Monopolistic and

Restrictive Trade Practice

Act,1969

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Why MRTP Act Enacted ?

 To ensure that the operation of the

economic system does not result in the
concentration of economic power in hands of
few,
 To provide for the control of monopolies, and
 To prohibit monopolistic and restrictive trade
practices.

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Scope

 The MRTP Act extends to the whole

of India except Jammu and Kashmir.

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Monopolistic Trade
Practices (MTPs)

Abuse of market power by:

 Charging Unreasonably high prices

 Preventing or reducing competition
 Limiting Technical Development
 Deteriorating product quality
 Increasingly unreasonably profits….

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 REGULATION OF MTPs
As per Section 31 of the MRTP Act: Central Govt.:-

Refer matter to MRTP Commission Pass

order for:-

 a) Regulation of production & fixing the terms of sale

(including prices)
 b) Prohibiting any action that restricts competition
 c) Fixing Standards for goods produced…

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RESTRICTIVE TRADE PRACTICE
(RTPs)

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RESTRICTIVE TRADE
PRACTICES (RTPs)
A trade practice which:
 Prevents, distorts or restricts competition
 Obstructs the flow of capital or resources into the
stream of production; or
 Which tends to bring about manipulation of prices
or conditions of delivery or effected the flow of
supplies in the market of any goods

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In short, RTPs include:-
Discriminatory dealings
Control of manufacturing process
Boycott
Price control arrangements
Tie-in sales or full-line forcing
Restriction on output or supply of goods…

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 INQUIRY INTO RTPs

 The Commission may inquire into any

restrictive trade practice
 Upon receiving a complaint from any
trade association, consumer or a
registered consumer association, or
 Upon a reference made to it by the
Central or State Government

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RELIEF AVAILABLE
The commission shall if after making an
inquiry it is of the opinion that the practice is
prejudicial to the pubic interest, or to the
interest of any consumer it may direct that …

The practice shall be discontinued or shall

not be repeated;
CONTD.

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The agreement relating thereto shall be
void or shall stand modified.

The Commission may permit the party

to any RTP to take steps so that it is no
longer prejudicial to the public interest

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 MTPs Vs RTPs

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SIMILARITIES AND
DIFFERENCES
Both MTPs and RTPs prejudicial to
public interest
Both need enquiry
Temporary injunction to be issued
Compensation can be awarded…..

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UNFAIR TRADE PRACTICE
(UTPs)

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 WHAT IS UNFAIR TRADE
PRACTICE (UTPs) ?

Any trade practice which is

considered unfair and harmful to the
consumer is an unfair trade practice.

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 These are:-

1. False representation
2. False offer of bargain price
3. Free gifts offer and prize schemes
4. Non-compliance of prescribed standards
5. Hoarding or destroying of goods.
6. Supplying of unsafe or hazardous
products….

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RELIEF AVAILABLE

After making an inquiry into the UTP

commission can direct that –
Any information, or advertisement
relating to such UTP shall be disclosed
The practice shall be discontinued or
shall not be repeated;
The agreement relating thereto shall
be void
CONTD.

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The Commission is empowered to
direct publication of corrective
advertisement and disclosure of
additional information while passing
orders relating to unfair trade
practices….

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ENFORCEMENT MACHINERY

Consists of following authority:

Monopolistic and Restrictive Trade
Practices Commission (MRTPC)
Director-General of Investigation and
Registration
Central Government
Supreme Court….

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