Competitively sensitive information (CSI) refers to any non-public information relating to a company’s market strategies, operations, or commercial performance that could be used by competitors to align their market behaviour in a favourable and strategic manner to foreclose the market. This information, thus, has the potential to undermine competition in the market and impact consumer welfare adversely. Such information could include future pricing, pricing strategies, costs, production capacities, customer lists, outputs etc., and is deemed to be information that a rational competitor would not share with other players in the market.

It is important to note that the CCI has often interchangeably used ‘commercially sensitive information’ and ‘competitively sensitive information’, with little clarity on whether there is a distinction between the terms.

The exchange of CSI between competitors is one of the primary elements in the establishment and functioning of cartels. Even outside a cartel, the unilateral or hub-and-spoke exchange of such information can be seen as evidence of tacit collusion between the parties. 

In Re: Alleged anti-competitive conduct in the Beer Market in India, the CCI found the parties guilty of having entered into anti-competitive agreements for sharing sensitive information related to their intended prices, capacity and future market strategy. This was established through explicit communication, including email correspondence. This exchange was held to constitute “meeting of minds.” Thus, the parties were held liable for a violation of Section 3. 

Another aspect of competition law where CSI is significant is gun-jumping, which is the violation of standstill obligations during a combination assessment. Essentially, parties that have notified a combination to the CCI for approval are required to wait for the CCI to approve the transaction before taking any steps in furtherance of it. The exchange of CSI is seen as such a step, and attracts the contravention of Section 6(2A) of the Act. The rationale is that any coordination or sharing of information between parties to a potential combination before the CCI approves it would prematurely eliminate the competition between them, harming overall competition. In relation to the limits of information permitted to be exchanged between such combining parties, the ‘clean team’ mechanism becomes relevant.