CAN NON-DOMINANT ENTITIES BEHAVE DOMINANTLY: REVISITING THE CONTOURS OF PREDATORY PRICING UNDER INDIAN COMPETITION LAW.

Abstract

Predatory pricing policy in India is at crossroads with Jio becoming the largest player in the wireless telecommunication market and reducing the market to a triopoly. There is a need for the Competition Commission of India to reflect on its enforcement policy under Section 4 of the Indian Competition Act, 2002. The article starts by exploring the concept of predatory pricing and why it remains a contested concept. The second part of the paper argues the need for revisiting the dominance requirement to initiate an investigation under Section 26 read with Section 4 of the Indian Competition act by drawing inferences from US and France antitrust law. It shall discuss in detail the need for adopting an attempted monopolization benchmark for cases of predatory pricing. The third part proposes two thresholds (a) common market share and; (b) proof of exclusion, that the commission can adopt in order to differentiate legitimate promotional pricing from illegitimate predatory pricing. The article questions the major premises on which predatory pricing abuse can be invoked. It will be illustrated, that a non-dominant entity can achieve the same result of distorting competition as a dominant entity can, by predation. In particular, it will be argued that for an entity to commit predation, market power is not a prerequisite instead the commission must look at the effect in the market. Therefore, the Competition Commission of India is well advised to revisit the prerequisite of dominance for predatory pricing wrongs.