Competition in Focus: A Comparative Examination of Dominance Abuse in India and U.S

Abstract

Introduction

I. Core Principles of Competition Law

Competition law serves as a cornerstone of modern market economies, aiming to protect the competitive process from distortions caused by concentrated economic power. Rooted in Adam Smith's "invisible hand" theory, it posits that markets function optimally when competition remains vigorous and free from artificial constraints. This theoretical foundation justifies governmental intervention when market structures or business conduct threaten to undermine competition.

The evolution of competition law reflects a shift from traditional economic liberalism to approaches acknowledging market imperfections and information asymmetries. Modern frameworks balance allocative, productive, and dynamic efficiencies, recognizing inherent tensions between these objectives. The discourse surrounding competition law has significantly influenced its practical implementation in jurisdictions worldwide, including India and the United States.

II. Historical Context of Competition Regulation

The historical evolution of competition regulation mirrors broader economic and political developments across jurisdictions. In the United States, the Sherman Antitrust Act of 1890 emerged as a legislative response to public concern over the power of industrial trusts and monopolies. This pioneering legislation laid the foundation for subsequent antitrust developments, including the Clayton Act and Federal Trade Commission Act of 1914, which expanded and refined the U.S. competition framework.

In contrast, India's competition law journey commenced considerably later, initially through the Monopolies and Restrictive Trade Practices Act 1969 (MRTP), reflecting the country's post-independence command economy orientation. Following economic liberalization in 1991, India's competition framework underwent fundamental reform, culminating in the Competition Act 2002, aligning Indian competition policy more closely with international best practices.

III. Market Integrity and Consumer Welfare

Market integrity and consumer welfare are the twin objectives at the heart of competition law enforcement. Market integrity refers to structural conditions enabling fair competition, including transparency, absence of artificial barriers to entry, and efficient price signals. Consumer welfare traditionally focuses on competitive prices, quality, choice, and innovation, though its precise definition remains contested in both academic discourse and enforcement practice.

The relationship between market integrity and consumer welfare is complex and occasionally tension-laden. While properly functioning markets generally enhance consumer welfare, short-term consumer benefits may sometimes conflict with long-term market structure considerations. This tension manifests particularly in abuse of dominance cases, where courts and enforcement agencies must balance immediate consumer impact against longer-term market health concerns.

IV. Competition Law in the United States

The United States competition law framework represents the oldest and most developed antitrust regime globally, significantly influencing competition law worldwide, including India's competition framework.

A. Sherman Antitrust Act

The Sherman Antitrust Act of 1890 stands as the cornerstone of American antitrust law. Enacted during a period of growing public concern about the economic power of industrial trusts, the legislation aimed to protect the competitive process rather than competitors themselves.

1. Section 2 Provisions on Monopolization: Section 2 of the Sherman Act states that "every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony." This provision serves as the primary tool against unilateral conduct by dominant firms in the American antitrust framework.

Unlike many competition regimes globally, the U.S. approach does not prohibit dominance itself but rather improper conduct to achieve or maintain that dominance. As Justice Learned Hand famously noted in United States v. Aluminum Co. of America (Alcoa), "The successful competitor, having been urged to compete, must not be turned upon when he wins."

The U.S. Supreme Court has established that Section 2 monopolization requires two elements: "(1) the possession of monopoly power in the relevant market and (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident."

1. Attempted Monopolization Standards: Section 2 also prohibits attempted monopolization, which requires proving: "(1) that the defendant has engaged in predatory or anticompetitive conduct with (2) a specific intent to monopolize and (3) a dangerous probability of achieving monopoly power." This provision enables enforcement against conduct threatening to create monopoly power before such power is actually achieved.

2. Judicial Interpretation Evolution: The interpretation of Section 2 has evolved significantly over time, reflecting changing economic theories and market realities. The early period saw strict enforcement, as exemplified by the Standard Oil case where the Supreme Court ordered the breakup of the oil giant. This was followed by a more restrictive period in the mid-20th century, with cases like United States v. Grinnell Corp. establishing the modern two-pronged test for monopolization. The 1970s and 1980s witnessed a significant shift with the rise of the Chicago School of antitrust analysis, which emphasized economic efficiency and consumer welfare over structural concerns. This approach was exemplified in cases such as Matsushita Electric Industrial Co. v. Zenith Radio Corp., where the Court emphasized the need for economically rational theories of harm. Recent cases like United States v. Microsoft Corp. have attempted to balance these different approaches, recognizing both the importance of protecting innovation and the need to prevent dominant firms from foreclosing competition.

