## Report on the Competition Commission of India Determination of Cost of Production Regulations, 2025
**1. Executive Summary:**
This report analyzes the Competition Commission of India (CCI) Determination of Cost of Production Regulations, 2025, as published in the Gazette of India. This new policy establishes a framework for determining the cost of production in the context of the Competition Act, 2002. It defines various cost concepts, including average variable cost, total cost, and long-run average incremental cost (LRAIC), and outlines the process for determining cost in competition-related investigations. The key finding is that the policy provides clarity and structure around cost determination, which is crucial for assessing anti-competitive practices like predatory pricing. It also repeals and replaces the 2009 regulations.
**2. Introduction:**
This report aims to provide an informative overview of the Competition Commission of India Determination of Cost of Production Regulations, 2025, based solely on the text provided in the Gazette of India publication. The report will analyze the policy's objectives, key provisions, implementation aspects, and expected outcomes.
**3. Policy Overview:**
* **Core Objective(s):** The core objective of this policy, as inferred from the text, is to establish a clear and defined framework for determining the cost of production for the purpose of enforcing the Competition Act, 2002. This framework appears designed to provide a basis for the CCI to evaluate potential anti-competitive conduct related to pricing.
**4. Background and Rationale:**
* **New Policy:** This new policy likely addresses a need for a standardized and updated approach to determining the cost of production in competition-related cases. The existing regulations from 2009 were likely outdated, necessitating a revision to reflect current industry practices and economic principles. The policy aims to provide greater clarity and consistency in cost determination, thus strengthening the CCI's ability to effectively enforce competition law.
**5. Key Provisions / Changes:**
Since this is a new policy, this section details the main components, rules, and actions mandated by the entire provided text.
* **Short Title and Commencement:** The regulations are titled "The Competition Commission of India Determination of Cost of Production Regulations, 2025" and come into force on the date of their publication in the Official Gazette.
* **Definitions:** The policy defines key terms relevant to cost determination, including:
* "Act" refers to the Competition Act, 2002.
* "Average variable cost" is defined as total variable cost divided by total output.
* Various cost concepts such as "total cost," "total variable cost," "total avoidable cost," "average avoidable cost," "long run average incremental cost (LRAIC)," and "average total cost" are defined. The definition of "cost" includes details of items to be considered for calculating different costs.
* "Commission" refers to the Competition Commission of India.
* "Product" refers to goods or services as defined in the Act.
* "Marginal cost" is defined as the change in total cost arising from a one-unit change in quantity produced.
* **Determination of Cost:** The policy states that cost, in the context of section 4 of the Act, is generally taken as average variable cost as a proxy for marginal cost. However, it also allows the Commission to consider other relevant cost concepts, such as average total cost, average avoidable cost, or LRAIC, based on the specifics of the industry, market, and technology, with written justification.
* **Engagement of Experts:** The Commission or the Director General may seek assistance from experts in determining costs. Parties can request the Commission to appoint experts to assist in cost determination at their own expense.
* **Request for Confidentiality:** Requests for confidentiality of submitted documents will be considered according to the Competition Commission of India General Regulations, 2024.
* **Removal of Difficulty:** The Commission will determine the procedure for cost determination in situations not covered by the Act, rules, or these regulations.
* **Repeal and Savings:** The Competition Commission of India Determination of Cost of Production Regulations, 2009, are repealed. However, actions taken under the repealed regulations remain valid.
**6. Target Audience and Stakeholders:**
Based on the text, the target audience and stakeholders include:
* The Competition Commission of India (CCI) and its Director General.
* Enterprises operating in India, particularly those involved in competition-related investigations.
* Legal professionals and consultants advising businesses on competition law matters.
* Experts in cost accounting and economics who may be engaged by the CCI or parties involved in proceedings.
**7. Implementation Aspects (Inferred):**
* **Responsible Agency/Bodies:** The Competition Commission of India (CCI) is the primary responsible body for implementing these regulations. The Director General may also play a role, particularly in investigations.
* **Timelines or Procedures:** The regulations come into force on the date of their publication in the Official Gazette. The policy outlines procedures for determining cost, engaging experts, and handling confidentiality requests, but doesn't specify precise timelines.
* The Commission will determine the procedure for cost determination in situations not covered by the Act, rules, or these regulations.
**8. Expected Outcomes / Impact of Changes:**
* The likely intended outcomes based on the policy's provisions are:
* Increased clarity and consistency in cost determination for competition law enforcement.
* Improved ability of the CCI to assess anti-competitive conduct, such as predatory pricing, more effectively.
* Greater transparency and predictability for businesses regarding the cost concepts used by the CCI.
