Competition watchdog needs to reveal identity of informants
Informants will also have to submit details of any pending disputes or litigation they may have against the party about which they provide information, according to notification. Experts said the move is likely aimed at curbing the filing of frivo...
“Where it is expedient to disclose the identity of the informant for the purposes of the Act, the Commission shall do so after giving an opportunity to the informant of being heard,” the Competition Commission of India said in a notification on Friday.
Informants will also have to submit details of any pending disputes or litigation they may have against the party about which they provide information, according to notification. Experts said the move is likely aimed at curbing the filing of frivolous cases and deterring forum shopping, where litigants approach multiple appellate fora to try and get a favourable verdict.
“The commission wants to discourage forum shopping,” said Anisha Chand, a partner at law firm Khaitan & Co., adding that the new regulation is in line with a Supreme Court ruling that stated the CCI should look only into matters pertaining to a sector after the sectoral regulator has provided its findings. Chand said the possibility of having their identities revealed may deter people from coming forward with information. “The CCI’s mandate is to ensure that market dynamics are not anti-competitive and they are ensuring fair play. So long as the information is credible and can be acted upon, the person who is giving the information should not be as material,” said Chand.
Requiring informants to provide information on pending disputes and litigation would allow for more efficient disposal of cases before the CCI, said Rahul Goel, a partner at law firm IndusLaw. “This may be able to ensure full and complete disclosure by the informant and will perhaps allow CCI to take a decision on whether they should proceed with the information immediately or seek information pertaining to disclosed pending cases (from authorities concerned, etc.),” said Goel.
Goel said parties subject to investigation may now argue before the CCI that the names of the informants should be revealed. “This possibly means that the order passed by the commission earlier granting confidentiality can be challenged,” he said.
The CCI has increased the fee for filing information with the commission. Companies with a turnover of up to Rs 2 crore in the previous year will have to pay Rs 40,000, while those with a turnover of Rs 2 crore to Rs 50 crore need to submit fees of Rs 1 lakh.