/Resources/Merger of DG Office with the CCI – An Integration Long Overdue

Merger of DG Office with the CCI – An Integration Long Overdue

Devansh Pandit


The Director General (hereinafter “DG”) of the Competition Commission of India (hereinafter “CCI”) is the driving force behind enforcement of the antitrust mechanism of India. The ambit of the DG’s power can be understood from the text of Section 16(1) of The Competition Act, 2002 (hereinafter “the Act”) which states that the DG shall assist the Commission in conducting inquiries into contraventions of any provisions of the Act. The DG’s investigative powers are further highlighted in Section 41 of the Act. Furthermore, after the Commission is of the prima facie view that an enterprise has entered into an anti-competitive agreement or abused its dominance, DG is directed to prepare a detailed report on the basis of which the CCI forms its final opinion. Thus, it can be seen that ever since the Act’s inception the DG was intended to be the investigative wing of India’s Competition law framework. However, the way in which provisions regarding the DG have been drafted raise substantial doubts with regards to the authority that exercises a controlling hand over its office. If we go through the text of Section 16(1), we find that the appointment powers with respect to appointing the DG vest with the Central Government; Strikingly, the very purpose of such appointment is to assist “the Commission in conducting inquiry into contravention of any of the provisions” of the Act. The Report of the Competition Law Review Committee (hereinafter “CLRC Report”) which was published in 2019 also took this issue into account and recommended a complete merger of the DG office with the CCI. This article will initially elaborate on the duality of control that is exercised over the DG office and the interpretative and practical issues that arise due to the same. Conclusively, it will suggest a way forward taking into account the practices followed globally, as well as those suggested in the CLRC Report.


Other than the general power of appointing the DG, a closer examination will reveal that the Central Government’s control over its office pervades to a greater degree than is apparent in the Act. For the purposes of further elaborating on the criteria of appointment and qualifications of the DG, the Central Government has promulgated the Competition Commission of India (Director General) Recruitment Rules, 2009 (hereinafter “Recruitment Rules”) and the Competition Commission of India (Number of Additional, Joint, Deputy or Assistant Director-General Other Officers and Employees, Their Manner of Appointment, Qualification, Salary, Allowances and Other Terms and Conditions of Service) Rules, 2003 (hereinafter “Qualification Rules”) under Section 16 of the Act. These rules accord significant power to the Central Government with regards to aspects of human resource, salary and management of the DG office. Besides this, the Government also plays an essential role in the Departmental Promotion Committee which is formed under the Qualification Rules for the purposes of appraisals within the DG Office, as three of its members are above the Secretary Level of the Central Government. Promotions and appraisals entail a continuous supervision over the DG’s functioning. It is also to be noted that CCI’s views/ recommendations play no role while the Central Government exercises powers under the above mentioned rules.

Due to the lack of the CCI’s involvement in a process as continuous as appraisals, management and the very appointment of the DG, it appears that the accountability of the DG Office ultimately rests with the Central Government. It can also be inferred that the Central Government has de jure control over the DG under the existing statutory framework.


The true essence of the DG’s office is embedded in the assistance it offers the Commission in conducting inquiries and investigations under the Act. After the formation of prima facie opinion that the matter may involve a violation of any provisions under the Act, the Commission directs the DG to further investigate into the matter as per Section 26. The Commission’s subsequent actions are entirely based on the findings of this report which the DG is obligated to submit as per Section 26 in the period prescribed by the Commission. The DG is statutorily mandated to make a recommendation in its report as to whether the provisions of the Act have been violated, or not which Commission may, or not accept. The subordination of the DG office to the CCI is also evident from the fact that under Section 26(7), Commission has the power to direct further inquiry into the matter even though the DG report recommends that there has been no violation by the Respondent party. Thus, the functions of the DG are entirely dependent upon directions of the Commission. The Supreme Court, too, has recognized in CCI v. Steel Authority of India Ltd. that though the DG is appointed by the Central Government, it is a specialized investigative wing of the Commission itself. In the same light, the Delhi High Court’s decision in Mahindra and Mahindra Ltd. v. CCI also emphasized primarily on the investigative role played by the DG under the CCI’s control.

Thus, it can reasonably be concluded that though statutory framework vests the accountability and appointment of the DG with the Central Government, it is under the CCI’s authority and directions that the DG is able to execute its functions as intended by the Competition Act. This apparent dilemma of as to whom is the DG answerable to necessitates a solution to further promote administrative and adjudicative efficiency of the antitrust enforcement regime of India.


The Sixth United Nations Conference to Review All Aspects of the Set of Multilaterally Agreed Equitable Principles and Rules for the Control of Restrictive Business Practices in its Chapter IX recognizes the three structural models which antitrust authorities of various countries follow. India’s competition enforcement mechanism closely resembles that of a bifurcated agency model wherein an authority which, in our case, is the DG – is responsible for heading the investigation and must bring the enforcement actions before specialized competition authorities (the CCI in India’s context). Concerns were raised by various stakeholders when submissions were invited for the CLRC Report of 2019 which highlighted the administrative inefficiencies and inordinate delays that arose out of the separation of the DG from the CCI.

In response to these submissions, the Committee recommended that India’s existing model should be replaced with an integrated agency model wherein the competition authority is empowered with both investigative and adjudicative functions, with rights of appeal to general or specialized appellate bodies. The Committee was also mindful of the aspect that the merger of the DG office with that of the CCI shall be accompanied with certain best practices which ensure that principles of natural justice are followed. Some of the standard practices involve granting functional autonomy to the DG and making him/ her answerable only to the Chairperson of the CCI along with a clear internal division of investigation and adjudicative functions.


Countries switching their competition enforcement model in furtherance of administrative efficiency is not a novel aspect. For instance, prior to 2011, Brazil’s antitrust regime was divided into 3 wings – the Administrative Council being the decision-making body in competition cases, The Secretariat of Economic Law acting as the investigative wing for antitrust cases and the Secretariat for Economic Monitoring which have non-binding opinions and performs advocacy functions. It is to be noted that all three wings were a part of different ministries and thus, not answerable to each other. In order to simplify and streamline its competition regime, Brazil passed Law No. 12,529 of November 30, 2011 which merged these three authorities into a new Administrative Council of Economic Defense – CADE and thereby moved to an integrated agency model. The CADE has been responsible for pushing Brazil’s antitrust regime above the global ladder to be placed on a similar platform as that of the US and EU.

It can be reasonably presumed that a similar merger in the Indian antitrust regime can prove to be beneficial for the country. However, an important factor that needs to be taken into account is with regards to the concerns of bias in investigative and adjudicative functions of the DG when the latter gets merged with the CCI - It will be essential for the legislature to accompany such integration with clearly laid out rules which ensure that due process is followed by the DG while executing its functions under the merged investigative wings. The recommendations of the CLRC Report, 2019 may also be taken into account in finalizing such rules for ensuring that principles of natural justice are followed.


The existing division of control over the DG office poses substantial questions with regards to which authority accounts for its proper functioning. The Central Government, besides having the power of appointment, is responsible for continuous supervision of the DG for appraisals and promotions. However, it is the CCI through which the DG is able to execute its legislative functions. Brazil’s integration measure may be taken as a milestone for the Indian legislature to further promote its competition law enforcement regime. Also, the recommendations of the CLRC Report ought to be taken into account to bring about the integrated agency model in India while ensuring that the integrated DG office does not turn a blind eye to principles of due process and natural justice.