Introduction

This paper explores the interplay between leniency, settlement and commitment as a means of non-adjudicatory enforcement, which has been seen as central to the modern competition regulation by offering faster resolutions in antitrust cases. The introduction of settlement and commitment into India's competition law, along with the existing leniency mechanism, marks a significant shift towards an efficiency-oriented enforcement model, yet this poses a strong policy tension: can multiple voluntary compliance mechanisms weaken overall welfare outcomes, or can they coexist without diluting deterrence?  While leniency is a program that incentivises by granting immunity or reduced fines to the cartel members who confess to the anti-competitive behaviour.[1] Whereas, reduced administrative burden and speedy resolution are achieved through settlement and commitment. These three mechanisms may overlap when there’s simultaneous availability, causing potential enforcement inconsistencies or strategic behaviour risks. This essay shows the interplay between leniency, settlement, and commitment procedures in India and contends that these tools can function together only if calibrated through clear sequencing, eligibility filters, and welfare-based design principles. The essay offers a reform-oriented framework to ensure that non-adjudicatory enforcement is strengthened by analysing comparative experience and identifying emerging incentive conflicts.

Rationale behind the non-adjudicatory enforcement in competition law.  

Because non-adjudicatory means of enforcement (i.e., leniency, settlement, and commitments) provide an alternative to adjudicatory means, such as lengthy and adversarial proceedings, for deterring and correcting market behaviour, they are a fundamental aspect of competition law today. The traditional method of using adjudicatory enforcement to deter and correct market behaviour involves a slow, resource-intensive process to investigate complex, global digital markets; the courts are often unable to dispose of these cases due to their lengthy, complicated nature. Therefore, the introduction of non-adjudicatory enforcement mechanisms does not merely reduce adjudicatory backlog; it also reshapes enforcement incentives. Unlike traditional adversarial proceedings that culminate in punitive findings after prolonged investigation, leniency, settlement and commitment procedures link regulatory outcomes to voluntary disclosure, negotiated remedies and cooperation. Under Section 46 of the Competition Act and Sections 48A and 48B introduced by the Competition (Amendment) Act, 2023, outcomes are conditioned on cooperation rather than solely on unilateral fact-finding. In this way, enforcement moves from a purely retrospective and punitive approach toward one that emphasises negotiated compliance and timely market correction, similar to the model adopted in the European Union under Article 9 of Regulation 1/2003. In particular, leniency allows cartel participants to receive immunity or reduced penalties in exchange for disclosing their participation in the cartel while, under the Settlement Regulations 2024, based on Section 48A, settlements promote cooperation and the acceptance of findings after an investigation instead of requiring the regulators to prove the evidence necessary to support their findings and commitments under section 48B allow for a resolution of disputes before the regulators even prove that a business engaged in an unlawful activity. Consequently, these non-adjudicatory tools provide significant savings in time and costs associated with procedural and investigative matters, ultimately benefiting a jurisdiction such as India, which is experiencing an increasing case load with regard to the CCI.       Additionally, these mechanisms moderate the risk of over-deterrence that can arise from prolonged uncertainty and severe ex post penalties. Economic scholarship on antitrust enforcement cautions that unpredictable sanctions and extended investigations may chill legitimate competitive conduct, particularly in innovation-driven sectors such as technology and pharmaceuticals, where business models evolve rapidly. By allowing negotiated remedies tailored to the specific competitive harm rather than imposing uniform punitive sanctions settlement and commitment frameworks enable regulators to correct market distortions while preserving incentives for lawful innovation and continued investment. As a result, India is now better aligned with more developed jurisdictions, such as the EU, the US, and Brazil. 

Because non-adjudicatory methods offer organisations greater predictability than current methods of adjudicatory enforcement, they will lead to increased voluntary compliance and reduced chances of repeat violations. Therefore, the primary advantage of non-adjudicatory methods is the ability to restore competitive market conditions faster than delayed punitive orders; thus, protecting consumer welfare more efficiently.

