Legal Framework of the Competition Act, 2002
The modern competition law regime in India, under the Competition Act, 2002 is a distinct break from the structuralist philosophy that underpinned the earlier regime under the Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act). The MRTP Act was where the presumption of size was anti-competitive, while the 2002 Act adopts a behavioural and effects-based model by focusing on abuse of dominance and not its mere existence. But it was drafted for a transitional liberal economy, not a digitally integrated marketplace, even though forward-looking for its time. As a result, the institutional and doctrinal tools of the Act are ill-equipped to meet the challenges of platform-centric dominance.[1]
The most relevant provision in the context of regulating platforms is Section 4 of the Competition Act, which contains a prohibition of abuse of dominant position. Section 4(2) states that this abuse includes practices that are unfair or discriminatory in the purchase of goods or services or the sale of goods or services, that tends to limit or restrict technical or scientific development, or that tend to deny the market access to goods or services. These rules are neutrally described but largely conceived for sunk-cost (or single-sided) markets in which firms sell to consumers (on a price) and vertical or horizontal arrangements are where dominance is asserted.
The CCI identifies a firm as dominant in market based on Section 19(4) which includes factors such as its market share, size and resources, reliance of purchasers, and barriers to entry. However, many of these indicators become indeterminate in the context of multi-sided digital markets. In particular, a zero-price platform — one that is free to end-users — may actually have considerable market power over the app developers or advertisers who interact with that platform, despite the platform’s inability to charge prices to end-users. Key platform-era ideas — including interoperability, self-preferencing, gatekeeping and data-driven exclusion — are not even defined and accounted for in the Competition Act, despite being of growing relevance for antitrust frameworks with a global reach.
In practice, the enforcement process under the Act commences with Section 19(1) (complaint or suo motu inquiry), followed by a prima facie determination under Section 26(1), and, if warranted, a full Director General (DG) investigation. Although the CCI has been proactive when it comes to using these tools, including in digital cases that are Google Android and MakeMyTrip–Oyo, the law does not provide it with ex-ante authority to impose structural remedies, conduct algorithmic audits or declare platforms as systemic gatekeepers, forms of jurisdictional power that are increasingly being recognized as necessary by jurisdictions like the European Union.
An equally important challenge comes from the definition of ‘relevant market’ under Section 2(r) and, by the same extension, ‘dominant position’ under Section 2(f). The CCI continues to define markets based on price-centric tools such as the SSNIP (Small but Significant Non-transitory Increase in Price) test. This test becomes inapplicable in zero-price platforms, like Google Search, WhatsApp, or Facebook, in which market power is instead exercised via design, defaults and data collection rather than price. While the CCI has made efforts to readjust its doctrinal focus—like defining the relevant market in terms of user attention or app ecosystem integration—those efforts are doctrinally incoherent and lack sufficient theoretical underpinning.[2]
Significantly, the Act additionally has procedural limitations on inter-agency coordination. Most digital platforms straddle regulatory silos—data protection (MeitY), financial services (RBI), telecom infrastructure (TRAI). It has not, however, been laid down in the Competition Act that there would be any binding cooperation mechanism between the CCI and these agencies, there would be joint queries or there would be any mechanism providing for sharing of data. Consequently, enforcement responses are their own fragmented process, and outcomes are delayed, or watered down.[3]
Though the Competition Act does give the CCI the power to issue cease-and-desist orders, impose fines and order modifications of conduct, it does not give it the power to designate gatekeepers or to lay down conduct codes for dominant platforms. This creates an enforcement gap — abuse may be found, but not preventive duties.
All in all, though the Competition Act, 2002 makes a landmark leap in Indian competition law, its doctrinal agnosticism and procedural minimalism leave it structurally ill-equipped to engage the regulatory imperatives of platform capitalism. The following sections will illustrate how these limits have manifested in particular enforcement matters, and why India must shift towards a digitally literate, ex-ante regime for competition in the platform era.
[1] Tewari, A., “A Critical Evaluation of India’s Proposed Digital Competition Act,” Competition Commission of India Journal on Competition Law and Policy, Vol. 5, No. 1 (2024), pp. 79–104, available at: https://ccijournal.in/index.php/ccijoclp/article/view/197 (last visited on Apr. 17, 2025)
[2]Anuncia William &Khule, “Validity of the SSNIP Test to Delineate the Relevant Market in the Digital Economy,” Jus Corpus Law Journal, Vol. 2, Issue 3 (Mar.–May 2022), available at: https://www.juscorpus.com/wp-content/uploads/2022/03/3.-Anuncia-William.pdf (last visited on Apr. 17, 2025).
[3] Singh, R., “CCI v. TRAI: Regulatory Framework for Better Coordination and Interoperability,” Competition Commission of India Journal on Competition Law and Policy, Vol. 4, No. 1 (2023), pp. 77–91, available at: https://ccijournal.in/index.php/ccijoclp/article/view/84 (last visited on Apr. 17, 2025)