The term RTP primarily refers to a Restrictive Trade Practice, a concept defined under the now-repealed Monopolies and Restrictive Trade Practices (MRTP) Act, 1969. An RTP was an act or practice that had the effect of preventing, distorting, or restricting competition, or tending to obstruct the flow of capital or profits in the market. A less common, but contemporary, meaning is Related Party Transaction (RPT), which involves monetary dealings between a company and its directors, key managers, or subsidiaries, regulated by the Companies Act, 2013, and SEBI regulations.
The MRTP Act, 1969, was an institution/act enacted to address the problem of concentration of economic power in the hands of a few large industrial houses, a concern rooted in the Directive Principles of State Policy, particularly Article 39(c). The Act came into full operation on June 1, 1970. Its mechanism involved the MRTP Commission, a quasi-judicial body, which had the power to investigate complaints and issue 'cease and desist' orders against businesses engaging in RTPs. For example, the Supreme Court, in the Sirmur Truck Operator's Case, held that a cartelized agreement among operators was an RTP under Section 2(o) of the Act.
The entire framework underwent a significant change with the economic liberalization of the 1990s. The MRTP Act, 1969, was replaced by the Competition Act, 2002, which was fully implemented on September 1, 2009. The focus shifted from a 'command-and-control' approach of curbing monopolies to a modern, pro-active stance of promoting competition. Consequently, the MRTP Commission was converted into the Competition Commission of India (CCI). The new Act addresses anti-competitive agreements and abuse of dominant position, which are the modern equivalents of the earlier RTPs.