Financial Daily from THE HINDU group of publications
Saturday, Jan 19, 2002
Jaitley calls for debate on amnesty chapters
NEW DELHI, Jan. 18
THERE is an urgent need for serious discussion on the methodology that needs to be incorporated in the Competition Bill towards dealing with an offending party, particularly with the abuse of dominance, according to Mr Arun Jaitley, Union Minister for Law, Justice and Company Affairs.
Speaking at a symposium on corporate laws, organised by the Federation of Indian Chambers of Commerce & Industry (FICCI) on Friday, he said that in this regard, several countries in the world have leniency chapters, or amnesty chapters as they are known in India.
The suggestion to have amnesty chapters in the draft legislation on competition has already been forwarded to the Chairman of the Standing Committee Examining Competition Bill 2001, and a large-scale debate is invited on this issue, the Minister said.
"In order to curb anti-competition practices, the issue is - do you go for a full scale investigation detecting cartels or do you give the offending party an option in the first instance to appear on day one and make a clean breast of what it has done,'' Mr Jaitley added.
In this regard, heavy financial penalties are imposed - which seems to have worked well in some countries, he said. The issue needs careful examination and debate before it is incorporated in the draft Bill, he added.
Delineating three broad aspects of Competition Law, Mr Jaitley said that it has elements to prohibit anti-competitive agreements, deal with abuse of dominance (predatory pricing) which needs to be penalised, and the issue of merger and amalgamations. The Minister also agreed with the suggestion that there was no need to rush through the Competition Law.
He also allayed the corporate sector's fears over the Companies (Amendment) Act, 2000 relating to public deposits - particularly the provision of Section 274 (1)(g) regarding disqualification of directors - saying that only those directors who defaulted the provisions of the Companies Act would be disqualified.
Further, the Minister also called upon corporate managers to introspect, since 80 per cent of the profit-making companies do not declare dividends, which "looks a little depressing".
He urged them to consider the plight of investors in NBFCs, plantation companies and others.
Mr Jaitley also reiterated that the legislation was a meaningful one and intended to protect the interest of investors and shareholders.
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