When does the exercise of patent rights become an antitrust violation? The apex court is now poised to answer a question that remains at the intersection of “innovation in a healthy competitive market” and “market regulation.” Recently, in Competition Commission of India v. Swapan Dey & Another,[1] the Supreme Court (SC) has stepped into a core jurisdictional conflict to determine whether the Competition Commission of India (CCI), the chief national antitrust regulator in India, can investigate anti-competitive actions arising from the application of patent rights. The SC has recently stayed some contentious portions of a National Company Law Appellate Tribunal (NCLAT) order,[2] which shielded patent disputes from CCI scrutiny and reopened one of the consequential debates in Indian antitrust law jurisprudence.
The issue arises from the trend that has impacted the scope of CCI regulations in matters of patent and its application. The NCLAT had held that disputes arising out of the exercise of patent rights fall squarely within the domains of the Patents Act 1970,[3] placing its reliance on the Delhi High Court (HC) decision in the Monsanto Holdings Private Limited & Ors vs Competition Commission Of India & Ors, where the court refused to entertain CCI's jurisdiction on any matter pertaining to exercise of patent rights. Such decisions have been prevalent in Indian antitrust jurisprudence and highlight how the Indian judiciary perceives the Patents Act as a standalone legislation that can address questions of licensing, royalty, and patent rights, and its extent, among other concerns, independently. This position seems to be open for re-examination as the SC agrees to re-examine the current status and the fine line between IP rights and CCI.
Hence, the core question before the court is whether patent rights, though lawful and important for risks associated with innovation, can be exercised in a manner that escapes CCI oversight even in situations where they distort competition. Against this backdrop of recent SC order in CCI v. Swapan Dey, this article attempts to examine this tension and understand where the law ought to draw the line between legitimate exclusivity and unlawful exclusion.
CCI v Swapan Dey: An Overview
The SC, on 2 February 2026 stayed parts of an NCLAT ruling that held the Competition Act inapplicable to allegations of abuse of dominance arising from exercise of patent rights. The court, in reference to the NCLAT order dated 30.10.2025 in Swapan Dey v. Competition Commission of India,[4] reserved its judgement pertaining to the question of jurisdictional ambit of CCI, vis-à-vis the Patents Act, 1970, refusing to reopen the merits of the case. The NCLAT judgement relied heavily on the 2023 division bench decision of the Delhi HC in the Erickson-Monsanto case. Both these decisions ousted the jurisdiction of the CCI based on the lex specialis principal holding that the Patents Act is a special law equipped to handle issues of abuse of patent rights and unreasonable licensing conditions without the need for the Competition Act to come into the picture. In the Swapan Dey case, the dispute arose from a complaint against a Swiss pharma company Vifor International concerning its patented drug on alleged abuse of dominance. Despite the CCI already having closed the case on its merits, the NCLAT went a step further to oust the jurisdiction of the CCI in itself.
This core question is not merely a procedural debate of applicability between two statutes. At its core lies a more important question, where does legitimate exclusivity end and anticompetitive exclusion begin?
The Fine Line Between Exclusivity And Exclusion
Think of it with an example where you have created a vaccine, taking commercial & non-commercial risks. If it proves to be successful, you as the innovator who would want to commercially exploit the same by holding its exclusive rights and access. To put this example into theoretical perspective, exclusivity is one of the core incentives rewarding innovation and the risks and costs associated with research and development. However, when such exclusivity translates into exclusionary conduct, it risks creating market foreclosure and undermining consumer welfare by fostering monopolistic or oligopolistic market conditions, which is anti-competitive.
The CCI, drawing its powers from the Competition Act 2002 and being the chief regulator in the realm of competition, has authority to intervene when IP exclusivity goes beyond legitimate protection and harms market dynamics. The CCI's role is therefore not just to prevent anti-competitive conduct but also to operate as a balancing authority to determine when the tips of exclusivity crosses over to exclusion. This balance is perfectly encapsulated within Section 3(5)(i)(b) of the Competition Act,[5] which validates patent rights provided such rights impose reasonable conditions.