Leniency’s Unique Deterrence Logic and the Need for Preserving First-Mover Advantage

The concept of leniency is unique in that it is the only form of non-adjudicatory enforcement that is based on the deterrent effect of disrupting cartel activity. Leniency operates by incentivising cartel members to act quickly and report their co-conspirators to the CCI (Competition Commission of India). The first-mover strategy not only gives cartel members an advantage over their co-conspirators, but it is also a tool for removing the trust between cartel members that enables cartel operations. There is strong support from comparative jurisprudence for the proposition that leniency is an effective means of detecting cartel activity, as demonstrated by the EU cases of Pfleiderer, and Schneider Electric, which demonstrate that leniency applicants have been the most significant source of cartel detection and have discovered far more cartel conspiracies than settlements. Similarly, data from India shows that leniency has been successful in detecting cartel activities. The first leniency applicant received the highest penalty reduction in the case of in re: Cartelisation in the Faced Veneer Industry (2021).      The decision highlights how the priority marker system has materially affected case outcomes and encourages early reports for leniency by cartel participants. The recent implementation of the settlement and commitment processes has complicated these incentives. Because settlements can provide penalty discounts after evidence of wrongdoing has been presented by the cartel participant, and because commitments permit cartel participants to avoid any finding of violations, cartel participants may rationally take the approach of "waiting and seeing" versus self-reporting to the CCI for leniency. Cartel participants indeed face a countervailing risk in delaying self-reporting, namely, the possibility that another member may pre-emptively approach the Competition Commission of India and secure first-mover immunity. The fear of losing the priority marker is theoretically designed to destabilise cartels by undermining mutual trust. However, the introduction of settlement and commitment mechanisms alters this risk calculus. If enterprises perceive that settlement may still offer predictable penalty reductions without the extensive disclosure obligations, continuous cooperation requirements, and reputational exposure associated with leniency, the expected payoff from delayed cooperation may outweigh the first-mover risk particularly in tightly coordinated cartels where mutual silence is anticipated. In such circumstances, the availability of alternative resolution pathways may weaken the urgency that underpins leniency’s deterrence logic, even if it does not eliminate it entirely.

A multitude of options for participation in voluntary mechanisms may lead enterprises to behave less urgently toward self-reporting, using "strategic delay" as a way for them to take a gamble by waiting to see whether they would receive more favourable terms if they entered into settlement agreements or made a commitment rather than risk being second in line under the leniency program. Similar experiences in Chile and Brazil demonstrate the potential for overlapping programs to lead to confusion and decreased numbers of early admissions, encouraging regulators to clarify and establish a clear order to ensure that leniency maintains a higher priority.

For India, this lesson is paramount. Leniency is the only mechanism that increases an enterprise's chances of discovering cartels; it is not just an expedient way to resolve cartel cases, but it disrupts the very behaviour that competition legislation attempts to prevent. If settlement and commitment methods dilute the first-mover advantage or provide alternative, less-risky choices for enterprises, the overall welfare effect could be negative despite the procedural efficiency gains. Therefore, establishing a clear priority placement for leniency and ensuring that it has clear and defined sequencing rules and prohibiting cartel cases from entering into settlement and commitment agreements is essential to maintain significant deterrent effects and prevent non-adjudicators from becoming a menu of options for satisfying compliance strategies.

Settlement and Commitment: Benefits, Risks, and the Impact of JCB v. CCI

The Competition Commission of India has implemented the 2023 Amendments, which took effect in the 2024 Regulations, to create a cooperative enforcement structure and to reduce the administrative burden associated with compliance and expedite correction of market disruptions. The Regulation 5 commitment process allows businesses to present voluntarily behavioural and/or structural remedies that they intend to implement during the course of an investigation conducted by the Director General ("DG"). The Regulation 9 Settlement process allows a business that believes it violates applicable law to settle with the DG for an agreed-upon penalty reduction and to provide for the terms of the commitment in a legally binding contract. This methodology has been used in the EU and exemplified by the decision in Alrosa v. Commission, and is frequently used by the US Department of Justice as a way to quickly and efficiently resolve antitrust compliance. However, certain ambiguities and structural risks associated with the Indian regulatory framework are present and have been highlighted in the Fifty-Second Report of the Standing Committee on Finance. The Report noted that businesses still do not know if a settlement requires an admission of contravention, whether subsequent contraventions will be treated as repeat violations and the extent to which the agency can prescribe ongoing obligations to comply with third-party consultations.

This comes with a few problems. In this stage of commitment, when the DG Report is not yet available, too many of the allegations are not yet clear to the parties affected by the alleged wrongdoing. In some cases, the DG may even extend the investigation of a cartel matter into a case of abuse of dominance; therefore, the need for the release of the "Statement of Concerns" is particularly important to ensure that parties' commitments are not made based on speculation. Recently, in JCB India Ltd. v. CCI, the Delhi High Court issued a decision that will greatly undermine the effectiveness of the remedies available in the commitments process. The ruling provides the enterprise subject to investigation with access to the DG's internal communications, confidential findings, and other investigatory materials. In this way, the ruling converts a commitment or settlement mechanism from an informal to a quasi-adjudicative process. The primary advantage of the informal nature of these processes, certainty, expedited resolution, and fewer disputes, relies on limited access to information produced during the investigation and the negotiation of compliance in the settlement. Once the parties have full access to the investigatory record, they will no longer have the incentive to settle based on limited information; instead, they may decide to fight against the factual findings of the DG, file objections to the DG's conclusions, or strategically delay the resolution of their disputes by being informed of all evidence collected during the investigation.

