Regulating Unfair Trade Practices: an Analysis of the Past and Present Indian Legislative Models

Abstract

The Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act) which for the first time incorporated detailed provisions as to unfair trade practices (UTPs) in India has now been repealed and succeeded by the Consumer Protection Act, 1986 which has included the same substantive definition of UTPs. This article analyses the law as to UTPs under the repealed MRTP Act including the cases decided thereunder and compares it with the structure of the Consumer Protection Act with the objective of evaluating whether the present Consumer Dispute Redressal Agencies under the Consumer Protection Act have adequate substantive provisions and effective procedural competence to ward off UTPs. Our analysis of legislative provisions and decided cases shows that the present system of protection against UTPs under the Consumer Protection Act is blighted by a strict and restrictive definition of consumer; lack of in-house enquiry and investigation system, incompetency of traders and trade associations to pursue cases, and lack of inherent power of the Consumer Dispute Redressal Agencies to suo motu take up matters. The article uses analytical and statistical methods to quantify, in terms of actual effect, these drawbacks which significantly hamper the present system and suggests various means to improve the functioning of the system so as to effectively deal with UTPs.