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Introduction
Competition law is an integral part of the regulatory framework in Indian economy. Competition increases economic efficiency, and enhances consumer welfare ([1] Dhall, 2005):
The aim of the Competition Commission of India (CCI) is to make markets work well for consumers through effective competition. The advantages to various sectors arising out of competition should percolate to consumers and businesses for a level playing field, redressing against anti-competitive practices, ensuring competitively priced inputs and optimal realization from sale of assets ([2] Kumar, 2011).
It is stated by Hon'ble Supreme Court of India in Competition Commission of India v. Steel Authority of India Ltd [1] that both "competition law and policy" and the CCI are at a very nascent stage within the broad regulatory matrix of the Indian economy. The main purpose of writing this article is to trace the extra-territorial jurisdiction of CCI.
The object behind enacting the Competition Act 2002 (hereinafter referred to as "the Act") was to provide for keeping in view, the economic development of the country, the establishment of a commission to prevent practices which have an adverse effect on competition, to promote and sustain competition in markets, to protect the interests of consumers and to ensure freedom of trade carried on by other participants in Indian markets, and for matters connected therewith or incidental thereto ([3] Object to the Competition Act, 2002). Section 32 of the Act gives CCI power to enforce Indian Competition law against the foreign entities whose action have "appreciable adverse effect" on competition in the relevant Indian market. The question will be whether CCI will be able to use the power provided under the Act to control international mergers which are being promoted and protected by their own governments[2] , if such international mergers are having an adverse effect on competition in the Indian market?
Extra-territorial jurisdiction
The rules of establishing jurisdiction and extra-territorial effect of the domestic laws differ from country to country. Generally speaking in the absence of international competition policy, countries search for a national solution by applying their domestic laws to the foreign parties. In the globalized economy, it is necessary to have extra-territorial application of domestic competition law to regulate the anti-competitive activities of foreign firms taking place in the foreign...