Hub and spoke cartels or H&S arrangements consist of a
common intermediary indirectly enabling the co-ordination of
competitors. The hub is central to allowing the co-ordination of
competing entities or spokes. Such sophisticated arrangements have
developed over the years, leading to close scrutiny by antitrust
regulators across the globe.
Until recently, H&S arrangements were not explicitly
recognised under the Competition Act, 2002 (act). However, the
Competition (Amendment) Act, 2023 (2023 amendment) has now brought
them within the act. A proviso has been added to section 3(3) of
the act, which provides that an enterprise or association of
enterprises, though not engaged in identical trade, shall also be
presumed to be part of the horizontal anti-competitive agreement if
it participates or intends to participate in the furtherance of
such agreement. H&S arrangements may fall foul of section 3(3)
if the following conditions are met.
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