We have been seeing lots of Mergers and acquisitions deals which were entered by the commercial companies such as Ed-tech companies etc. One of such examples can be seen through the recent acquisitions made by Reliance Industries and even BYJU’S. What would be the main reason for Reliance and BYJU’S to enter into this deal? Does it affect the competitive market? Who will be the beneficiaries in case of the market with the competition? This guide/article will be looking into the Competition advocacy and foreign legislations, which are relating to it.

Nature of Competition law:

Before looking into what competition advocacy means, it is important to know what the competition law does and what the functions of the competition authorities are. Competition law or a competition policy helps in the promotion of good governance both in the private enterprises as well in the public/governmental aspects by decreasing the available opportunities for rent-seeking behavior and the kind of corrupted behavior that accompanies the same. Protection of an entity, especially the company or the concerned firm, from a market failure is the most important objective of competition law. If we assume that there is no regulation at all in a market and meanwhile market fails. Now, the government has the duty to specifically intervene in this scenario and then deal with the issue accordingly. Competition law enables this power to the government, but in the absence of the same, then there will be an arbitrary exercise of power by the government if no regulations like competition law exist.

What is Competition Advocacy?

Having known what the competition law does and the authorities do, it has parallel importance in looking at competition law and competition advocacy. Competition advocacy would generally refer to the idea or the concept of promotion of competition principles in any policy-related debate and regulatory processes under the competition principles with the various stakeholders of the society, which basically includes Government, Civil society at large, public, and even private entities. It, in a way, embodies the objective of competition set by the competition policies and laws and also advocating a competition-led market culture. Many scholars and researchers in competition law argue that competition advocacy and competition enforcement should be interconnected as the enactment of competition law and constitution of competition authorities under the specific enactment is itself a part of competition advocacy. But the same has been rebutted by saying that there is no public involvement in the case of decisions made by competition authorities.

Competition advocacy in India:

India witnessed the emergence of competition advocacy through its enactment of the Competition Act in the year 2002 in order to regulate the effective competition within the Indian market by abolishing way old legislation of Monopolies and Restrictive Trade Practice act of 1969 (MRTP Act). The Indian Competition act and policies have given due importance to competition advocacy through provisions that specifically focus on newly creating and enabling the expansion of the Indian market. Since Competition advocacy is more to do with various stakeholders of the society and not mere the competition commission in India, the Competition Act, 2002 enabled the provisions to focus and recognize the importance of various stakeholders. This has been based on three main steps of the commission, as per the resources. They are policymakers (i.e. the central and the state governments), sectoral regulators as per their regulations, and lastly, and most importantly, the ultimate beneficiary in these regulations, that is the Public at large.

Foreign Legislations on Competition Advocacy:

It has to be noted that the procedures that are prevailing in more countries establish and enable a regularized review and a comment on the legislation proposed by the competition agency of the concerning country. It is reported that there would be no use for the competition agency to analyze and discuss all the legislations that are proposed and enacted by the parliament in its legislative sessions. The need for regulation through the concept of competition law and policy intersects with the competition advocacy where the stakeholders take part in the welfare of the market as a whole.

International Competition Network (ICN), one of the important International networks on competition law, had decided to perform a study on competition advocacy in order to analyze the importance of competition advocacy across the global countries with enhancing competition markets and for the promotion of the welfare of the society. As per the report by International Network, it defines Competition advocacy as,

“Competition advocacy refers to those activities that are conducted by the competition authority related to the promotion of competitive environment for the enhancement of economic activities by means of non-enforcement mechanisms, especially through its relationships with the secondary or other governmental entities and by increasing the awareness of the benefits of competition.”

It is clear that in order to attain that objective of promoting, supporting, and analyzing the nature of competition advocacy, the International Competition Network has established an Advocacy working group within it. A similar perspective can be witnessed in the United States where the Federal Trade commission enables the concept of competition advocacy.
Looking from foreign legislation perspective, research conducted on Serbian Competition advocacy has shown an advantage over the others relating to competition advocacy because of the fact that they induce several advocacy tools and methods to enable a market with competition and has influenced the policymakers through its Law on Protection of Competition.

Conclusion:

As we have seen and analyzed, it is clear that competition advocacy as an imminent tool in promoting and preventing the monopolistic market has been shown and regarded as inevitable in almost all the jurisdictions across the global territories. It serves the purpose of the welfare state through its regulations. With respect to India, the regulators are specified with the duties to notify the competition commission even before the advocacy takes place or is directed towards the competition.