The Competition Act 2002 (“Act”) prohibits abuse of dominant position but remains silent on the concept of collective dominance, a situation where two or more independent firms exert joint market power. Section 4 of the Act refers to abuse by “an enterprise or group,” but does not address market structures where firms, although individually non-dominant, may collectively influence outcomes through tacit coordination.[i] This gap has raised concerns, especially in concentrated markets like digital services, telecom or metals, where a few large players may act in parallel.[ii]
This issue resurfaced with urgency in the 2025 case, where the Competition Commission of India (“CCI”) dismissed the allegations of collective abuse in the refined copper market.[iii] The two firms, together controlling nearly 75% of the domestic supply, were accused of imposing onerous contractual terms, including de-pricing clauses and early invocation of bank guarantees, particularly during a period of tight supply following the COVID-19 lockdown. The CCI held that collective dominance is not recognized under Indian law, and neither Hindalco nor Vedanta was dominant on its own. It also found the firms’ conduct commercially justified in a commodity market prone to price volatility.[iv]
This decision coincided with a significant Supreme Court ruling in Schott Glass, where the Court affirmed that allegations under Section 4 require a demonstration of actual or likely anticompetitive effects, and that structural factors, such as market share alone, are insufficient.[v] The Court further clarified that business justifications, such as cost pass-through, risk allocation, or pricing based on global inputs, must be given due weight in assessing abuse.[vi]
Understanding Collective Dominance
“Collective dominance” refers to a scenario where a group of independent firms collectively holds sufficient market power to behave, in effect, like a single dominant firm.[vii] This concept was developed in European Union (“EU”) law under Article 102 TFEU, which prohibits abuse of “one or more undertakings of a dominant position”.[viii] Notably, early EU cases such as Almelo and Compagnie Maritime Belge emphasized that independent firms may be regarded as a single economic entity where they adopt a common market policy.[ix]
The economics of oligopoly underpin collective dominance. In markets with few players, firms can implicitly coordinate, achieving outcomes similar to those of explicit collusion.[x] Tacit coordination arises through transparency and mutual awareness: each firm’s pricing depends on anticipated reactions from others, without the need for formal agreement.[xi]
EU case law has developed tests for collective dominance focused on structural and behavioral factors:
- Under Airtours, the EU General Court required transparency, continuity, and accountability (including deterrent effects).[xii]
- In Piau, the Court reaffirmed that coordinated anticompetitive conduct need not be collusive; economic dependence sufficed.[xiii]
These criteria aim to identify instances where oligopolistic interdependence translates into market power that can harm competition.[xiv] The EU also uses the concept in merger assessments. Under the European Union Merger Regulation (“EUMR”), mergers are prohibited if they create or strengthen collective dominance, a structural approach that does not require proof of abusive conduct.[xv] This contrasts with Article 102 enforcement, where demonstrating actual abuse (not just dominance) is crucial.[xvi]
Scholars critique the vagueness of EU guidelines and evidentiary standards, warning that recognition often fails to translate into enforcement.[xvii] In India, scholars have long advocated for the introduction of a similar concept within the Competition Act.[xviii] However, critics counter that Section 3 (anti-competitive agreements) already offers sufficient coverage, including for tacit coordination, making explicit recognition unnecessary.[xix]
Collective Dominance Under Indian Law
Section 4(1) of the Competition Act, 2002 prohibits any “enterprise or group” from abusing a dominant position in the market.[xx] The term “group” is narrowly defined under Section 2(a) to include only associated or wholly-owned subsidiaries, excluding independent firms. As a result, two separate entities, even if they jointly control a market, cannot be treated as a “group” under the statute.[xxi]
The CCI has consistently declined to interpret Section 4 to encompass collective dominance. In Niraj Malhotra, the Commission dismissed allegations of uniform prepayment penalty charges by several banks collectively, holding that none was individually dominant.[xxii] Similarly, in Sanjeev Rao, the CCI dismissed claims against the Association’s members, despite their controlling 60% of the hire-purchase market, as the Act does not recognize collective dominance.[xxiii] In another case involving Ola and Uber, the CCI held that adversely affecting competitors through parallel conduct did not amount to abuse in the absence of individual dominance.[xxiv]
The Competition (Amendment) Bill, 2012, proposed to insert the words “jointly or individually” alongside “group” in Section 4(1), thereby enabling the CCI to regulate joint dominance.[xxv] However, it was never enacted. The 2020 Amendment Bill also omitted this change.[xxvi] The Competition Law Review Committee justified the omission by asserting that collective dominance is essentially a form of anti-competitive agreement under Section 3 and that invoking Section 4 was unnecessary.[xxvii] Nonetheless, judicial bodies such as the UK Competition Appeal Tribunal have recognized collective dominance, underscoring a divergence between Indian statutory silence and international best practices.[xxviii]
As a result of legal and enforcement constraints, the CCI cannot penalize firms exhibiting anti-competitive market power through tacit coordination unless they are individually dominant.[xxix] Enforcement agencies have largely focused on cartel investigations under Section 3 (e.g., recent ad agency raids), which require demonstrable agreements. This allows oligopolistic firms to engage in concerted market conduct without breaching Section 4, even when the outcome is equivalent to abuse.
