I. Introduction

The gears of the market shift in high levels of confidence and so do its disputes. Alternate dispute resolution mechanisms were brought into practice to counter the arduous and daunting nature of Court litigation processes. However, despite the ease of procedure, arbitration as a choice of dispute resolution mechanism has struggled to find its place in matters related to Competition and Antitrust in the Indian regime. This paper deals with two separate fields of law – Arbitration and Competition, governed by two separate statutes respectively. Arbitration proceedings in India are regulated and governed by the Arbitration and Conciliation Act, and it deals with both domestic and international matters pertinent to arbitration. Matters related to Competition, on the other hand, are overseen by the Competition Commission of India (CCI) under the Competition Act, 2002. With the help of judicial precedents (both domestic and foreign) and analysis of the implications of the Competition (Amendment Act) 2023 (hereinafter: the Amendment Act) this paper attempts to assess the viability of arbitration as a method of resolving competition matters. On a bare reading of both the statutes, it can be inferred that their areas of operation are not the most convergent. Arbitration and Competition law could be considered the opposite ends of a coin, as arbitration is a more private method that deals with two parties in an agreement, and does not concern itself with matters having an element of public interest, whereas Competition Law is applicable in cases where there is a question of general public and overall market regulation.

II. India’s Longstanding Anti-Arbitration Stance w.r.t Competition Matters

Before delving into the longstanding or the contemporary (post-2023 Amendment) Indian stance, it is imperative to understand what the term ‘arbitrability’ stands for.

First, with regard to legislative restrictions, the Arbitration & Conciliation Act’s Section 2(3) declares that the Act would be compliant with laws that forbid the arbitration of specific kinds of disputes. Furthermore, provisions 34(2)(b) and 48(2) allow an award to be set aside and denied enforcement in cases where the subject matter is too complex for arbitration to handle. Perhaps best explained by the Supreme Court in the judgement of Booz-Allen & Hamilton Inc. v. SBI Home Finance Ltd & Ors (Booz-Allen judgement) where the Court held that conflicts and disputes concerning a person's "right in personam" i.e., their rights against particular people, as in a contract, are recognised as arbitrable, while those involving a "right in rem," or a person's right against the entire universe, are frequently viewed as non-arbitrable. Three requirements must be met, held the Supreme Court while dismissing the appeal, in order for an issue to be under arbitration's purview. These were:

i) The disputes had to be capable of being arbitrated and settled;

ii) The disputes had to be covered by the arbitration agreement; and

iii) The parties had to have submitted the disputes for arbitration.

The type of rights at issue determines whether a dispute is arbitrable. This case has been frequently used to prove the invalidity of arbitration in competition matters. Following the Booz-Allen judgement, Courts have had varying opinions in different cases on the basis of their individual merits and facts. For example, in the matters of Kingfisher Airlines Limited v. Prithvi Malhotra Instructor, and HDFC Bank v. Satpal Singh, Court’s ratio was pro-arbitration in nature, whereby it was opined that arbitration is not completely and automatically prohibited merely by the establishment of a special tribunal. Arbitration can only be refused in cases when a particular law confers unique rights and responsibilities on the tribunal, as well as unique authorities not granted to the courts. In the latter judgement, this principle was followed and arbitration was permitted over a debt recovery matter. But this practice of passing pro-arbitration judgements was nowhere near consistent and often left aggrieved parties without a framework to rely upon for resolution of their disputes. For example, in the subsequent judgement of Natraj Studios Pvt. Ltd. v. Navrang Studios the court refused to allow arbitration of a rent control dispute, stating that even though it deals with right in personam, the Rent Control Act gives the arbitral tribunal special rights and powers to handle disputes of this nature, so the tribunal will not have the necessary jurisdiction to hear the case. The apparent and evident inconsistency in precedents laid an even more puzzling framework when it came to sensitive matters like Antitrust. It wasn’t till the judgement of Union of India vs Competition Commission of Indiahttps://www.casemine.com/judgement/uk/5a8ff7b960d03e7f57eb181fet that the Courts clarified whether or not Competition matters are arbitrable. This was a case in which a collection of parties that had signed into an agreement with the railways sued the Ministry of Railways, claiming that they were abusing their position of control and establishing strategic hurdles. They submitted this application under the Arbitration and Conciliation Act with a valid clause. However, the Delhi High Court permitted the Competition Commission to handle the current case. According to the court, the arbitral Tribunal lacks the necessary knowledge and resources to resolve the dispute.

III. Foreign Jurisdictions on Antitrust Arbitration: A Comparative Analysis

This section would briefly deal with the use of arbitration as a dispute resolution mechanism for Europe (under European Commission Competition Law) (EC Competition Law) and the United States of America (Federal Trade Commission Act 1914) (FTCA 1914).

In Europe there exists a prominent junction between EC competition law and international arbitration. Although governmental authorities are the major means of enforcing EC competition legislation, the EU legal order relies on private action to do so. Arbitration is used to resolve a large portion of private litigation. The evolution of EC competition legislation (which went into effect on May 1, 2004) demonstrates the EU's desire for private adjudication to play a larger part in this enforcement process in the future. As a result, arbitration tribunals face more EC competition law concerns, emphasising the importance of how they address these issues. In ET Plus SA & Ors v. Jean-Paul Welter & Ors (aka the Paris arbitration) the English High Court treated the arbitrability of EC Competition law as just and valid, and opined: “There is no realistic doubt that such ‘competition’ or antitrust claims are arbitrable.” (emphasis supplied)

The stance of the USA on arbitrability of antitrust matters can be best understood by the judgement of Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc. a Japanese-based automobile manufacturer entered into a contract with a Puerto Rico-based distributor for the distribution of automobiles in and around San Juan, Puerto Rico. The contract provided for arbitration in Japan. When a dispute broke out, Soler evidentially resisted arbitration. Mitsibushi brought suit before a Federal District Court seeking to compel arbitration in accordance with the arbitration clause, Soler opposed this on the basis that its defences under US antitrust law were not arbitrable. Blackmun J. for the majority held that the US antitrust claims raised were indeed covered by the arbitration clause at issue, and that matters of US antitrust are indeed arbitrable.

IV. Implications of the Amendment Act of 2023: Conclusion & Way Forward

The Amendment Act brings forth several noteworthy modifications to the current competition regulatory framework. Each of the revisions aims to provide a framework for the effective and transparent enforcement of competition that will benefit both consumers and companies. These include the addition of the concept of "material influence" to the definition of "control," a three-year statute of limitations for entertaining information or references about purported Act violations, and a shorter timeline for implementing combinations (from 210 to 150 days). But perhaps the most relevant out of them all is the novel concept of a Settlement and Commitment Mechanism for enterprises under inquiry for abuse of dominance or anti-competitive agreements. This framework encourages collaboration and speeds up conflict resolution by giving businesses the chance to pursue settlement through mutually agreed-upon remedies or obligations. Regulations will specify the precise process for settlements and obligations, bringing Indian competition law into compliance with global best practices. By minimising the time and money needed for drawn-out investigations and court cases, this new system seeks to promote effective and law-abiding corporate operations. This part of the Amendment Act can be seen as something that will pave the way for arbitration in competition law matters, keeping in view the successful implementation of the same in foreign jurisdictions. This is a further indicator of the fact that the Indian competition regime does not necessarily need to criminalise antitrust offences (like the USA) in order to optimally check and balance its markets. The goal of this mechanism is to drastically cut administrative expenses while enabling prompt action that benefits customers and the economy as a whole.