Similar to the way EU courts imposed strict requirements on how businesses could regularly communicate with customers and suppliers, the courts of India have started placing a similar requirement on all businesses, creating more time-consuming and adversarial situations in which the businesses had less incentive to negotiate a settlement than to take the matter to court. This trend is even more pronounced in India, as businesses are at a much greater risk of becoming embroiled in lengthy litigation if they are deterred from negotiating a settlement due to an overly adversarial environment. Companies won’t be able to get an immediate market correction and instead would be forced to wait out the slow court process while waiting for an appeal. As a result, while there is great potential for settlements and commitments to improve administrative efficiencies in the JCB decision, the development of this case reduces the ability for parties to create efficiencies and increases the level of difficulty for many businesses, due to increasing uncertainty.

Overlapping Mechanisms and the Problem of Strategic Behaviour

The establishment of a multi-door enforcement framework through leniency, settlement, and commitment in India provides enterprises with multiple procedural options to resolve competition-related inquiries. While multiple and varied enforcement mechanisms can help to streamline enforcement, they can also create opportunities for strategic behaviour to occur when sequential and eligibility rules are unclear for each of the mechanisms. The Standing Committee's (2022-23) Report, included as part of your research expressions, references this issue. Specifically, stakeholders have expressed concern that if there is no clarity around admissions, penalties, recidivism, and behavioural remedy scope, companies may engage in "mechanism shopping," selecting the mechanism that appears to provide the least intrusive or least costly means of exit. This risk is heightened with respect to commitments because, at the time that commitments are offered, the Director General's (DG) report is typically not available, leaving parties without full visibility on the complete scope of issues raised, particularly since DGs are generally able to expand their investigations, occasionally re-characterising a case from a cartel investigation to an abuse of market power investigation. Due to the potential for invitations to commit at this point to be speculative or superficial, and likely more focused on bringing a swift conclusion to the investigation than on addressing the associated competitive harm, it is critical that the DG and the parties be able to provide clarity around this uncertainty.

The fear of strategic manipulation based on international experience has a history of growth. The work of the European Union and Steel Abrasives in 2014 illustrates how competitiveness sometimes results in entities switching from leniency to settlement solutions at some point during the course of processes, once it becomes apparent that settlements may provide more reliable or advantageous results than leniencies. Accordingly, clarifications from the European Commission through Notices to Stakeholders to No New Measures were issued, which prevented a form of forum shopping to make choices that directly hindered the incentive structure for "early self-reporting", which provides a means to detect cartel formation. There is evidence that companies operating in Korea have employed similar tactics, where they were delayed in providing incriminating evidence under leniency programmes due to the potential to receive more lenient settlement offers from the Korean Fair Trade Commission at a later time. The result of this pattern is continued systematic under-enforcement of the antitrust laws in Korea, leading to the adoption of severe sequencing rules, i.e. leniency is to be provided first, and settlements can be made for non-cartel abuses only. Similar vulnerabilities now exist for companies in India as they did before (Beer Cartel, 2018; Auto Spare Parts, 2014). In particular, companies that would have considered applying for leniency upon receipt of an application from the regulator may elect instead to settle their cases, as this way of settling disputes can provide certainty, does not require as much full and continuous disclosure, and often protects the company from a third-party litigation action. While companies seeking leniency must provide complete, continuous, and truthful cooperation, thus exposing themselves to potential liability for the actions of senior personnel, companies are able to negotiate narrow penalties and thus mitigate the risk of destabilising existing internal networks or providing the necessary evidence against their competitors. Thus, this inequitable situation creates an incentive for companies to postpone cooperation until the DG produces a report regarding the investigation, and then, if the report is favourable to the company, to settle the case. This issue is further emphasised in the Standing Committee report's observation that settlement may protect companies from reputational and collateral business consequences associated with the formal findings of contravention or leniency admission, e.g., disqualification from tenders, increased scrutiny from sectoral regulators.

Two forms of deterrence have been compromised by the CCI's strategic delay in enforcing cartel laws. First, predictable and manageable enforcement creates less urgency and surprise for cartels to destabilise; and second, leniency, the most effective way to increase detection rates, loses its "first-mover advantage."

