A small issue in the recent Order of the Commission in Saurabh Bhargava v. Ministry of Agriculture (Main Order/Dissenting) was whether the Commission had the authority to issue a notice to the Ministry of Agriculture or even reprimand it for any laws which it may enact which may be considered ‘anti-competitive’ in the relevant market economy. The main order does not bother to stress on the issue (presumably because the case as it is stands dismissed on merits). However, it is respectfully submitted that the CCI would not have any statutory authority for the following reasons.:

1. The definition of enterprise has been defined under Section 2(h) as follows:

“enterprise” means a person or a department of the Government, who or which is, or has been, engaged in any activity, relating to the production, storage, supply, distribution, acquisition or control of articles or goods, or the provision of services, of any kind, or in investment, or in the business
of acquiring, holding, underwriting or dealing with shares, debentures or other securities of any other body corporate, either directly or through one or more of its units or divisions or subsidiaries, whether such unit or division or subsidiary is located at the same place where the enterprise is
located or at a different place or at different places, but does not include any activity of the Government relatable to the sovereign functions of the Government including all activities carried on by the departments of the Central Government dealing with atomic energy, currency, defence and space.

Now firstly, regulations or rules issued by any executive authority for the purposes of regulation of the provision of any goods or service cannot be it self be considered a service on the part of the Government.  It is merely the exercise of the legitimate state authority. Secondly, using the phrase “..relating to the….” to justify such sanction of such executive authority is I feel too broad an interpretation of the definition of the term “enterprise”.

2. Section 3 is irrelevant in such cases as the Government does not enter into an agreement of any form in stipulating certain regulatory criteria which requires fulfillment by an individual to commence his or her operations.

3. An argument against the government under Section 4 would also fail in light of the definition of the term “Dominant Position” under the explanation to Section 4.:

(a) “dominant position” means a position of strength, enjoyed by an enterprise, in the relevant market, in India, which enables it to—
(i) operate independently of competitive forces prevailing in the relevant market; or
(ii) affect its competitors or consumers or the relevant market in its favour.

The dual requirements of this definition cannot be fulfilled since any such ministry or other governmental department is not part of any relevant market or catering to any consumers with any goods or services.

4. A notification under Section 54 would also not be necessary in such a circumstance for the reasons mentioned above.

However, I should clarify that I certainly do not intend to say that a PSU cannot be held accountable under the Act. The above argument would apply strictly to an executive authority of the government such as a ministry or a sub-division of a ministry.