Competition policy like consumer protection, amongst other issues, seeks to forestall other forms of market failure such as formation of cartels, leading to collusive pricing, division of markets and joint decisions to reduce supply. There is a strong commonality between competition policy and law on the one hand and consumer protection policy and law on the other. Competition policy is intended to promote efficiency and maximize consumer/social welfare. Consumer protection laws have slightly different objectives—health and safety of individual consumers, food standards and safety under Weights and Measures Act, 1 false advertisement, etc. Competition law can grow vertical or horizontal on consumer welfare with issues such as anti-dumping of cheap goods or parallel imports, etc. Further, the Competition law in India has extra territorial jurisdiction if the action has adverse effect on the Indian market.

Promotion of consumer welfare is the common objective of consumer protection and competition policy. Protection of consumers is accomplished by setting minimum quality specifications and safety standards for both goods and services and establishing mechanisms to redress their grievances. The recognition of an unequal relationship between consumers and producers is benevolent at the root of both consumer protection and competition policy. It thus becomes imperative to address a possible doubt as to whether the two legislations work in tandem or whether they lead to a tirade of policies and roles which, ultimately, leaves one prevailing over the other, as the new choice.

Consumerism: The Tentative Approach

The rights under the Consumer Protection Act, 1986 flow from the rights enshrined in Articles 14 to 19 of the Constitution of India. The Competition Act flows from the Article 39(b)(c) of the Directive Principles of State Policy2 which has far-reaching implications for consumer protection.3 The concern of consumer protection is to ensure fair trade practices, quality of goods and efficient services with information to the consumer with regard to quality, quantity, potency, composition and price for their choice of purchase. The Consumer Protection Act was enacted in 1986 based on the United Nations guidelines with the objective of providing better protection of consumers’ interests. The Act provides for effective safeguards to consumers against various types of exploitations and unfair dealings, relying on mainly compensatory rather than a punitive or preventive approach. The Act applies to all goods and services unless specifically exempted, and covers the private, public and cooperative sectors and provides for speedy and inexpensive adjudication.

Law Review Journal, Protection, Competition Law, Consumer Choice, Consumer protection, Weights and Measures Act, The Tentative Approach, (COPRA), Competition policy.