of Commission--

(1) The Chairperson and other Members of the Commission shall be appointed by the Central Government from a panel of names recommended by a Selection Committee consisting of--

(a) the Chief Justice of India or his nominee............Chairperson;

(b) the Secretary in the Ministry of Corporate Affairs.............Member;

(c) the Secretary in the Ministry of Law and Justice...............Member;

(d) two experts of repute who have special knowledge of, and professional experience in international trade, economics, business, commerce, law, finance, accountancy, management, industry, public affairs or competition matters including competition law and policy......................................................Members.

(2) The term of the Selection Committee and the manner of selection of panel of names shall be such as may be prescribed.]

1. Effective from 31.03.2003 by Notification No. 340 (E) Dated 31.03.2003

2. Substituted by the (Competition (Amendment) Act, 2007 [Act No. 39 0f 2007] w.e.f. 12.10.2007. Prior to substitution it read as:

"1 9. Selection of Chairperson and other Members.--

"The Chairperson and other Members shall be selected in the manner as may be prescribed."



Section 10. Term of office of Chairperson and other Members

1 10. Term of office of Chairperson and other Members.--

(1) The Chairperson and every other Member shall hold office as such for a term of five years from the date on which he enters upon his office and shall be eligible for reappointment:

2[Provided that the Chairperson or other Members shall not hold office as such after he has attained the age of sixty-five years.]

(2) A vacancy caused by the resignation or removal of the Chairperson or any other Member under section 11 or by death or otherwise shall be filled by fresh appointment in accordance with the provisions of sections 8 and 9.

(3) The Chairperson and every other Member shall, before entering upon his office, make and subscribe to an oath of office and of secrecy in such form, manner and before such authority, as may be prescribed.

(4) In the event of the occurrence of a vacancy in the office of the Chairperson by reason of his death, resignation or otherwise, the senior-most Member shall act as the Chairperson, until the date on which a new Chairperson, appointed in accordance with the provisions of this Act to fill such vacancy, enters upon his office.

(5) When the Chairperson is unable to discharge his functions owing to absence, illness or any other cause, the senior-most Member shall discharge the functions of the Chairperson until the date on which the Chairperson resumes the charge of his functions.

1. Effective from 31.03.2003 by Notification No. 340 (E) Dated 31.03.2003

2. Proviso substituted by the Competition (Amendment) Act, 2007 [Act No. 39 of 2007] w.e.f. 12.10.2007. Prior to substitution the text was as follows;

"Provided that no Chairperson or other Member shall hold office as such after he has attained,--

(a) in the case of the Chairperson, the age of sixty-seven years;

(b) in the case of any other Member, the age of sixty-five years."



Section 11. Resignation, removal and suspension of Chairperson and other Members

1 11. Resignation, removal and suspension of Chairperson andother Members.--

(1) The Chairperson or any other Member may, bynotice in writing under his hand addressed to the Central Government, resignhis office:

Provided that the Chairperson or a Member shall, unless heis permitted by the Central Government to relinquish his office sooner,continue to hold office until the expiry of three months from the date ofreceipt of such notice or until a person duly appointed as his successor entersupon his office or until the expiry of his term of office, whichever is theearliest.

(2) Notwithstanding anything contained in sub-section (1),the Central Government may, by order, remove the Chairperson or any otherMember from his office if such Chairperson or Member, as the case may be,--

(a) is, or at any time has been, adjudged as an insolvent;or

(b) has engaged at any time, during his term of office, inany paid employment; or

(c) has been convicted of an offence which, in the opinionof the Central Government, involves moral turpitude; or

(d) has acquired such financial or other interest as islikely to affect prejudicially his functions as a Member; or

(e) has so abused his position as to render hiscontinuance in office prejudicial to the public interest; or

(f) has become physically or mentally incapable of actingas a Member.

(3) Notwithstanding anything contained in sub-section (2),no Member shall be removed from his office on the ground specified in clause(d) or clause (e) of that sub-section unless the Supreme Court, on a referencebeing made to it in this behalf by the Central Government, has, on an inquiry,held by it in accordance with such procedure as may be prescribed in thisbehalf by the Supreme Court, reported that the Member, ought on such ground orgrounds to be removed.

1. Effective from 19.06.2003 by Notification No. SO 715(E) Dated 19.06.2003.