CCI notifies the Competition Commission of India (Lesser Penalty) Regulations, 2024

The Competition Commission of India (the “CCI”), vide notification dated 20th February 2024 has introduced The Competition Commission of India (Lesser Penalty) Regulations, 2024 (the“Regulations”) in supersession of the earlier Competition Commission of India (Lesser Penalty) Regulations, 2009. The Regulations give effect to the concept of “lesser penalty plus” as introduced through a recent amendment to Section 46 of the Competition Act, 2002 (the “Act”). In April 2023, Section 46 was amended to introduce the concept of a “lesser penalty plus”. The concept takes into consideration a situation where, during the course of an ongoing investigation, a person who earlier made a disclosure about a cartel, makes a full, true, and vital disclosure about the existence of another cartel alleged to have entered into anti-competitive agreement(s). It entitles the CCI to impose upon such person, a lesser penalty prescribed in the Regulations in respect of the cartel already being investigated by it, in addition to such person seeking a lesser penalty in respect of the newly disclosed cartel. In terms of the Regulations, any enterprise, which is or was a member of a cartel (including an individual involved in the cartel on behalf of an enterprise) and further including an enterprise/association of enterprises/ person/association of persons, though not engaged in identical or similar trade, if it participates or intends to participate in the furtherance of such cartel, may apply to the CCI seeking a lesser penalty in consideration for making a full, true, and vital disclosure about a cartel alleged to have contravened the provisions of Section 3 (Anti-competitive agreements) of the Act. Lesser Penalty Plus Regulation 5 provides that an applicant who had earlier made a full, true, and vital disclosure about a cartel (first cartel) violating the provision of Section 3 of the Act, and during the course of the investigation against such first cartel, makes a disclosure about another cartel (second cartel), shall be eligible to receive an additional reduction of up to 30% in the monetary penalty imposed upon such applicant with respect to the first cartel. This reduction shall be in addition to a potential 100% reduction in the penalty liable to be imposed upon the applicant in case of the second cartel. However, the disclosure made by the applicant with respect to the second cartel must be substantial enough for the CCI to form a prima facie opinion regarding the existence of a second cartel. Further, such a second cartel must be clearly distinguishable from the first cartel.