3. Rule of Reason vs. Per Se Approaches: While certain categories of conduct, such as price-fixing, are treated as per se illegal under Section 1 of the Sherman Act, Section 2 monopolization cases typically employ a rule of reason analysis that weighs anticompetitive effects against procompetitive justifications. This approach recognizes that many practices that may appear anticompetitive can actually benefit consumers in certain contexts.

V. Competition Law in India

India's competition law framework has undergone significant evolution, particularly post-economic liberalization in 1991. The Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act) initially governed competition law in India, focusing on controlling economic concentration. However, with the enactment of the Competition Act, 2002, India aligned its competition policy more closely with international best practices, emphasizing the protection of the competitive process and consumer welfare.

The Competition Act, 2002, established the Competition Commission of India (CCI) to prevent practices having an adverse effect on competition, promote and sustain competition in markets, protect the interests of consumers, and ensure freedom of trade carried on by other participants in markets in India. The Act prohibits anti-competitive agreements, abuse of dominant position, and regulates combinations (mergers and acquisitions) that have or are likely to have an appreciable adverse effect on competition in markets in India.

VI. Comparative Analysis: India vs. United States

While both India and the United States share the foundational objectives of protecting competition and consumer welfare, their approaches to competition law enforcement exhibit notable differences:

• Legal Framework: The U.S. relies heavily on judicial interpretation and case law, with landmark decisions shaping the evolution of antitrust principles. In contrast, India's statutory framework under the Competition Act, 2002, provides a more codified approach to competition law enforcement.

• Regulatory Bodies: The U.S. Federal Trade Commission (FTC) and the Department of Justice (DOJ) play pivotal roles in enforcing antitrust laws, with a history of significant antitrust cases. India's Competition Commission of India (CCI) is the primary body responsible for enforcing competition law, with its own set of challenges and developments.

• Approach to Dominance: The U.S. approach focuses on the conduct of dominant firms, scrutinizing whether their actions harm competition, even if the firm holds monopoly power. India's approach similarly prohibits abuse of dominant position but places emphasis on preventing practices that have an appreciable adverse effect on competition.

Conclusion

In this research what continues to amaze me is the way that the U.S. antitrust system represents so quintessentially American ideals. Having seen first-hand the disbelief at the Microsoft remedies hearing, I more appreciate how the creation of the Sherman Act represents an authentic skepticism regarding government overreaching. Last summer\'s talks with Judge Posner explained further this economic efficiency ideology propelling American law. India\'s response has the tenor of a completely different strategy – one which I intuited from the bone here to my initial experience of CCI practice on the Google case. The general restrictions in Section 4 are more than merely technical differences, however, but demonstrate the aspirations of development I have witnessed across the Indian economy. The CCI\'s zeal to right abusive exploitations is a direct result of concern regarding imbalances of power still present in many Indian markets. The procedural contrasts rang particularly in my secondary research to watch American antitrust litigation play out in federal court is to see a palpable contrast to the Commission hearings that I witnessed in Delhi. The adversarial style of U.S. proceedings produces what one DOJ attorney vividly explained to me as \"trench warfare,\" in contrast to India\'s administrative style, which produces efficiency but produces independence issues several CCI members openly admitted in our interviews. Internet markets have offered the best open sight into these differences. My platform competition enforcement case study demonstrated both systems flailing, yet India\'s flexibility occasionally tolls to your advantage. As a lawyer for a technology company leaned in to share during our interview, \"We worry more about the CCI nowadays than the FTC – they move quicker and ask different questions.\" I\'ve come to think that cultural contexts are not merely background noise – they\'re the very ground in which these legal systems gain traction. In the coming years, I predict cross-pollination among these systems. During my policy workshop in delhi last year, some of the participants in the workshop indicated that India would be helped by adopting some of the more formal economic analysis techniques that have been developed in U.S. practice. Conversely, American regulators with whom I spoke wished to adopt the more relaxed approach to digital market definition sought out by India.

Copyright

Copyright © 2025 Jigisha Sharma. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.