CCI’s 2025 Ruling in Hindalco–Vedanta (Copper Market)
In a 2025 case involving the copper market, informants alleged coordinated abuse by Hindalco and Vedanta, who collectively hold around 75% of India’s refined copper market.[xxx] The claim focused on conduct during the COVID-19 lockdown, when buyers booked copper at London Metal Exchange (LME) Cash Settlement Prices, provided bank guarantees (“BGs”) or margins, and were later accused of being subjected to premature BG invocation, de-pricing clauses, and liquidation terms that allegedly favored Hindalco and Vedanta.[xxxi]
The CCI promptly clarified that “collective dominance” is not a recognized concept under the Competition Act 2002, and therefore parallel conduct by the two firms cannot be prosecuted under Section 4 unless one of them is individually dominant.[xxxii] Observing extensive communications, where Hindalco repeatedly offered pickup extensions and liquidation plans, the CCI held that de‑pricing and loss recovery were foreseeable terms in a commodity subject to international price volatility.[xxxiii] It found these conditions fair, given the substitution of cash BGs and price changes tied to LME. The Commission emphasized that BG invocation for performance failure is fundamentally a contractual remedy. That invocation, even if it resulted in insolvency, did not itself constitute an anticompetitive act warranting competition intervention under Section 4.[xxxiv] The matter was closed under Section 26(2) for no contravention of Section 4, and Section 33 relief was denied. The joint invocation of BGs did not qualify as cartel behaviour under Section 3, due to absence of proof of concerted planning or agreement.
Judicial Approach Post Schott Glass
In its landmark judgment, the Supreme Court delivered a clear mandate, i.e., Section 4 of the Competition Act 2002 does not outlaw dominance per se, but prohibits only its abuse, which must be established through evidence of Appreciable Adverse Effect on Competition (AAEC).[xxxv] The Court emphasized that legal analysis under Section 4 requires two steps to be answered; (i) Does the conduct fall within one of the sub-clauses (a)–(e)? and (ii) Does it produce or is it likely to produce a real and significant harm to competition? Any transformation of descriptive clauses into a per se prohibition was rejected as unduly punitive.[xxxvi] Therefore, an effects-based inquiry is mandatory under Section 4.[xxxvii]
The Court also affirmed that business justifications are relevant and must be weighed when evaluating contested practices. In Schott Glass, volume-based and functional discounts were held permissible because they were: (i) Uniformly available, based on volume, (ii) Supported by efficiencies, e.g., economies of scale, and (iii) had no foreclosure effect on rivals.[xxxviii] Moreover, the Court underscored the importance of procedural fairness, finding that the CCI’s reliance on untested witness statements, without allowing cross-examination, violated natural justice and fatally weakened the case.
Applied to Hindalco–Vedanta, the Schott decision has three major implications:
- Proof of AAEC is crucial – mere high market share or parallel conduct, as alleged in the copper case, is insufficient without showing actual harm.
- Contextual analysis dominates – volatile international prices and commercial negotiation history may justify unusual contract terms, as the CCI noted.
