India: Merger Control (3rd edition)

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This country-specific Q&A provides an overview to merger control laws and regulations that may occur in India.

It will cover jurisdictional thresholds, the substantive test, process, remedies, penalties, appeals as well as the author’s view on planned future reforms of the merger control regime.

This Q&A is part of the global guide to Merger Control. For a full list of jurisdictional Q&As visit

  1. Overview

    Sections 5 and 6 of the Competition Act, 2002, as amended (“Competition Act”) deal with the substantive provisions regarding notifying “combinations” to the Competition Commission of India (“CCI”). A combination is a merger, acquisition, or amalgamation which qualifies the notifiability based asset and turnover thresholds provided under Section 5 of the Competition Act.

    The CCI promulgated the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011 (“Combination Regulations”) on 11 May 2011, setting in place the framework for review of pre-merger notifications by the CCI. The Combination Regulations came into effect from 1 June 2011.

  2. Is mandatory notification compulsory or voluntary?

    India is a suspensory, compulsory merger control regime. Under the Indian merger control regime, a combination must be notified to the Indian competition authority i.e., the CCI, if it satisfies any of the prescribed asset or turnover thresholds (“Jurisdictional Thresholds”) under Section 5 of the Competition Act and does not qualify for any exemption provided in the Combination Regulations or the various notifications issued by the Government of India. There is no concept of a voluntary notification to the CCI. If the Jurisdictional Thresholds are not met, no notice can be filed with the CCI.

  3. Is there a prohibition on completion or closing prior to clearance by the relevant authority? Are there possibilities for derogation or carve out?

    Yes, Section 6(2A) of the Competition Act imposes a standstill obligation. A notified transaction cannot be completed until the CCI gives its approval or 210 calendar days have passed from the date of notification, whichever is earlier.

    If a CCI clearance has not been obtained, part or full consummation of the transaction is prohibited. As such the taking of any steps towards the implementation of the transaction, like closing the foreign leg of a transaction, depositing part of a refundable consideration, or putting shares in an escrow, etc., have been considered as gun-jumping by the CCI.

    There are no exceptions to the standstill obligation under the Competition Act.

  4. What types of transaction are notifiable or reviewable and what is the test for control?

    Combinations as defined above are notifiable to the CCI unless they can avail of any of the exemptions provided in Schedule I to the Combination Regulations, or in the various notifications issued by the Government of India through the Ministry of Corporate Affairs (“MCA”) from time to time.

    A Combination structured as a merger or an amalgamation is notifiable by all the transacting parties once it is approved by the boards of directors of the transacting parties. A Combination structured as an acquisition is notifiable by the acquirer after the definitive transaction agreement(s) or any other binding document(s) is executed between the parties.

    For the purposes of the Competition Act, “control” refers to joint control or single control over the management or affairs of an enterprise by one or more enterprises or groups. Control may be exercised by:

    • One or more enterprises, either jointly or singly, over another enterprise or group; or
    • One or more groups, either jointly or singly, over another group or enterprise.

    At this stage, various concepts of control are still being developed in India. In a few CCI merger control orders, the CCI has provided guidance on what constitutes control. For example, the CCI considers that the “ability to exercise decisive influence over the management or affairs” of a target enterprise constitutes “control” over such enterprise. The CCI has also held that joint control can be inferred in situations where more than one person has the power to influence “strategic commercial operations”. Such joint control may arise as a result of shareholding, veto rights, or the right to block commercial decisions resulting in a deadlock. The CCI has also held that veto rights such as approval of business plans, approval of annual operating plans which includes the annual budget, approval for commencing a new line of activity or discontinuing an existing line of business, and approval for the appointment of key managerial personnel and their compensation, amount to control. The CCI may continue to develop the notion of “control” through future decisions and possibly issue a formal guidance.

  5. In which circumstances is an acquisition of a minority interest notifiable or reviewable?

    Item I of Schedule I to the Combination Regulations, stipulates that an acquisition of less than 25% of the total shares or voting rights of an enterprise is exempt from the notification obligation in so far as the acquisition is made solely as an investment or in the ordinary course of business, and does not result in the acquisition of control.

