• Notification Date: 18-02-2025
• Notification No: N/A

CCI Invites Stakeholder Comments on New Draft Rules for Cost of Production Calculation

Competition Commission of India (CCI) has announced draft rules on how production cost should be computed so as to toughen its system for declaring a company's conduct as predatory in pricing. The move streamlines current rules established in 2009 to the benchmark of economic thinking and international practice in the field of competition today.

The suggested new CCI (Determination of Cost of Production) Regulations, 2025, have also explained the term "predatory price" as selling goods or services at a price below cost with a view to harming competition or eliminating competitors from the market. In the revised guidelines, the price would usually have been computed on the basis of average variable costs, which would be taken as a proxy for marginal costs for the intent of establishing predatory pricing. In special situations, other measures of cost such as average total cost, average avoidable cost, or long-run average incremental cost can be used.

The suggested rules also permit the hiring of experts to determine costs and grant companies a right of an independent examination on their own expenses in case of disagreement with findings. Confidentiality of accompanying documents submitted will also be included in the 2025 General Regulations.

The stakeholders were also asked to provide their observations on the draft regulation by 19th March 2025, prior to replacing the expired 2009 norms with the new framework.