If businesses can delay until the DG issues his report, the logical option for these businesses is not to voluntarily submit evidence until that point, and therefore, they will oftentimes wait to present evidence only after they receive the report. Historical evidence from Brazil supports this: when businesses learned that they could receive the same benefits from entering into a settlement as they would from submitting leniency applications, the number of leniency applications dropped by over 40% during the years of overlap between the two mechanisms.

Thus, although multiple mechanisms offer flexibility in enforcement, they need to be appropriately ring-fenced through sequencing and eligibility filters to be effective in meeting their intended objectives. The enforcement of sections 3, and 4 of the CCI Act should remain the primary enforcement mechanism for hardcore cartel cases, while settlements and commitments should only be used for non-cartel conduct and narrow or uncontroversial efficiency enhancement corrections. In the absence of these safeguards, the CCI would be changing its multi-tool enforcement framework from being a deterrent to being a means by which to provide a business with an advantage.

The Need for a Welfare-Centred, Sequenced Enforcement Framework

Comparative antitrust data demonstrates that multiple non-adjudication formats should only be permitted to co-exist when both are sequenced together or ring-fenced apart from each other.[27] This way, companies are not able to manipulate pedestal routes to decrease the penalties they incur. Sequencing is how the EU, UK and US run on their administrative functions; it is a safeguard against welfare loss because it allows you to maintain deterrent effects, allow confidentiality between companies and eliminate uncertainty around enforcement incentives.[28]

India must create an incremental, welfare-based system that maintains the deterrent effect of enforcement actions while enhancing organisational efficiency.

First, the existence of sequencing rules will help reduce "mechanism-shopping." Cartels must always use leniency as their sole avenue; there are no other options available that effectively disrupt cartel collusion. Therefore, only unilateral conduct is eligible for settlement, and the content of the settlement will be determined after limited disclosure, not based on the contents of the entire DG report, to promote expedited progress and enhanced confidentiality during the investigation.

Second, the current eligibility filter criteria must be upheld in order to ensure that deterrence is preserved. Hard-core cartel participants and habitual violators of competition laws cannot access settlement/commitment options.

Third, the confidentiality of settlement negotiations must be maintained. The decision made in the recent JCB case to allow parties involved in settlement negotiations access to the entire DG report has created a significant risk of discouraging future cooperation among the parties involved, resulting in the transformation of settlements into litigation, and providing convenient methods for gathering evidence. The possibility of the "chilling," even if inadvertent, can be very damaging to the cooperation model that continues to develop in the area of anti-cartel enforcement. 

Fourth and lastly, CCI's discretion should be exercised transparently and predictably. The reason that every judge expects the consistency of reasoning to be used by courts, as seen in Monsanto v. CCI, is to assist a firm in understanding possible outcomes, reduce uncertainty, and enhance compliance for all firms.[29]

International examples EU, Chile, and Brazil, have demonstrated that applying these four mechanisms in an uncoordinated and overlapping fashion has had negative effects on leniency applications and additional positive consequences.[30] To avoid these issues, India must begin clearly defining and separating the incentives and purposes of leniency, settlements, and commitments from the very beginning.

Conclusion 

In conclusion, India must establish a new framework for leniency, settlements, and commitments that promotes both efficiency and strong deterrence. The implementation of clearly defined sequences for utilising the various available mechanisms, strict eligibility requirements, confidentiality, and transparency in CCI decisions will allow cooperative instruments to enhance, not compete against, the enforcement of the competition law in India. Furthermore, India should consider past global experiences as well as lessons learned from the JCB case to develop a harmonious and welfare-focused model that maintains deterrence while providing faster and more reliable results.

Notes & References:

1. Anchal Kanthed and Ishita Nayak, ‘Reduced Litigations or Increased Ambiguity: In Light of the Settlement and Commitment Mechanism under the Competition (Amendment) Act, 2023’ (Manupatra, 2 July 2024) <https://articles.manupatra.com/article-details/REDUCED-LITIGATIONS-OR-INCREASED-AMBIGUITY-IN-LIGHT-OF-THE-SETTLEMENT-AND-COMMITMENT-MECHANISM-UNDER-THE-COMPETITION-AMENDMENT-ACT-2023> accessed 11 December 2025.

2. Vincent Abraham and Catarina Moura Pinto Marvão, ‘Leniency of the Competition Commission of India’ (SSRN Electronic Journal, 31 March 2022)< https://www.cci.gov.in/public/images/economicconference/en/paper-on-leniency-of-the-competition-commission-of-india1663219827.pdf> accessed 11 December 2025.

