Introduction

Part I of this two-part series explored the origins and evolution of the doctrine in the European Union, analysed the international reception of this concept and concluded with India’s engagement with the doctrine. 

By assessing conventional antitrust tools and their effectiveness in concentrated markets through case studies in Part II, this piece shall serve as a call for reconsideration of India’s aversion to the doctrine. 

Concentrated Markets & Antitrust

Conventional antitrust regimes regulate the coordination between business entities termed as ‘cartelization’, which causes foreclosure of competition. Generally, they are wary of regulating independent business decisions as it may impact the ease of doing business of enterprises and interfere with their freedom of trade. Thus, only enterprises enjoying a ‘dominant’ position, assessed through various factors including, inter-alia: having a substantial market presence or share, having the ability to influence prices, etc. are policed for their independent decision making, contingent upon any resultant adverse effects on market competition. 

The question which increasingly confounds antitrust regulators is the extent of this ‘dominance’, especially as rapidly concentrating markets give rise to arrangements such as oligopolies and duopolies where there are multiple entities enjoying near-equal influence over the market. Known as the ‘oligopoly problem,’ such independent business conduct undertaken in parallel by oligopolists without any concert still leads to competitive harm which cannot be addressed using conventional abuse of dominance provisions. Moreover, with the proliferation of technology and rapid advancements in innovation, many sectors have come to incubate Schumpeterian markets within them, highlighted by a competition ‘for’ instead of  ‘in’ the market. (See Chapter 3 of the CDCL Report, 2022)

A good example is the set of antitrust litigations filed by Meru against Ola and Uber. The entry of Ola and Uber, backed by deep-pocketed venture capital and algorithmic facilitation, transformed the app-taxi market. Both firms ran prolonged, including deep discounts and large driver incentives, purely to capture market share. Under conventional abuse-of-dominance rules, this is difficult to police since section 4 in India requires proof of single-firm dominance. The short-run consumer boon of cheap rides obscures the long-run harm: in tight duopolies, sustained cash-burn eliminates weaker rivals and deters entry, after which prices tend to rise as firms chase profitability. Losers in such wars often exit or restructure, rarely as solvents, while winners inherit a durable duopoly. 

Another recurring blind spot arises with regards to parallel exclusive-dealing and refusals-to-deal. When two or three gatekeepers independently adopt similar exclusivity clauses or decline access to a critical input or platform, the cumulative effect can foreclose rivals as effectively as a cartel. Yet, absent an agreement or single-firm dominance, traditional tools look away. Should regulators remain silent when “independent decisions” amount to a de facto collective boycott?

Something similar was alleged by a Film production and distribution company in Ashok Kumar Vallabhaneni v. Geetha SP Entertainment LLP, where it averred that the defendants – who collectively controlled 80% of the screens in the States of Andhra Pradesh and Telangana, had engaged in abuse of dominance. In another instance, Jio had alleged in an antitrust suit that its competitors had blocked its entry by abusing their dominant position during its entry into the telecommunications market in India. In-fact, Jio itself was also the subject of an antitrust investigation for engaging in predatory pricing practices – during its entry into the market when it allegedly engaged in predatory pricing with the sole intention of rapidly gaining market capitalization at the detriment of other competitors. Quintessentially an example of recoupment, the free services have long since been discontinued, with customers left with heavy bills to pay for. While the CCI refused to intervene, citing that the market was competitive enough with a presence of a lot of players & given the non-dominant position of Jio, the impact of such practices has been transformative – as the mobile telecommunications sector today is a concentrated oligopoly, consisting of a handful of competing firms.  Very recently, the CCI also considered the case involving collective dominance of Hindalco and Vedanta. However, common in all these is prima facie (without investigation into merits) dismissal due to the statutory inability to prosecute under Section 4(1).  Competition regulators usually refrain from restraining price-wars as in the case of Jio, (or other non-concerted anti-competitive practices adopted by non-dominant entities) as it is perceived to increase competition in the short-run. However, the elimination of competitors must be seen in the long-run as a monopolization tactic which will eventually lead to recoupment strategies, causing harm to competition in the long-run. The “competition, and not competitors” doctrine, must therefore be revisited. 

The concept of collective dominance must not be viewed as an attempt at reducing the evidentiary threshold for prosecuting cartels, but as a holistic tool to address harm to competition, especially in concentrated markets. The CLRC report proclaims that multilateral conduct harming competition is ‘sufficiently’ covered by Section 3 of the Competition Act, which punishes anti-competitive practices. However, this conclusion fails to adequately capture what the doctrine stands for (as pointed out by the General Court in Flat Glass & Airtours).  Modern oligopolies and duopolies have led to adoption of common strategies by competitors termed as ‘conscious parallelism’, even without any element of tacit or explicit concert. Such strategies often lead to detriment of competition in the long-run, which could be prevented through effective enforcement of the collective dominance doctrine. 

Conclusion

Global experience shows the tension between promoting competition and avoiding enforcement overreach. India’s journey toward becoming the world’s third largest economy demands that its competition law framework be robust, future-facing, and capable of addressing the complex realities of modern market structures. Allowing a statutory vacuum which enables increasing concentrations in markets as competition regulators are rendered toothless, where conscious parallelism escapes scrutiny, invites not only harm to consumers but also entrenches barriers against dynamic competition and innovation. Enforcement challenges should not dissuade regulators from recognizing doctrinal possibilities where market realities demand them. Moreover, suggestions such as adding thresholds to Section 4 can guard against enforcement overreach. Rather than viewing collective dominance as a doctrinal mirage, Indian competition law must critically, doctrinally, and practically evaluate its incorporation – crafting a calibrated provision that empowers the CCI while preserving safeguards against overreach.  At the least, the concept must be revisited owing to the ever-concentrating markets in the wake of technological facilitation and algorithmic catalysation. Without such evolution, India risks leaving its competition regime toothless precisely when vibrant and fair markets are most needed for national economic aspirations.

About the Author

The author is a Ist year B.A., LL.B. (Hons.) Student at NALSAR University of Law, Hyderabad. He may be contacted at ssjoshi@nalsar.ac.in