* Modernization of the cost determination framework to reflect current economic and industry conditions.
**9. Conclusion:**
The Competition Commission of India Determination of Cost of Production Regulations, 2025, represent a significant update to the framework for cost determination in competition law enforcement. By providing clear definitions, specifying the general use of average variable cost, and outlining procedures for engaging experts and handling confidentiality, the policy aims to enhance the CCI's ability to effectively address anti-competitive practices. The policy is significant as it impacts how the CCI analyses potentially anti-competitive behavior, which can substantially affect businesses operating in the Indian market. It's crucial for stakeholders to understand the new regulations to ensure compliance and effectively participate in competition proceedings.
Key Entities Referenced
INDIA: Country in which the Gazette is published
NEW DELHI: City of publication
MAY 6, 2025: Date of publication of the Gazette
VAISAKHA 16, 1947: Date of publication according to the Indian national calendar
THE GAZETTE OF INDIA: Title of the official government publication
Competition Commission of India: Regulatory body issuing the notification
Competition Commission of India Determination of Cost of Production Regulations, 2025: Title of the regulations being notified
Competition Act, 2002: The primary legislation that empowers the Competition Commission of India, cited by year and act number (12 of 2003)
Official Gazette: The official publication in which the regulations are published
Act: Refers to the Competition Act, 2002 (12 of 2003) within the context of the regulations.
Regulation 3: A specific regulation within the 'Competition Commission of India Determination of Cost of Production Regulations, 2025' regarding the determination of cost
Companies Act, 2013: Indian legislation related to companies, cited by year and act number (18 of 2013)
Director General: An authority who may seek the help of experts in arriving at cost figures
Competition Commission of India General Regulations, 2024: Regulations governing confidentiality of submitted documents
Competition Commission of India Determination of Cost of Production Regulations, 2009: The regulations that are being repealed by the new regulations
INDER PAL SINGH BINDRA: Secretary who signed the notification
Government of India Press, Ring Road, Mayapuri, New Delhi110064: Location of the printing office
Controller of Publications, Delhi110054: Publisher of the Gazette
रजजस्ट्री ु.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99
सी.जी.-डी.एल.-अ.-07052025-262951
xxxGIDHxxx
CG-DL-E-07052025-262951
xxxGIDExxx
अुाधारण
EXTRAORDINARY
भाग III—खण् ड 4
PART III—Section 4
प्राजधकार ु ेप्रकाजित
PUBLISHED BY AUTHORITY
ु.ं 350] नई ददल्ली, मगं लाार, मई 6, 2025/ािै ाख 16, 1947
No. 350] NEW DELHI, TUESDAY, MAY 6, 2025/VAISAKHA 16, 1947
भारतीय प्रजतस्ट्प धा ा ययगग
अजधुचू ना
नई ददल् ली, 6 मई, 2025
भारतीय प्रजतस्ट्प धा ा ययगग उउ्प ादन लागत का अाधारणव जाजनयम, 2025
उ2025 की ु.ं 02)
फा. ु.ं ुीुीयई/जानी-ुीओपी/01/2025-26 .—भारतीय प्रजतस्ट् पधाा ययगग, प्रजतस्ट् पधाा अजधजनयम, 2002 उ2003 का
12व की धारा 64 की उपधारा उ2व के खंड उकव द्वारा उुे प्रद् त िजतियय का प्रयगग करते ुए, एतद्द्वारा, जनम् नजलजखत जाजनयम बनाता
ू,ै अथाा त:् –
1. ुजं िप्त नाम रर प्रारंभ. –
(1) इन जाजनयम का ुंजिप्त नाम भारतीय प्रजतस्ट् पधाा ययगग उउ् पादन लागत का अाधारणव जाजनयम, 2025 ू।ै
(2) ये जाजनयम राजपत्र में इनके प्रकािन की तारीख कग प्राृ् त ू गे।
2. पररभाीाएं.–
(1) इन जाजनयम म,ें जब तक दक ुंदभा ुे अ् यथा अपेजित न ूग –
