The Competition Commission of India's (CCI) recently introduced settlement and commitment regulations haven't been used yet, but industry experts predict they will become a popular tool to avoid dragged-out litigation.

These regulations, notified in March 2024, are part of the Competition (Amendment) Act, 2023. They offer a faster and more streamlined process for companies under investigation by the CCI for potential anti-competitive practices or dominance abuse.

Sources close to the commission confirmed that no business entity has approached the Director General, the investigative arm of the CCI, to utilize these new settlement options. This is likely because the regulations are very recent, and companies may still be unfamiliar with them.

However, both legal and industry experts believe these regulations will be widely adopted in the future. They were met with positive reactions when proposed, particularly from technology companies that have faced increased scrutiny from the CCI in recent years.

How the Settlement Process Works

The new regulations establish a time-bound process. Businesses under investigation by the CCI can propose a settlement and offer specific commitments to address any competitive concerns. This allows them to avoid a formal investigation report and potentially significant penalties.

The settlement process is voluntary, but it offers a clear path for companies to comply with the Competition Act and rectify any anti-competitive behavior. It's important to note that this option is not available to companies suspected of involvement in cartels, which are agreements between businesses to fix prices or limit production.

Benefits of Settlement

The new framework offers significant advantages for both businesses and the CCI.

• Reduced Litigation: Businesses can avoid lengthy and expensive court battles, saving time and money.
• Faster Resolutions: Settlements can resolve CCI investigations quicker, freeing up resources for both parties.
• Efficient Enforcement: The CCI can address anti-competitive practices more efficiently by focusing on complex cases that require full investigations.

While the initial lack of applications isn't surprising due to the newness of the regulations, experts anticipate a surge in their use as companies become more familiar with the process. The potential benefits for both businesses and the CCI in terms of faster resolutions and reduced litigation costs are significant.

The long-term impact of these regulations will depend on how effectively they are implemented and enforced. If they prove successful, they could become a valuable tool for promoting a competitive business landscape in India.