    The explanation to Item I, Schedule I of the Combination Regulations provides that any acquisition of shares below 10% is considered to be made solely as an investment, subject to certain conditions provided here. Firstly, by way of the transaction, the acquirer should be able to exercise only such rights that are enjoyed by the ordinary shareholders of the target enterprise. Secondly, the acquirer should neither be a member of the board of directors of the target enterprise, nor have a right or intention to nominate a director on the board of directors of the target enterprise. Thirdly, the acquirer should not intend to participate in the affairs or management of the target enterprise.

  6. How are turnover, assets and/or market shares valued or determined for the purposes of jurisdictional thresholds?

    In order to determine the Jurisdictional Thresholds, the consolidated assets and turnover of the parties are taken into consideration (including all units, divisions and subsidiaries). When only a portion of an enterprise or a division or a business is being acquired or merged, or amalgamated, then the value of assets of only such portion or division or business, and the turnover attributable to such portion or division or business is considered for calculating the Jurisdictional Thresholds.

    Turnover is defined under Section 2(y) of the Competition Act to include the value of sale of goods or services.

    Assets as defined under explanation (c) of Section 5 of the Competition Act, are to be determined by taking the book value of the assets as shown in the audited books of account of the enterprise in the financial year immediately preceding the financial year in which the date of the proposed merger falls, as reduced by depreciation. The value of the assets include, the brand value; value of goodwill; value of copyright, patent, permitted use, collective mark, registered proprietor, registered trademark, registered user, homonymous geographical indication, geographical indications, design, or layout-design, or other similar commercial rights, if any.

  7. Is there a particular exchange rate required to be used to convert turnover and asset values?

    Yes, the conversion of the asset and turnover value from a foreign currency to INR or USD is required to be based on the average spot rate of the last six months quoted by the Reserve Bank of India from the date of the approval of the proposed merger or amalgamation by the board of directors of the transacting parties, or from the date of the execution of the acquisition agreement or any other document conveying an agreement to acquire shares/voting rights/control/assets of the target.

  8. In which circumstances are joint ventures notifiable or reviewable (both new joint ventures and acquisitions of joint control over an existing business)?

    Joint ventures are not afforded any distinct treatment under the Competition Act in terms of notifiability requirements. Under the Competition Act, an “acquisition of an enterprise” is notifiable. The reference to an “enterprise” has been defined by the Competition Act to mean an active or former business, rather than a prospective business. The prevailing view in India is that the formation of a “greenfield” joint venture (“JV”) would not be notifiable, since the parties do not contribute an already active or former business towards the formation of the JV and therefore there is no acquisition of an “enterprise”. Based on this view, the Competition Act’s merger control provisions cover only “brownfield” JVs (i.e., where an active or former business is being contributed to the JV by one or more of the JV parents). To assess the notifiability of a transaction, the value of the assets and turnover attributable only to the portion of the assets being transferred to the JV by the JV parents is considered for testing Jurisdictional Thresholds.

  9. Are there any circumstances in which different stages of the same, overall transaction are separately notifiable or reviewable?

    As per Regulation 9(4) of the Combination Regulations, where the ultimate effect of a transaction is achieved by way of a series of steps or smaller individual transactions which are inter-connected, then a single merger notification form is required to be filed with the CCI covering all the steps or individual transactions, if any of the stages or steps of the interconnect transaction is individually notifiable to the CCI.

  10. In relation to “foreign-to-foreign” mergers, do the jurisdictional thresholds vary?

    The Jurisdictional Thresholds are uniform and do not vary in case of “foreign-to-foreign” mergers.

    Foreign-to-foreign transactions are notifiable to the CCI if any of the Jurisdictional Thresholds are satisfied by the transacting parties. Given that the Competition Act contemplates a suspensory regime, the global transaction cannot be consummated in part or full, prior to receiving approval from the CCI.

  11. For voluntary filing regimes (only), are there any factors not related to competition that might influence the decision as to whether or not notify?

    Not applicable.

  12. What is the substantive test applied by the relevant authority to assess whether or not to clear the merger, or to clear it subject to remedies? Are there different tests that apply to particular sectors?