(क) “अजधजनयम” ुे प्रजतस्ट् पधाा अजधजनयम, 2002 (2003 का 12व अजभप्रेत ूै;
(ख) “रुत परराती लागत” ुे जनर्ददष्ट अाजध के दररान कलल यउटपलट ुे जाभाजजत कलल परराती लागत अजभप्रेत ूै;
2998 GI/2025 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC.4]
(ग) जाजनयम 3 में यथाप्रयलक् त ‘’लागत’’ रर उुके व् यल् प् न ुे जनम् नजलजखत ुंदभा जलया जा ुकेगा:
i. ‘’कलल लागत’’ ुे उ् पादन की ाास्ट् तजाक लागत अजभप्रेत ूै जजुके अंतगा त उपभगग की गई ुाम्ी की लागत,
प्र् यि मजदरू ी रर ाेतन, प्र् यि व् यय, अाियण, ुंकमा उपररिीीा , गलणा् ता जनयंत्रण लागत, अनलुंधान
रर जाकाु लागत, पैकेजजग लागत, जनर्ददष् ट अाजध के दररान उ् पाद ूते ल प्रिाुजनक उपररिीीा जैुी मद ेंभी
ुजम्मजलत ू;ैं
ii. ‘‘कलल परराती लागत’’ ुे खंड उiव में जनर्ददष् ट सुी कलल लागत अजभप्रेत ू ै जजुमें जनयत लागत रर जनर्ददष् ट
अाजध के दररान उ् पाद ूते ल जनयत उपररिीीों, यदद कगई ूग, के अंि कग घटा ददया गया ूै;
iii. ‘’कलल पररूाया लागत’’ ुे सुी लागत अजभप्रेत ू ै जजुमें जनयत लागत रर जनर्ददष् ट अाजध के दररान
उ् पाद ूते ल जनयत उपररिीीों, यदद कगई ूग, के अंि कग घटा ददया गया ू;ै
iv. ‘’रुत पररूाया लागत’’ ुे सुी कलल लागत अजभप्रेत ूै जजुे ‘कलल पररूाया लागत’ के यकलन के जलए
जनर्ददष् ट अाजध के दररान जाचार में ली गई कलल यउटपलट ुे जाभाजजत दकया गया ूै;
v. ‘‘दीघा काजलक रुत परराृजि लागत’’ (एलयरएयईुीव ुे सुी ुभी परराती रर जनयत लागत जजुके
अंतगा त डूबी ुई लागतें भी ुजम्मजलत ूैं, का रुत अजभप्रेत ू ै जग प्र् यि या अप्र् यि ूपप ुे जाजनर्ददष् ट
उ् पाद रर ुेाा के उ् पादन ूते ल माने जा ुकते ूैं जजुके अंतगा त अ् ाेीणाधीन अाजध ुे पूाा या दररान
उपगत कगई उ् पाद-जाजनर्ददष् ट जनयत लागतें भी ू।ैं सुी दिा में, जूां बु-उ्पाद उद्यम ूैं, एलयरएयईुी
में उु ुीमा तक, ुामा्य लागत का यनलपाजतक अंि भी ुजम्मजलत ूगता ूै, जजु तक सुी लागत ें
प्रश् नगत उ्पाद या ुेाा के उ्पादन द्वारा या परराृजि के ूपप ुे ूगती ूै;
vi. ‘’रुत कलल लागत’’ ुे सुी कलल लागत अजभप्रेत ू ै जजुे जनर्ददष् ट अाजध के दररान कलल यउटपलट ुे
जाभाजजत दकया गया ूै;
(घ) ‘‘ययगग’’ ुे अजधजनयम की धारा 7 की उपधारा उ1व के अधीन स्ट्थ ाजपत भारतीय प्रजतस्ट् पधाा ययगग अजभप्रेत ूै;
(ङ) ‘‘उ् पाद’’ ुे अजधजनयम में यथापररभाजीत, यथाजस्ट्थजत, माल या ुेााएं अजभप्रेत ूै;
(च) ‘‘ुीमांत लागत’’ कलल लागत में सुा परराता न ू ै जग उु ुमय उदभूत ूगता ू ै जब उ् पाददत मात्रा में एक
यलजनट का परराता न ूगता ू।ै
(2) इन जाजनयम में प्रयलक् त सुे ि्द रर पद का, जग पररभाजीत नूीं ूैं क्रमि: ाूी अथा ूगगा, जग उनका,
यथाजस्ट्थजत, अजधजनयम या कंपनी अजधजनयम, 2013 (2013 का 18व में ू।ै
3. लागत का अाधारण. –
अजधजनयम की धारा 4 के स्ट्प ष् टीकरण में ‘’लागत’’ कग ुाधारणत: ुीमांत लागत के जलए परगिी के ूपप में रुत परराती लागत के
ूपप में ुंगजणत दकया जाएगा:
परंतल यू दक जाजनर्ददष् ट मामल में लेखबि दकए जाने ााले कारण ुे ययगग, उद्यगग, बाजार रर प्रयलक् त प्ररद्यगजगकी की
प्रकृजत पर जनभा र करते ुए दकुी अ् य ुलुंगत लागत अाधारणा कग जाचार में ले ुकेगा जैुे दक रुत कलल लागत, रुत पररूाया
लागत, दीघा काजलक रुत परराृजि लागत।
4. जािेीज्ञ का जनयगजन. –
(1) लागत के यंकड पर पुचं ने के जलए यथाजस्ट्थजत, ययगग या मूाजनदिे क यथगजचत जािेीज्ञ की ुूायता ले ुकेगा।
(2) जूां कायाा ााजूय का पिकार, जाजनयम 3 के अधीन ययगग द्वारा अाधाररत लागत के ुंबंध में कगई जाााद उठाता ूै, ाूां
ाू जलजखत में प्रस्ट् तलत दकए जाने ााले कारण ुे ययगग कग लागत का अाधारण करने में ुूायता करने के जलए
जािेीज्ञउजािेीज्ञ व की जनयलजतिय करने का अनलरगध कर ुकेगा।[भाग III—खण् ड 4] भारत का राजपत्र : अुाधारण 3
(3) कायाा ााजूय के पिकार द्वारा दकए गए अनलरगध पर जाचार करने के पश् चात् ययगग, यदद ाू सुा जाजनश् चय करता ू ैतग ाू
उुे लागत के अाधारण करने में ुमथा बनाने के जलए अनलरगध करने ााले पिकार की लागत पर अपनी पुंद के
जािेीज्ञउजािेीज्ञ व की जनयलजतिय कर ुकेगा।
5. गगपनीय व्य ाूार के जलए अनरल गध. –
यथाजस्ट्थजत, ययगग या मूाजनदिे क कग दस्ट् तााेज की गगपनीयता के जलए प्रस्ट् तलत दकुी अनलरगध पर भारतीय प्रजतस्ट् पधाा ययगग
उुाधारणव जाजनयम, 2024 के अजधकजथत प्रदक्रया के अनलुार ुम् यक् ूपप ुे जाचार दकया जाएगा।