3. Roberto Alimonti, Sophie Kümmel and Thomas Nau, ‘The Interplay between Leniency Programmes and Private Enforcement: The Economist Perspective on Recent Policy Proposals’ (Concurrences Review, 2021) <https://awards.concurrences.com/IMG/pdf/2516-5771-article-p170.pdf?117164/b374c1a677c70d1662266beb6c8703b043e36bb1b3775a8f1e06cab874125856 >accessed 11 December 2025.

4. Supra note 1.

5. Competition Commission of India (Settlement) Regulations 2024, s 48A.

6. Competition Commission of India (Settlement) Regulations 2024, s 48B.

7. Joaquín Almunia, ‘Remedies, Commitments and Settlements in Antitrust’ (Speech, SV Kartellrecht, Brussels, 8 March 2013) <https://ec.europa.eu/commission/presscorner/detail/en/SPEECH_13_210>accessed 11 December 2025.

8. Shweta Rohit Rathod and Vishnupriya Dadhich, ‘Evaluating Consumer Welfare as the Cornerstone of Indian Competition Law: A Doctrinal and Policy Perspective’ (2023)<https://www.researchgate.net/publication/396711915_EVALUATING_CONSUMER_WELFARE_AS_THE_CORNERSTONE_OF_INDIAN_COMPETITION_LAW_A_DOCTRINAL_AND_POLICY_PERSPECTIVE> accessed 11 December 2025.

9. Competition Commission of India, Leniency Programme (Competition Advocacy Booklet, 2023) paras 1–7 <http://164.100.58.95/sites/default/files/advocacy_booklet_document/Leniency.pdf> accessed 11 December 2025.

10. Pfleiderer AG v Bundeskartellamt [1991] ECR I-4055.

11. Schneider Electric v Commission [1998] ECR I-3203.

12. Competition Commission of India, In Re: Cartelisation in Industrial and Automotive Bearings (Case No 03 of 2011, order dated 5 June 2014).

13. Supra note 12.

14. Supra note 7.

15. Competition Law Review Committee, Report of Competition Law Review Committee (Ministry of Corporate Affairs, Government of India, July 2019) <https://www.ies.gov.in/pdfs/Report-Competition-CLRC.pdf> accessed 11 December 2025.

16. Ibid.

17. Ibid.

18. Commission v Alrosa Company Ltd [2010] ECR I-5949 (GC).

19. Standing Committee on Finance, Fifty-Second Report: The Competition (Amendment) Bill, 2022 (Seventeenth Lok Sabha, Ministry of Corporate Affairs, 2022–23) <https://prsindia.org/files/bills_acts/bills_parliament/2022/SC%20Report_Competition%20%28A%29%20Bill,%202022.pdf>accessed 11 December 2025.

20. Competition Commission of India v JCB (India) Ltd (2020) 17 SCC 446.

21. Commitments & Settlements – A Welcome but Uncertain Introduction’ (AZB Partners, 29 April 2023) <https://www.azbpartners.com/bank/commitments-settlements-a-welcome-but-uncertain-introduction/>accessed 11 December 2025.

22. Supra note 18.

23. Supra note 17.

24. Joaquín Almunia, ‘Remedies, Commitments and Settlements in Antitrust’ (Speech, SV Kartellrecht, Brussels, 8 March 2013) <https://ec.europa.eu/commission/presscorner/detail/en/SPEECH_13_210>accessed 11 December 2025.

25. Competition Commission of India, 2002, s 3.

26. Competition Commission of India, 2002, s 4.

27. Competition Law Review Committee, Report of Competition Law Review Committee (Ministry of Corporate Affairs, Government of India, July 2019)< https://www.ies.gov.in/pdfs/Report-Competition-CLRC.pdf>accessed 11 December 2025.

28. Shweta Rohit Rathod and Vishnupriya Dadhich, ‘Evaluating Consumer Welfare as the Cornerstone of Indian Competition Law: A Doctrinal and Policy Perspective’ (2023)<https://www.researchgate.net/publication/396711915_EVALUATING_CONSUMER_WELFARE_AS_THE_CORNERSTONE_OF_INDIAN_COMPETITION_LAW_A_DOCTRINAL_AND_POLICY_PERSPECTIVE> accessed 11 December 2025.

29. Monsanto Holdings Pvt Ltd & Ors v Competition Commission of India & Ors (2020) 272 DLT 61.

30. Vijay Kumar Singh, ‘Consumer Protection Under Competition Law’ (SSRN Electronic Journal, 19 August 2024) <https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4930056>accessed 11 December 2025.

About the Author

K Meghana is Third Year Student at NALSAR University of Law, Hyderabad