    The CCI by way of its review process examines whether a combination causes or is likely to cause an appreciable adverse effect on competition (“AAEC”) in the relevant market. To determine whether a combination causes AAEC or not, the CCI assesses the combination with regards to the various factors set out in Section 20(4) of the Competition Act. Set out below are the factors mentioned under Section 20(4) of the Competition Act:

    • actual and potential level of competition through imports in the market;
    • extent of barriers to entry in the market;
    • level of combination in the market;
    • degree of countervailing power in the market;
    • likelihood that the combination would result in the parties to the combination being able to significantly and sustainably increase prices or profit margins;
    • extent of effective competition likely to sustain in a market;
    • extent to which substitutes are available or are likely to be available in the market;
    • market share, in the relevant market, of the persons or enterprise in a combination, individually and as a combination;
    • likelihood that the combination would result in the removal of a vigorous and effective competitor or competitors in the market;
    • nature and extent of vertical integration in the market;
    • possibility of a failing business;
    • nature and extent of innovation;
    • relative advantage, by way of the contribution to the economic development, by any combination having or likely to have an AAEC; and
    • whether the benefits of the combination outweigh the adverse impact of the combination, if any.

    Post filing of the merger notification form, the CCI takes 30 working days to form a prima facie opinion of whether or not the combination is likely to cause an AAEC in the relevant market. This is referred to as the Phase I review, during which the CCI may direct the parties to provide additional information to conduct its AAEC assessment. Additionally, parties may also propose amendments to the combination prior to the CCI forming its prima facie opinion. Thereafter, the CCI either approves the combination with or without modifications (where the parties have proposed any) or proceeds to conduct a Phase II review. A Phase II review is a more detailed assessment of the combination which may take up to 210 days from the date of filing the merger notification form.

    The parameters set out in Section 20(4) of the Competition Act are applied by the CCI while examining all transactions uniformly. The factors do not change based on sectors.

  13. Are factors unrelated to competition relevant?

    While assessing a combination, the CCI may consider non-competition related factors such as the financial health of the target enterprise, whether the acquisition or merger is triggered on account of corporate restructuring, whether any state undertaking is involved, etc., on a case to case basis.

  14. Are ancillary restraints covered by the authority’s clearance decision?

    Yes, ancillary restraints such as non-compete restrictions are covered within the CCI’s analysis of the filing. Typically, only such ancillary restraints that are directly related and necessary for implementation of the transaction are allowed.

    In this regard, the CCI has issued a non-binding Guidance Note on Non-Compete Restrictions (“Guidance Note”) highlighting its approach towards non-compete clauses. The Guidance note clarifies that (i) an ancillary non-compete restriction is one which is directly related to, necessary and reasonably required to implement the proposed combination and (ii) a finding that a covenant is not ancillary to the combination does not automatically imply that the covenant contravenes the Competition Act.

  15. For mandatory filing regimes, is there a statutory deadline for notification of the transaction?

    The CCI must be notified of the proposed combination using the appropriate form after the “trigger event” but before any step is taken towards the consummation of the proposed combination.

    Before 29 June 2017, it was mandatory to give this notice within 30 calendar days of the trigger event. However, the parties can now notify the CCI any time after the trigger event but cannot close a combination or any part thereof without the approval of the CCI. This exemption is currently available until 28 June 2022, unless otherwise extended.

  16. What is the earliest time or stage in the transaction at which a notification can be made?

    A notification can be filed once a trigger event has occurred. The “trigger events” are:

    • Board approval for a proposed merger or amalgamation under Section 5(c) of the Competition Act; or
    • the execution of any agreement or other document conveying an agreement or decision to acquire shares/voting rights/control/assets under the Sections 5(a) and (b) of the Competition Act.
  17. Is it usual practice to engage in pre-notification discussions with the authority? If so, how long do these typically take?

    The Combination Division of the CCI can be approached for non-binding, informal verbal consultations prior to notifying a proposed combination for substantive and/or procedural issues. Once a request for a pre-filing consultation has been made, the CCI usually replies within a week with the details of the meeting. Further, this facility is being increasingly undertaken for substantive pre-merger discussions with the CCI prior to formal filing to enable parties to file a merger notification complete in all respects and pre-empt/minimize further information requests from the CCI.

