The Scope Of The Insolvency And Bankruptcy Code And Competition Law In Maintaining And Regulating Market Efficiency
- IJLLR Journal
- Apr 21
- 2 min read
Dr. Gunjan Ahuja, Assistant Professor, VSLLS, Vivekanand Institute of Professional Studies, Delhi
Anushka, Advocate, Bar Council of India; LLM student at VSLLS, Vivekanand Institute of Professional Studies, Delhi
ABSTRACT
The Insolvency and Bankruptcy Code (IBC), 2016, and the Competition Act, 2002, play a crucial role in maintaining as well as boosting market efficiency and economic stability in India. The Insolvency and Bankruptcy Code (IBC), 2016, provides a structured mechanism for resolving financially distressed companies, while the Competition Act ensures that restructuring or mergers do not lead to market concentration and anti-competitive practices. The primary issue this paper addresses is the overlap between insolvency resolution and competition regulation, particularly in cases where distressed firms are acquired by dominant players, potentially reducing market competition. The challenge lies in balancing corporate recovery and fair competition while ensuring swift resolution under the IBC and preventing monopolistic behavior under the Competition Act.
Technological advancements have significantly enhanced the enforcement of both laws. In insolvency resolution, the use of Artificial Intelligence and Blockchain has improved data analysis, automated decision-making, and ensured secure, transparent transactions. Artificial intelligence, empowered by predictive analytics helps identify potential insolvency risks and streamline resolution timelines. The Competition Commission of India (CCI) has also adopted big data analytics and AI-driven tools to detect cartelization and abuse of dominance more efficiently, particularly in digital markets.
This study examines the regulatory overlap, challenges, and technological innovations shaping the interaction between insolvency and competition law. It evaluates case studies where insolvency resolution has impacted market concentration, highlighting the need for better coordination between insolvency regulators and competition authorities. By analyzing legislative frameworks, policy developments, and recent technological integrations, this research aims to provide recommendations for improving regulatory oversight, ensuring fair competition, and promoting a sustainable economic environment.
