In 1951, India implemented its first five-year plan, where it institutionalised the role of the state in directing capital towards national priorities. The following decades saw this approach create an economy that had the license-raj and dominated by state-owned public-sector companies. However, the 1991 liberalisation reform marked a structural shift where the state started retreating from running businesses and instead became an enabler, creating regulatory institutions, attracting private investment, and creating competitive markets.
More than 70 years later since the first plan, India functions in a starkly different economy – aspiring to a $5 trillion GDP and asserting itself as a digital powerhouse. But a familiar bottleneck threatens to trip the momentum: antitrust gridlock.
While the West, led by the US and EU, has turned to negotiated settlements to resolve competition disputes with speed and predictability, India remains wedded to a slower enforcement playbook. Investigations drag on for years, freezing capital, deterring innovation, and entangling high-growth sectors in procedural knots. Robust enforcement is not in question. What India needs is the Competition Commission of India (CCI) to ensure its enforcement is smart, time-bound, and pro-growth.
Casualties of Delay: Innovation and Capital
India’s economic trajectory is stimulated by high-growth, capital-intensive sectors such as digital technology, e-commerce, logistics, fintech, and consumer retail. These industries depend on fast decision-making and continuous innovation. Yet, many of them are caught in regulatory limbo due to ongoing competition probes that stretch for years.
Even the Finance Ministry, earlier this year, convened a meeting of all stakeholders to discuss the delays and inaction despite industry escalations. Several government departments expressed broad consensus that such delays, often taking up 2 to 5 years, carry serious consequences. Pending investigations, regardless of outcome, cast a shadow on mergers, dissuade investors, and force firms to shelve expansion plans.
Startups, in particular, bear the brunt. Prolonged antitrust investigations deplete their thin limited resources, sap executive bandwidth, and often force premature market exits. Unlike large tech firms with deep legal benches, emerging companies are ill-equipped to endure years of regulatory limbo. The result is a lopsided digital economy where ability to defend a business model becomes a function of scale, not merit.
International Best Practices: Learning from the EU and the US
Globally, settlement and commitment mechanisms are the foundational tools of modern competition regulation. The European Commission, under Article 9 of the EU Antitrust Regulation, regularly employs commitment decisions to resolve competition concerns swiftly without establishing formal guilt. These mechanisms allow companies to voluntarily work on remedies, which are then made binding without admitting guilt. This helps in saving litigation time and restoring market confidence.
The Google Shopping case in the EU is a good example. While the EU initially fined Google €2.4 billion, it was followed by multiple settlement-style engagements that shaped ongoing conduct remedies and market adjustments.
In the United States, the Federal Trade Commission (FTC) and Department of Justice frequently enter consent decrees that are negotiated settlements.
A Legal Precedent Already Exists
India’s own regulatory architecture offers encouraging precedents. The Securities and Exchange Board of India (SEBI) introduced a settlement mechanism in 2007, which has since evolved into a robust framework wherein entities could choose to resolve violations without prolonged litigation. Similarly, the Reserve Bank of India (RBI) uses compounding mechanisms under FEMA to settle certain contraventions, hence prioritising efficiency over punishment.
Even the Competition Law Review Committee (CLRC), in its 2019 report, recommended introducing settlement and commitment mechanisms to CCI’s enforcement mechanism. The draft Competition (Amendment) Bill 2022, now enacted into law, includes provisions for these mechanisms. However, the on-ground implementation has been slow, and guidelines are still pending. The intent exists, it is time for execution.
Infusing Capital Through Regulatory Certainty
A transparent and time-bound settlement mechanism can create a virtuous cycle of compliance and investment. First, it reduces the adversarial nature of enforcement by encouraging cooperation. Second, it provides clarity to markets, allowing businesses to plan growth without second-guessing compliance. Third, it frees up CCI’s resources to pursue egregious or systemic violations more aggressively.
For global investors, India’s digital economy is a key investment destination, as the country is home to the third largest number of unicorns globally. Yet, these investors increasingly cite regulatory unpredictability as a major risk factor. A functional settlement regime, similar to those abroad, would go a long way in addressing this.
Consider a hypothetical case where an e-commerce company accused of exclusive dealing voluntarily agrees to modify its contracts within 60 days, pays a calibrated penalty and avoids a four-year legal drag. This unlocks capital to flow back into innovation rather than legal defence, enabling the sector to mature responsibly.
This is not to discount the institution competence the CCI has already displayed in the past years.
Ensuring Accountability Without Compromise
Critics may argue that settlements allow violators to “escape.” That is a false dichotomy. Well-designed settlement frameworks incorporate rigorous disclosure, enforceable commitments, and monetary penalties where appropriate. They do not substitute enforcement - they enhance it by making it more effective and credible. Settlement is not a sign of regulatory weakness; it is a sign of maturity.
Moreover, CCI can calibrate thresholds which could allow settlements only for non-cartel, unilateral conduct cases, or for first-time offenders, while retaining full enforcement powers for cartels or repeat violations. Such tailoring preserves deterrence without paralysing businesses.
The Time is Now
India stands at a critical juncture. With a $5 trillion economy on the horizon and a surging digital economy, every policy lever must be aligned to the ongoing growth momentum. CCI, as the guardian of market fairness, must evolve with the times.
A well-defined, time-limited settlement framework is not a departure from regulatory vigilance, it is the scaffolding on which trust, investment, and innovation can be built. This is not merely a legal reform. It is a structural necessity.
Imagine a regime where competition disputes are resolved in 90 days, where companies can innovate without fear of regulatory limbo, and where capital flows to creation, not litigation. That is the ecosystem the CCI can — and must — deliver. A smart settlement mechanism doesn’t let violators off the hook — it lets India off the leash.
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