  18. What is the basic timetable for the authority’s review?

    An indicative Timeline for first stage (commonly referred to as Phase I) combinations is as follows:



    Time Taken

    Execution of transaction documents:


    Day 0

    Submission of notification with the CCI:


    Any time after Day 0 prior to consummation of the transaction in part or full (“X”)

    Approval from CCI


    Any time before the expiry of 30 working days from X

    Initiation of a Phase II review after CCI is of the prima facie opinion that the combination will cause an AAEC


    Any time before the expiry of 210 calendar days from X.
    In this regard, it is important to note that if the CCI directs modifications to the combination as a precursor for an approval, then the parties have an option to not accept the modification provided by the CCI, but to offer a modified proposal to the CCI. This modified proposal is to be provided by the parties within 30 working days (“Counter Proposal Period”). Further, post the proposed modifications, if the CCI does not approve of the counter modifications proposed by the parties, the CCI will afford the parties an additional 30 working days to accept the original modifications proposed by the CCI (“Post Proposal Period”). The Counter Proposal Period and the Post Proposal Period of total 60 working days is excluded from the calculation of the 210 days from the date of filing the merger notification form with the CCI.

    For more details on the timelines, please see the response to Question 20 below.  

  19. Under what circumstances may the basic timetable be extended, reset or frozen?

    In the course of a Phase I review, the CCI may seek additional information from the parties to determine as to whether or not the combination causes an AAEC in the relevant market. The calculation of the 30 working days period may be suspended (referred to as a “Clock Stop”) during the time taken by the parties to respond to any such information requests from the CCI.

    For example, if the CCI issues a request for additional information 20 working days after the notice is filed and the parties respond after 7 working days, for the purposes of calculating the 30 working-day period, the 28th working day shall be considered as the 21st working day for the purposes of the Competition Act. Consequently, where the CCI seeks additional information, a typical Phase I investigation lasts considerably longer than strict 30 working days.

    Pursuant to the amendment to the Combination Regulations in July 2015, A Clock Stop is permitted for a maximum of 15 working days, when the CCI seeks information from third parties while assessing a combination.

    If the CCI does not pass an order within 210 calendar days from the date of filing the notice, the notified transaction is deemed approved. There is no mechanism for extending the 210 day period. In this regard, as provided above in response to query 19, the Counter Proposal Period and the Post Proposal Period of total 60 working days is excluded from the calculation of the 210 days from the date of filing the merger notification form with the CCI.

  20. Are there any circumstances in which the review timetable can be shortened?

    There is no provision for shortening the statutory period of 210 days. However, the CCI at its own volition may arrive at a decision prior to the expiry of the 210 days period.

  21. Which party is responsible for submitting the filing?

    Where the proposed combination is structured as an acquisition, the acquirer is obligated to file the merger notification with the CCI.

    Where the proposed combination is structured as a merger or amalgamation, all the merging or amalgamating parties are required to submit the merger notification notice jointly to the CCI.

  22. What information is required in the filing form?

    The merger notification for prior approval can be filed in short form; however, where there is a horizontal overlap of more than 15 per cent or a vertical overlap of more than 25 per cent, the merger notification is usually filed in the long form.

  23. Which supporting documents, if any, must be filed with the authority?

    Notifying Parties typically need to provide the following supporting documents while filing a Form I:

    • Copies of the transaction documents;
    • Copies of the most recent annual reports;
    • Copies of the financial statements of the parties to the combination;
    • Copies of all presentations prepared by or for or received by any members of the board of management, or the board of directors, or the supervisory board, as applicable in the light of the corporate governance structure, or the other person(s) exercising similar functions (or to whom such functions have been delegated or entrusted), or the shareholders meeting, analyzing the combination. (This is required only where the parties to the combination are engaged in the production of vertically or horizontally overlapping products or services);
    • Declaration by the notifying party verifying the contents of the Form;
    • Affidavit by the notifying party(ies) claiming confidentiality over the confidential information provided in the merger notification form;
    • A Letter of authorisation from the notifying party granting authority to any individual to sign all documents relating to the merger notification form and to receive communication(s) on behalf of the notifying party(ies);
    • Certified copy of the authorisation in favour of the legal representative filing the merger notification form;
    • Certified copy(ies) of the order(s)/decision(s) passed in other jurisdictions where the proposed combination has been filed and approved;
    • Copy of the proof of payment of the filing fee for the merger notification form;
    • Certificate of accounts from the for any unaudited financial statement or figures certified by the Managing Director, Director, CEO or the CFO duly authorized by the board of directors accompanies by a certificate of the auditor of the enterprise.

