Consumer Protection Act &Competition Act 2002: Background, definitions-consumer,consumer dispute,complaint,deficiency,service,consumer protection council,consumer redressal agencies,district forum,state commission and national commission; Competition Act: Meaning and scope,salient features, terms, competition commission of India,offences and penalties under the act.

1. Unit 5
Consumer Protection Act
Competition ACT 2002

2. Monopoly
HIGH Price
Unawareness
Supply
Demand
Misleading Ad

3. Applicable
GOODS & SERVICE

4. Jargons
RESTRICTIVE TRADE
PRACTICE
SPURIOUS GOODS &
SERVICES
DEFECT
CONSUMER DISPUTE

5. REQUIREMENTS FOR COMPLAINT
Filed Within Two Years
Name And Address Of The Person
Copies Of Relevant Documents
Details : Problem And
The Demand

6. CONSUMER PROTECTION COUNCILS
It consists of (a) the Minister in charge of the consumer affairs
who shall be its Chairman
Procedure for meetings of the Central Council.-
The Central Council shall meet as and when necessary, but at least one
meeting of the Council shall be held every year.

7. State CONSUMER PROTECTION COUNCIL
• It Consist of:
• The Minister in charge of consumer affairs in the State Government
who shall be its Chairman
• other official or non-official members, not exceeding ten, as may be
nominated by the Central Government.
Procedure for meetings of the State Council:
• The State Council shall meet as and when necessary but not less than
two meetings shall be held every year.

8. DISTRICT CONSUMER PROTECTION COUNCIL
• It shall consist of the following members
• (a) The Collector of the district, who shall be its Chairman
Procedure for meetings of the district Council:
The District Council shall meet as and when necessary but not less than
two meetings shall be held every year.

9. CONSUMER DISPUTES
REDRESSAL AGENCIES
DISTRICT FORUM
STATE COMMISSION
NATIONAL COMMISSSION

10. District Forum
• These forum are set by the district of the state concerned in each
district wherein it consists of President and two members of which
one should be a woman and is appointed by the State Government.
• In this, the complaining party should not make a complaint more
than 20 Lacs and once the complaint is filed the goods are sent for
testing and if they found defective the accused party should
compensate and if the party is dissatisfied can make an appeal with
state commission within 30 days.

11. State Commission
• This is set up by each state It consists of President and two
members.
• Complains should be at least 20 lacs and exceed not more than 1
crore.
• The goods are sent for testing and if found defective are asked for
replacement or compensation. If not satisfied can make an appeal
within 30 days in front of the National Commission

12. National Commission
Consist of President and 4 members.
The complaint must exceed an amount of 1 crore.
The goods are sent for testing and if found defective are asked for
replacement or compensation.

13. Appeal
• Appeal is a legal instrumentality whereby a person not satisfied with the
findings of a court has an option to go to a higher court to present his case
and seek justice.
• An appeal can be made with the state commission against the order of
the district forum within 30 days of the order which is extendable for
further 15 days.
• An appeal can be made with the National Commission against the order
of the state commission within 30 days of the order or within such time as
the National Commission allows
• An appeal can be made with the Supreme Court against the order of
the National Commission within 30 days of the order or within such time
as the Supreme Court allows.

14. Penalties
If a defaulter does not appear in court despite notices and
reminders, the court may decide the matter in his absence.
The forum can sentence the defaulter to a maximum of
three years' imprisonment and impose a fine of Rs. 10,000.

15. WHO is CONSUMER
• Any person who buys any goods, whether through offline or
online transactions, electronic means, teleshopping, direct
selling or multi-level marketing.
• The district forum can now entertain consumer complaints
where the value of goods or services paid does not exceed
INR 10,000,000.
• The State Commission can entertain disputes where such
value exceeds INR 10,000,000 but does not exceed INR
100,000, and the National Commission can exercise
jurisdiction where such value exceeds INR 100,000,000.
• The act proposes the establishment of a regulatory authority
known as the Central Consumer Protection Authority.

16. Competition Act
• MRTP ACT, 1969 :For Prohibition
of Monopolistic, Unfair &
Restrictive Trade Practice
• Establishment of a Commission to
prevent adverse effect on
competition. *Promotion and
sustenance of competition in the
market. *Protection of
consumers’ interests. *Freedom
of trade.