However, interventions by the fairly nascent CCI raises questions about its jurisdiction and the extent of the same. IP laws, particularly the Patents Act, 1970, endow exclusive rights to make, use, and commercially exploit patented products. The breadth of these rights often fuel the perception and invite the argument that such products can and do have immunity against antitrust scrutiny. This ultimately raises a critical regulatory question: who is the determining authority of when the exercise of patent rights crosses its lawful boundaries?
One way of resolving this dilemma can be to use the Appreciable Adverse Effect on Competition (AAEC) test as prescribed by Section 19(3) of the Competition Act.[6] Thus, AAEC, while not negating the IP rights insofar as their legitimacy and scope to encourage innovations are concerned, is a behavioural check of how those rights are exercised in a relevant and healthy competitive market. A product is said to remain perfectly in line with permissible exclusivity as far as IP law is concerned, as long as Section 19(3) is not triggered. However, when an action creates consequences such as barrier to entry, market foreclosure, or consumer harm, or fails to fall under the scope of demonstrable efficiency, the action in question ceases to be merely IP rights, and morphs into an anti-competitive character, which is not welcome in any healthy competitive market. At this precise moment, CCI's jurisdiction is not extraordinary or an intrusion into another special legislation consequently leading to a jurisdictional conflict, rather it is a parallel safeguard essential for market integrity and consumer welfare.
As per Section 62 of the Competition Act,[7] the CCI's role, its jurisdiction, and functions operate in addition to, and not in derogation of other statutes. Drawing from the same, the Competition Act is designed to co-exist with other legal frameworks such as IP laws, and the CCI, therefore, is neither subordinate, nor adversarial towards it. Therefore, the real boundary is not the existence of exclusive rights per se, but the anti-competitive consequences that flow from their exercise. As long as exclusivity remains intrinsically connected to protecting the statutory subject matter of the intellectual property right, the domain of patent law remains undisturbed. The moment exclusivity is strategically leveraged to eliminate competition rather than protect innovation, competition law assumes jurisdictional primacy.
Consider a pharmaceutical company holding a patent over a life-saving drug. While the patent legitimately grants exclusive manufacturing and distribution rights, the conduct may shift from exclusivity to exclusion if the patent holder refuses to license the drug to generic manufacturers despite surplus capacity and imposes restrictive agreements preventing distributors from dealing with substitutes. At that stage, exclusivity ceases to serve as an incentive to innovation, but begins to resemble exclusion, triggering the very regulatory oversight that the Act enables the CCI to provide.
By ousting the CCI, a body specialised in dealing with, recognising, and penalising anti-competitive conduct, the earlier decisions have only caused weakening of the competition law regime that in itself is very nascent and less than three decades old. The authorities under the Patents Act or any other sector-oriented authorities, cannot substitute the role of the CCI as those statutes aren't written with keeping competition analysis as a core function. Industries such as the pharmaceutical industry that are heavily governed by the Patents Act, through these decisions have been completely left out of the ambit of the Competition Act. In future, if the Supreme Court upholds the NCLAT decisions furthering the divide, the CCI might get divorced from other industries as well through the same reasoning. Such quakes are already felt in the telecom industry where the Supreme Court's finding of concurrent jurisdiction of the CCI in Competition Commission of India v. Bharti Airtel,[8] has led to additional steps wherein TRAI must first decide technical and jurisdictional issues before the matter can be taken up by the CCI leading to delay and weakened antitrust enforcement. If the trend of immunising entire sectors from the antitrust scrutiny continues, the day is not far from when the Competition Act and the institutional framework it has painstakingly created becomes completely irrelevant.
Competition Commission of India v. Swapan Dey & Anr. Civil Appeal No. 519/2026 2026 LLBiz SC 41. ↑
Mr. Swapan Dey v. Competition Commission of India & Anr. Competition Appeal (AT) No. 5 of 2023. ↑
Patents Act, 1970, No. 39, Acts of Parliament, 1970 (India). ↑
Id. ↑
Competition Act, 2002, Section 3(5)(i)(b). No. 12, Acts of Parliament, 2003 (India). ↑
Competition Act, 2002, Section 19(3). No. 12, Acts of Parliament, 2003 (India). ↑
Competition Act, 2002, Section 62. No. 12, Acts of Parliament, 2003 (India). ↑
CCI v Bharti Airtel Ltd. AIR 2019 SC 113. ↑
The authors are Law students. Views are personal