    Please note that the above mentioned is an indicative list and depending on the transaction, other documents may also be required to be furnished.

    Certain additional documents required to be filed along with a Form II are provided in query 7 to the Form II. The Form II is embedded in the response to the above question.

  24. Is there a public announcement that a notification has been filed?

    Yes, upon filing of the merger notification, the CCI uploads on its website a summary of the combination. The Summary is required to be no more than 500 words and does not contain any confidential information.

    As such, the summary comprises, (a) names of the parties to the combination; (b) the type of the combination; (c) the area of activity of the parties to the combination; and (d) the relevant market(s) to which the combination relates.

  25. Does the authority seek or invite the views of third parties?

    According to Regulation 19(3) of the Combination Regulations, during the period of Phase I review, the CCI, where it deems necessary, may call for information from any third party to determine whether a combination causes or is likely to cause an AAEC.

    In the course of a Phase II review, where the CCI forms a prima facie opinion that the combination causes or is likely to cause an AAEC, the CCI under Section 29(2) of the Competition Act directs the parties to publish details of the combination to bring it to the knowledge of the public and persons affected or likely to be affected (“Public Disclosure”). Furthermore, the CCI may invite any third party to file written objections; within 15 working days of the Public Disclosure.

  26. What information may be published by the authority or made available to third parties?

    Please see the response to Question 26 above.

    The Public Disclosure is made in a manner which the CCI thinks is appropriate to bring the combination to the knowledge or information of the public and persons affected or likely to be affected by the combination.

  27. Does the authority cooperate with antitrust authorities in other jurisdictions?

    Yes, the CCI has entered into Memorandums of Understanding with various antitrust regulators across the globe, including, Australia, Canada, European Union, United States of America, the Federative Republic of Brazil, the Russian Federation, the People’s Republic of China and the Republic of South Africa.

    The CCI has cooperated with a few counterparts in other jurisdictions on recent global mergers in Dow/DuPont, Bayer/Monsanto, Linde/Praxair, etc.

  28. What kind of remedies are acceptable to the authority?

    The CCI can impose structural or behavioural remedies or a combination of structural and behavioural remedies.

    The remedy proposed by the CCI generally provide for the mode, manner, and conditions of implementation of the remedy. In cases of divestments, the CCI also approves the purchaser of the divested assets, shares, etc. The parties may either accept the CCI remedies or submit amendments to the CCI’s proposal. The same is either accepted by the CCI, or the parties are required to accept the remedies as was initially directed by the CCI.

    By way of an example, in the Lafarge/Holcim combination, the CCI directed pure divestments (structural remedies) to allay any anti-competitive concerns caused by the Proposed Combination. While in the Bayer/Monsanto combination, to alleviate any anti-competitive concerns, the CCI imposed certain divestment orders along with certain behavioural commitments for a period of 7 and 10 years.

  29. What procedure applies in the event that remedies are required in order to secure clearance?

    It is critical to note that the merger control “clock” stops for the time taken by the CCI to evaluate modifications proposed by the parties to the combination. In the first stage, the CCI may clear the transaction with modifications (i.e., remedies) proposed by the parties. If the parties offer a modification in Phase I, additional time of up to 15 calendar days can be taken by the CCI for evaluation of the modification.

    In case of a modification proposed by the CCI, the parties may agree with the CCI, disagree and negotiate with the CCI or file an appeal before the NCLAT within 60 calendar days of the CCI’s order. Whenever the CCI proposes modifications to a combination, it can appoint an independent monitoring agency (i.e., accounting firms, management consultants, or any other professional firm) to oversee the implementation of the CCI’s decision or the parties’ commitment.

    The clearance of the combination depends on the implementation of the remedies and approval may be revoked if the remedies are not implemented.