6. करठनाई का जनाारण. –
सुी पररजस्ट्थजत म,ें जजुके जलए अजधजनयम, जनयम या इन जाजनयम में उपबंध या जनाा चन नूीं दकया गया ूै, लागत के
अाधारण की प्रदक्रया ययगग द्वारा अाधाररत की जाएगी।
7. जनरुन रर व् यााजृ ाया.ं –
(1) भारतीय प्रजतस्ट्पधाा ययगग उउ् पादन लागत का अाधारणव जाजनयम, 2009, उु तारीख ुे जनरस्ट्त ूग जाएंगे जजु
तारीख कग ये जाजनयम प्राृ् त ू गे।
(2) सुे जनरुन में दकुी बात के ूगते ुए भी, –
(क) सुे जनरुन ुे पूाा , जनरजुत दकए गए जाजनयम के अधीन, दकया गया कलछ भी या की गई या दकया जाना या की
गई ता् पर्यियत कगई कारा ााई, या कगई काया ााूी या जनणा य, यरंभ की गई जांच या यरंभ दकया गया अ् ाेीण, इन
जाजनयम के त् स्ट् थानी उपबंध के अधीन दकया गया या जलया गया ुमझा जाएगा;
(ख) जनरजुत जाजनयम का प्राता न या तदधीन ुम् यक ूपप ुे दकया गया या भलक् त कलछ भी, तदधीन अर्यिजत, प्रगद्भूत या
उपगत कगई अजधकार, जािेीाजधकार, बाध्य ता या दाजय्ा, या तदधीन घरटत कगई अ् ाेीण, जाजधक काया ााूी
या उपचार अप्रभाजात रूेंगे मानग जनरजुत जाजनयम कभी जनरजुत ूी न दकए गए ू ;
(ग) भारतीय प्रजतस्ट्पधाा ययगग उउ् पादन लागत का अाधारणव, 2009 के जनरुन के पश् चात्, ययगग द्वारा जारी
उनके कगई प्रजतजनदिे जजुके अंतगा त कगई जाजनयम, जनदिे या जाजनश् चय भी ूैं, इन जाजनयम के त् स्ट् थानी
उपबंध का प्रजतजनदेि ूगना ुमझा जाएगा।
इंदर पाल जुू जब् रा, ुजचा
[जाज्ञापन-III/4/अुा./82/2025-26]
THE COMPETITION COMMISSION OF INDIA
NOTIFICATION
New Delhi, the 6th May, 2025
The Competition Commission of India (Determination of Cost of Production) Regulations, 2025
(No. 02 of 2025)
F.No. CCI/ Reg-COP/01/ 2025-26.—In exercise of powers conferred by clause (a) of sub-section (2) of
section 64 of the Competition Act, 2002 (12 of 2003), the Competition Commission of India hereby makes the
following regulations, namely: -
1. Short Title And Commencement. –
(1) These regulations may be called the Competition Commission of India (Determination of Cost of Production)
Regulations, 2025.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. DEFINITIONS.–
(1) In these regulations, unless the context otherwise requires –
(a) ―Act‖ means the Competition Act, 2002 (12 of 2003);
(b) ―average variable cost‖ means total variable cost divided by total output during the referred period;
(c) ―Cost‖ as used in Regulation 3 and its derivation may have reference to:
i. ―total cost‖ means the actual cost of production including items, such as cost of material consumed,4 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC.4]
direct wages and salaries, direct expenses, depreciation, work overheads, quality control cost, research
and development cost, packaging cost, administration overheads attributable to the product during the
referred period;
ii. ―total variable cost‖ means the total cost referred to in clause (i) minus the fixed cost and share of
fixed overheads attributable to the product, if any, during the referred period;
iii. ―total avoidable cost‖ means the cost that could have been avoided if the enterprise had not
produced the quantity of extra output during the referred period;
iv. ―average avoidable cost‖ is the total avoidable cost divided by the total output during the referred
period, considered for estimating ‗total avoidable cost‘;
v. ―long run average incremental cost‖ (LRAIC) means average of all variable and fixed costs
including any sunk costs, that are directly or indirectly attributable to the production of a specific
product or service, including any product-specific fixed costs incurred before or during the period
under investigation. In the case of multi-product enterprises, LRAIC also includes a proportionate
share of common costs, to the extent that such costs are caused by or incrementally attributable to