- Due-process standards matter – a failure to establish factual claims through rigorous evidence could invalidate allegations of abuse, including those involving joint conduct.
Other recent Tribunal and High Court decisions have reinforced this trend:
- Google LLC v CCI(NCLAT) affirmed that actual or likely anticompetitive effects must be shown even when conduct appears exclusionary.[xxxxix]
- Delhi High Court in Excel Crop Care Ltd v CCIemphasised that market position alone is not determinative, but needs to be supported by evidence of coordinated adverse outcomes.[xl]
Such decisions collectively signal the judiciary’s shift towards economic substance over form, particularly in oligopolistic markets. In light of this shift, the Hindalco–Vedanta findings reflect not doctrinal conservatism alone but a broader judicial preference for evidence-based, economic reasoning, even amid statutory limitations on collective dominance.
Conclusion: Recognising Collective Dominance
Indian law draws a clear line under Section 4 by defining dominance in terms of a single enterprise or group, the latter limited to related entities under common control. This interpretation excludes coordination among independent firms, a significant gap widely critiqued by scholars and practitioners. The Competition (Amendment) Bills of 2012 and 2020 attempted to remedy this lacuna by explicitly referencing joint dominance but did not succeed, resulting in legislative ambivalence and leaving the issue unaddressed.[xli]
Moreover, the Competition Law Review Committee (2012) dismissed the need for explicit provisions, contending that Section 3 already captures concerted conduct. However, it conceded that this approach falls short in tackling tacit coordination, which lacks explicit agreements and thus escapes Section 3’s ambit.[xlii]
Even where Section 3 might theoretically apply, practical enforcement is weak. The CCI relies heavily on recorded communications or formal agreements to establish collusion. Tacit coordination, conscious parallelism without an explicit agreement remains elusive in investigations, largely because there are no uniform standards or benchmarks to detect and penalise such behaviour.[xliii]
Furthermore, the CCI has repeatedly refrained from engaging with the concept in high-profile cases (e.g., Ola, Uber, Apple, Vodafone, Airtel, film screening associations), reinforcing a pattern of doctrinal avoidance.[xliv] This creates a regulatory vacuum where oligopolistic firms can exercise joint market influence without fearing legal sanction.
Following benefits can be derived by reforms in this area:
- Aligning with International Best Practices: Several jurisdictions have developed frameworks to recognise and address both structural and concerted collective dominance through merger control or competition law. The EU’s approach of prioritising structural factors and functional interdependence rather than explicit agreements offers a compelling legal model.[xlv]
- Reflecting Market Realities: India’s economy is increasingly shaped by oligopolies across sectors such as airlines, digital platforms, and food delivery. Here, market power is often exercised collectively rather than individually. Ignoring collective conduct allows firms to sidestep Section 4 scrutiny by operating just below individual dominance thresholds, even when their combined position clearly influences market outcomes.
- Enhancing Antitrust Enforcement: Explicit recognition of collective dominance would equip the CCI with clearer doctrinal, evidentiary, and analytical tools to tackle tacit coordination. It would also encourage more rigorous economic assessment of market interdependencies, thereby enhancing deterrence. Without such adjustments, enforcement risks remaining superficial and structurally blind.
References:
[i] Korah, An Introductory Guide to EC Competition Law and Practice (10th edn, Hart 2007) 98.
[ii] Whish and Bailey, Competition Law (10th edn, OUP 2021) 200–02
[iii] ‘CCI dismisses abuse of dominant position, duopoly claim against Hindalco, Vedanta’ (SCC Times, 18 June 2025) accessed 23 June 2025
[iv] ibid
[v] Competition Commission of India v Schott Glass India Pvt Ltd (Civil Appeal No. 1204 of 2024, decided on 13 May 2025) para 32.
[vi] ibid para 40.
[vii] Philip Bergkvist, Collective Dominance and EU Competition Law (2019) 1–2 .
[viii] Article 102 TFEU; see also Philip Bergkvist (n vii) 29..
[ix] Joined Cases 6/73 Almelo EU:C:1994:171, para 42; C 395/96 Compagnie Maritime Belge EU:C:2001:346, para 36.