17. Jargons
ANTI-COMPETITIVE
AGREEMENTS
BID RIGGING
CARTEL
Exclusive supply
Agreement
PREDATORY PRICE

18. Vertical
Agreement
Vertical Agreements:
Agreements between
enterprise at different stage
of production , distribution
etc. Agreement includes
arrangement or
understanding, oral, or in
writing, not necessarily
enforceable by law

19. Vertical Agreement: TYPES
1. Tie-in arrangement : Agreement between manufacturer and distributor not to
sell manufactures product at or above a price floor at or below a price ceiling
2. Exclusive supply arrangement: Agreement restricting the purchase in course of
trade from acquiring the goods of trade from acquiring the goods of any other
seller
3. Exclusive distribution arrangement :Agreement to limit or restrict the output
or supply of any goods to ant market or area
4. Refusal to deal: Any agreement which restrict or is likely to restrict by any
method any person/classes of persons to whom goods are sold or from whom
goods are brought
5. Resale price maintenance: Any Agreement to sell goods on condition that the
price to be charged on the resale by the purchaser shall be stipulated by the
seller unless it is clearly stated that prices lower than those price may be
charged .

20. Horizontal Agreement
1. Price Fixing Agreement: Agreements that determine purchase or
sale prices are void
2. Market sharing: When competitors divide/allot the market amongst
themselves in various ways and agree to deal only in their allotted
segment of the market.
3. Bid rigging: Agreements that eliminate or reduce competition for
bids or manipulate the process for bidding.
4. Cartels: Agreements between enterprises on not to compete on
price, product (including goods and services) or customers

21. Prohibition of Agreement
ANTI-COMPETITIVE AGREEMENTS
No enterprise or person or association of persons shall enter into any
agreement in respect of production, supply, distribution, storage,
acquisition or control of goods or provision of services, which causes or
is likely to cause an appreciable adverse effect on competition.
Types: Horizontal & Vertical Horizontal Agreements - Agreements
between enterprises at the same stage of production. It can be
between 2 competitors. Vertical Agreements: Agreements between
enterprise at different stage of production , distribution etc. Agreement
includes arrangement or understanding, oral, or in writing, not
necessarily enforceable by law

22. Regulation of Combination
• Combination includes acquisition of control, shares, voting rights or assets,
acquisition of control by a person over an enterprise where such person has
control over another enterprise engaged in competing businesses and mergers
and amalgamations between or amongst enterprises
• *If a combination causes or is likely to cause an appreciable adverse effect on
competition within the relevant market in India, it is prohibited and can be
scrutinized by the Commission.
• *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
• *Any person or enterprise, who or which proposes to enter into a combination,
must give notice to the Commission by disclosing the details of the proposed
combination.
• *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

23. Combination Types
Horizontal combinations :These are those that are between rivals and are
most likely to cause appreciable adverse effect on competition. Ex-
Associated cement company with Damodar cement
Vertical combinations :These are those that are between enterprises that
are at different stages of the production chain and are less likely to cause
appreciable adverse effect on competition. Ex-Time warner Incorporated
and turner corporation
Conglomerate combinations :These are those that are between enterprises
not in the same line of business or in the same relevant market and are least
likely to cause appreciable adverse effect on competition. EX-Walt Disney
Company and american broadcasting company

24. Competition Commission of India
• The Competition Commission of India is an independent body who
are tasked with sustaining and promoting the interests of consumers
in order to foster an ideal environment for economic competition

25. Functions
1) To prevent practices having adverse effect on competition
2) To promote and sustain competition.
3) To protect the interest of consumers
4) To ensure freedom of trade carried by market participants in
markets in India
5) To give opinion on competition issues

26. Competition Commission Of India
• 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.
• 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.
• *All members of CCI is public servant and have protection for action
taken in Good faith.

27. Penalties Under Competition Act
Failure to notify a reportable combination
• Fine of up to 1% of combined turnover or assets whichever is higher.
Failure to comply with directions of CCI
• Fines of 1,00,000 per day subject to a maximum of 1 crore.
Person does not comply with the orders or directions issued, or fails to pay the fine imposed:
• he shall be punishable with imprisonment for a term which may extend to three years, or with
fine which may extend to rupees twenty-five crore or with both.
Penalty for making false statement or omission to furnish material information
penalty which shall not be less than rupees fifty lakhs but which may extend to rupees one crore.
Person wilfully alters, suppresses or destroys any document which is required to be furnished
• fine which may extend to rupees one crore as may be determined by the Commission.