Credit- Suzanne Rab
King & Spalding
Specifically, the “Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Amendment Regulations, 2012”, makes several significant changes to the Combination Regulations which were issued on 11 May 2011.
Key points include:
· An exemption for acquisitions of less than 25% of equity shares or voting rights in the ordinary course of business or for investment purposes, without an acquisition of control;
· An exemption for buy-back of shares or subscription of rights issues of shares, not leading to an acquisition of control;
· A limited exemption for certain intra-group mergers and amalgamations involving subsidiaries wholly owned by the same group;
· A significant uplift in filing fees – the Form 1 fee is increased from INR 50,000 to INR 1,000,000 and for Form 2 (long form) the fee is increased from INR 1,000,000 to INR 4,000,000;
· Various changes to filing requirements; and
· A preference is expressed for notification using Form 2 (long form) in the case of overlap where the parties have market shares exceeding 15% (horizontal) and/or 25% (vertical).
With less than a full year of operation of the mandatory merger control regime it would be premature to draw robust conclusions from the decisions to date; still less to consider that they are necessarily a predictor for the future. Nevertheless, the publication of amendments to the existing combination regulations serves to indicate that the CCI is already clarifying ambiguities in the underlying legislation through its practice.