the production of the product or service in question;
vi. ―average total cost‖ is total cost divided by total output during the referred period ;
(d) ―Commission‖ means the Competition Commission of India established under sub-section (1) of
section 7 of the Act;
(e) ―product‖ means the goods or services, as the case may be, as defined in the Act;
(f) ―marginal cost‖ is the change in total cost that arises when the quantity produced changes by one unit.
(2) Words and expressions used but not defined in these regulations shall have the same meaning
respectively assigned to them in the Act or the Companies Act, 2013 (18 of 2013), as the case may be.
3. DETERMINATION OF COST. –
―Cost‖ in the Explanation to section 4 of the Act shall, generally, be taken as average variable cost, as a proxy
for marginal cost:
Provided that in specific cases, for reasons to be recorded in writing, the Commission may, depending on the
nature of the industry, market and technology used, consider any other relevant cost concept such as average total
cost, average avoidable cost, or long run average incremental cost.
4. ENGAGEMENT OF EXPERTS. –
(1) In arriving at the figures of costs, the Commission or the Director General, as the case may be, may take
the help of suitable experts.
(2) Where a party to the proceedings disputes the cost determined by the Commission under regulation 3, it
may, for reasons to be submitted in writing, request the Commission to appoint expert (s) for assisting in
determining the cost.
(3) On consideration of the request made by a party to the proceedings, the Commission may, where it so
decides, appoint expert(s) of its choice, at the cost of the party making the request, to enable it to
determine the cost.
5. REQUEST FOR CONFIDENTIALITY. –
Any request for confidentiality of the documents submitted to the Commission or the Director General, as the case
may be, shall be duly considered in accordance with the procedure laid down in the Competition Commission of
India (General) Regulations, 2024.
6. REMOVAL OF DIFFICULTY. –
In a situation not provided for in the Act, rules or these regulations or in the matter of their interpretation, the
procedure for determining the cost shall be determined by the Commission.
7. REPEAL AND SAVINGS. –
(1) The Competition Commission of India (Determination of Cost of Production) Regulations, 2009, stand
repealed from the date on which these regulations come into force.
(2) Notwithstanding such repeal, –
(a) anything done or any action taken or purported to have been done or taken, or any proceedings or
decision, inquiry or investigation commenced under the repealed regulations, prior to such repeal,
shall be deemed to have been done or taken under the corresponding provisions of these regulations;[भाग III—खण् ड 4] भारत का राजपत्र : अुाधारण 5
(b) the operation of the repealed regulations or anything duly done or suffered thereunder, any right,
privilege, obligation or liability acquired, accrued or incurred thereunder, or any investigation, legal
proceeding or remedy ensued thereunder, shall remain unaffected as if the repealed regulations have
never been repealed;
(c) after the repeal of the Competition Commission of India (Determination of Cost of Production)
Regulations, 2009, any reference thereto including in any regulations, direction or decision issued by
the Commission, shall be deemed to be a reference to the corresponding provisions of these
regulations.
INDER PAL SINGH BINDRA, Secy.
[ADVT.-III/4/Exty./82/2025-26]
Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.