[x] Bergkvist (n vii) 10–11.
[xi] Ibid.
[xii] T‑342/99 Airtours plc v Commission EU:T:2002:146, para 62.
[xiii] T‑228/97 Irish Sugar plc v Commission EU:T:1999:246, para 66.
[xiv] Marinova M, “Collective Dominance Under Scrutiny: Closing the Enforcement Gap or Complicating EU Competition Policy?”
[xv] Regulation 139/2004 (EUMR) art 2(3); Genecor Ltd v Commission (Case T‑165/94) EU:T:1998:344.
[xvi] Bergkvist (n vii) 22–25.
[xvii] ibid 1–2; Miroslava Marinova (n xiv).
[xviii] Prajwal Vishwanath, Soukya R D and Harshith N, ‘Collective Dominance: Need for Laws Relating to Collective Dominance and Difference Between Cartels’ (2019) 6(6) Journal of Emerging Technologies and Innovative Research 186 accessed 24 June 2025.
[xix] Charu Sharma and Rishabh Periwal, ‘Collective Dominance Through Tacit Coordination: Application of Game Theory to Indian Antitrust Law’ (IRCCL, 26 April 2022) accessed 24 June 2025.
[xx] Competition Act 2002, s 4(1); s 2(a).
[xxi] Ibid s 2(a).
[xxii] N Malhotra v Deutsche Post Bank Home Finance (Case No 5 of 2009)
[xxiii] Sanjeev Rao v AP Hire Purchase Association (Case No 49 of 2012)
[xxiv] Vatsla Shrivastava and Ritvik Maheshwari, ‘Exigency of Indian Competition Law: The Concept of Collective Dominance’ (NLUJ Law Review Blog, 29 May 2020) accessed 24 June 2025.
[xxv] Competition (Amendment) Bill 2012 (proposed s 4).
[xxvi] Competition (Amendment) Bill 2020.
[xxvii] Explanatory Note, Competition Law Review Committee Report (2012)
[xxviii] Brannigan v Office of Fair Trading [2005] CAT 24.
[xxix] Exigency of Indian Competition Law (n xxiv).
[xxx] ‘CCI dismisses abuse of dominant position, duopoly claim against Hindalco, Vedanta’ (SCC Times, 18 June 2025) accessed 23 June 2025
[xxxi] Ibid.
[xxxii] Dentons Link Legal, ‘Antitrust and Competition Newsletter: Airen Metals Private closes information against Hindalco & Vedanta’ (17 June 2025)
[xxxiii] ‘CCI dismisses abuse of dominant position, duopoly claim against Hindalco, Vedanta’ (SCC Times, 18 June 2025) accessed 23 June 2025.
[xxxiv] Ibid.
[xxxv] Competition Commission of India v Schott Glass India Pvt Ltd (Civil Appeal No 5843/2014, Supreme Court, 13 May 2025) para 40.
[xxxvi] Swasti Chaturvedi, ‘Section 4 Competition Act Doesn’t Per Se Prohibit Dominance; Effects-Based Analysis Is Obligatory Component Of Every Inquiry: Supreme Court’ (Verdictum, 14 May 2025) accessed 24 June 2025.
[xxxvii] Ibid; IndiaLaw LLP, ‘Balancing Competition Law: Supreme Court’s Verdict in Schott Glass Case’ (Mondaq, 20 May 2025) accessed 24 June 2025
[xxxviii] Ibid.
[xxxix] Google LLC v. Competition Commission of India Competition Appeal (AT) No. 1 of 2023 and Competition Appeal (AT) No. 4 of 2023.
[xl] Excel Crop Care Ltd. v. CCI, (2017) 8 SCC 47.
[xli] Competition (Amendment) Bill 2012; Competition (Amendment) Bill 2020.
[xlii] NLUO, Collective Dominance—A Concept Still Unknown to the Indian Competition Regime (5 Jul 2018).
[xliii] Collective Dominance Through Tacit Coordination (n xix).
[xliv] Exigency of Indian Competition Law (n xxiv).
[xlv] Ibid.