  30. What are the penalties for failure to notify, late notification and breaches of a prohibition on closing?

    The CCI can impose penalties under Section 43A of the Competition Act if a party fails to file a merger notification as per the Competition Act. As such, a penalty under Section 43A may be imposed for failure to notify a notifiable transaction, for notification post part or full consummation of the combination and/or for gun jumping.

    The maximum penalty that the CCI can impose under Section 43A of the Competition Act is 1% of the total turnover or assets, whichever is higher, of such a combination. To date, a maximum penalty of INR 50 million (Indian Rupees Fifty million) has been imposed for gun-jumping.

  31. What are the penalties for incomplete or misleading information in the notification or in response to the authority’s questions?

    The CCI can impose a penalty under Section 44 of the Competition Act against any person for making a statement which is false in any material particular, or makes a false statement knowingly, or for omitting to state any material particular knowing such information to be material.

    The maximum penalty that the CCI can impose under Section 44 of the Competition Act is INR 10 million(Indian Rupees Ten million) and the minimum is INR 5 million (Indian Rupees Five million).

  32. Can the authority’s decision be appealed to a court?

    In case of rejection, the parties have a right of appeal to the National Company Law Appellate Tribunal. The final appellate authority on points of law is the Supreme Court of India.

  33. What are the recent trends in the approach of the relevant authority to enforcement, procedure and substantive assessment?

    In the past, the CCI has imposed penalties for delayed filing of the notice with respect to acquisitions, mergers, or amalgamations under Section 43A of the Competition Act.

    In the past, parties to a notifiable transaction were under an obligation to file the notice with the CCI within 30 calendar days of the trigger event. However, on 29 June 2017, the MCA exempted, for a period of five years, every person or enterprise from the obligation to give notice to the CCI within 30 days of the trigger event. This exemption is currently available until 28 June 2022. This is a welcome step as it aligns the Indian merger control regime with internationally accepted best practices. As a result, like the European Union, the key is to obtain CCI clearance prior to deal consummation, rather than an arbitrary deadline to file after the triggering event.

    In 2017, the MCA introduced a series of exemptions from notification obligations under Sections 5 and Section 6 of the Competition Act. Details of the exemption have been provided below:

    • On 22 November 2017, the MCA exempted all cases of combinations involving Central Public Sector Enterprises and their wholly or partly owned subsidiaries operating in the Oil and Gas Sectors under the Petroleum Act, 1934 and/or Oilfields (Regulation and Development) Act, 1948 for a period of 5 years, i.e., until 21 November 2022.
    • On 30 August 2017, the MCA exempted all cases of reconstitution, transfer of the whole or any part thereof, and amalgamation of nationalized banks under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 and the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 for a period of 10 years, i.e., until 29 August 2027.
    • On 10 August 2017 the MCA exempted all Regional Rural Banks in respect of which the Central Government has issued a notification under sub section (1) of section 23A of the Regional Rural Banks Act, 1976 for a period of 5 years, i.e., until 9 August 2022.
  34. Are there any future developments or planned reforms of the merger control regime in your jurisdiction?

    The CCI has published the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Amendment Regulations, 2018, and invited comments from stakeholders. The key points of the proposed changes are as follows:

    • The proposed insertion provides flexibility to parties to either "withdraw a filed merger notification form and refile a fresh merger notification form or simply notify the CCI of any change to the filed merger notification form.
    • Parties to a proposed combination will now have the liberty to propose a modification which is in line with the scheme and intent of the proposed combination, instead of navigating a modification proposed by the CCI. It may be noted that this amendment will save time as the parties will not have to wait for the CCI to order modifications after a long-drawn Phase II review process, before the parties can offer their counter/ modification proposal.
    • Reducing the scope of the exemption provided in Item 1 of Schedule I to the combinations pertaining to minority acquisitions (“Item 1 Exemption”). The Item 1 Exemption will not be applicable to parties to a combination who have a horizontal or a vertical overlap. Further, for pooled vehicles and alike, only an acquisition of shares below 5% will be deemed to be made solely as an investment.
    • Introducing the concept of clock stops in the calculation of the 210-day period based on time taken by parties with respect to information requests from the CCI, etc.