In a development that can have implications on the extent of Trai’s sphere of influence in determining issues such as predatory pricing and abuse of market dominance, the Competition Commission of India (CCI) has told the sector regulator that assessing such aspects are its “exclusive” domain. Drawing the attention of Trai chairman R S Sharma on the consultation paper, regulatory principles of tariff assessment, CCI chairman Devender K Sikri said the fair trade regulator has the mandate to not only promote and sustain trade, but also check practices that adversely impact competition in the market across sectors, including telecom.
Sikri, in the letter, said CCI’s observations are limited to the chapter on anti-competitive behaviour in tariff orders in the consultation paper issued by Trai. “The discussion in the chapter relates to anti-competitive behaviour in the form of predatory pricing by dominant enterprises. The chapter sets out a range of issues and questions for consultation relating to delineation of relevant market, assessment of dominance and predatory pricing. As per the provisions of the Competition Act, these are issues for determination by the commission,” Sikri pointed out.
Trai had floated the consultation paper in February and discussed the issues with the telecom operators and the stakeholders in an open house in May. It is now in the process of coming out with its regulations and recommendations.
It assumes importance as the issues that were discussed — promotional offers, predatory pricing and market dominance — form core of the dispute between Bharti Airtel, Vodafone India and Idea Cellular on one side and the new entrant Reliance Jio on the other. While Airtel and Idea have challenged Jio’s promotional offers before the TDSAT, Vodafone has moved the Delhi High Court.
Sikri said the Competition Act defines relevant market — product and geography — and lists factors that are to be considered while identifying these factors.