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Vol. 19 Issue 1 (2023)

Antitrust Concerns vis-a-vis Disruptive Innovation – Takeaways for Competition Commission of India

Dr. Sudhanshu Kumar & Garima Gupta

In the era of innovation, market dynamics have evolved demanding a more nuanced analysis of market competition. Innovation in digital economy does promise new products and services but it can be an amiable reality only if it is directed towards ensuring consumer welfare and a free markets space for players. Since digital markets attract innovators and disruptors, it is important for antitrust regulators to differentiate between efforts directed towards value-creation and ones aimed at destroying or impeding the same. This paper aims at theorizing around the idea of ‘disruptive innovation’ and its implications for competition policy for India. The paper while acknowledging the pro-competitive benefits of disruptive innovation, elaborates on the fact that incumbents or potential players may in some situations clothe a business strategy as ‘disruptive’ in order to evade anti-trust scrutiny. Further, practices such as rent-seeking or killer acquisitions may be adopted in order to create barriers for new players or for driving out existing players which have a strong potential of disrupting the market by offering new products or services and thereby creating a new demand, altogether. Considering the fact that an antirust regulator in such situations needs to avoid false positives and false negatives while also ensuring continued innovation, the paper deliberates upon the need to evolve fundamental strategies for antitrust assessment. Reliance has been placed upon the developments in other jurisdictions such as the European Union and United States in order to identify certain key takeaways for the Competition Commission of India (‘CCI’). While CCI in the recent past has made tremendous efforts in evolving its assessment to better suit digital markets, certain fundamental understandings around which an assessment revolves also demand evolution. In this light, the paper intends to provide some level of guidance to assess complex situations demanding antitrust assessment in a manner that should not lead to chilling effects on innovation.


Dr Sudhanshu Kumar is an associate professor at the National Law School of India University, Bangalore.
Garima Gupta is a Doctoral Fellow at NALSAR University of Law, Hyderabad.

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