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        Law of Competition

        2015 (3) TMI 547 - HC - Law of Competition

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        Preliminary competition investigation stage allows further inquiry without hearing the enterprise before an order under Section 26(7). Section 26(7) of the Competition Act was treated as a preliminary, inquisitorial stage distinct from the prima facie and report stages, so the Competition ...
                      Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.

                          Preliminary competition investigation stage allows further inquiry without hearing the enterprise before an order under Section 26(7).

                          Section 26(7) of the Competition Act was treated as a preliminary, inquisitorial stage distinct from the prima facie and report stages, so the Competition Commission was not required to issue notice or hear the enterprise before ordering further investigation. The statutory text was read as confining objections or suggestions at the relevant earlier stage to the informant or referring authority, and Regulation 2(1)(i) could not expand that entitlement. The prior Supreme Court ruling on Section 26(1) was applied by analogy because the further-investigation order did not itself determine rights or impose civil consequences. The enterprise therefore had no right of hearing before the order was passed.




                          Issues: Whether the Competition Commission was required to give notice and hear the enterprise against whom information was filed before directing further investigation under Section 26(7) of the Competition Act, 2002.

                          Analysis: The statutory scheme of Section 26 distinguishes the prima facie stage under sub-section (1), the report stage under sub-sections (3) to (6), and the stage of further investigation under sub-section (7). The language of Section 26(5) confines invitation of objections or suggestions to the informant or the referring authority, and does not include the enterprise against whom information is received. The earlier decision of the Supreme Court on Section 26(1) was held applicable by analogy to the further investigation stage, because that stage also remains preliminary, inquisitorial, and non-adjudicatory, and does not by itself determine rights or impose civil consequences. Regulation 2(1)(i) could not control the meaning of the statute. The order directing further investigation was also distinguished from an order commencing inquiry after a formed opinion of contravention.

                          Conclusion: The enterprise had no right to be heard before an order under Section 26(7) directing further investigation was passed.


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