Competition Commission amends rules related to combinations
Updated: Apr 03, 2014 01:30:42pm
New Delhi, Apr 3 (KNN) In order to ensure stricter compliance with competition norms, the regulator has tightened the rules relating to combinations among enterprises that would require approval of the Competition Commission of India (CCI).
CCI has clarified that it will look at the substance of the transaction and has mandated to keep a tab on unfair trade practices in the market place.
With new amendments, the focus would be on substance of proposed combinations rather than their structure when it comes to seeking approval from the CCI.
The provisions of the Competition Act, 2002 (“Act”) relating to the regulation of combinations as well as the Combination Regulations have been in force with effect from 1st June 2011, Ministry of Corporate Affairs has said.
The Combination Regulations were amended twice on 23rd February 2012 and 4th April 2013, with a view to relax filing requirements in respect of transactions not likely to raise competition concerns, provide certainty, reduce compliance requirements and make filings simpler.
In continuation of these efforts, the CCI has further amended the Combination Regulations on 28th March 2014 to, inter alia, simplify and provide greater clarity on the application of the combination provisions of the Act and the Combination Regulations, the Ministry said.
“To provide greater certainty on the requirement of filing notice, it has been clarified that the notification requirement shall be determined with respect to the substance of the transaction and structure of transaction(s) having the effect of avoiding notice shall be disregarded,” according to an official statement.
“Item (10) of Schedule I is deleted with a view to avoid ambiguity and uncertainty regarding insufficient local nexus and effect on markets in India,” it added.
The fee for filing forms by enterprises has been increased. The fee for filing Form I under various combinations has been hiked to Rs 15 lakh from Rs 10 lakh. The fee for submitting Form II has also been increased to Rs 50 lakh from Rs 40 lakh.
It has been decided to delete regulation 29 which was perceived to impose an additional condition in respect of preferring appeal in matters relating to combinations.
Form I has limited information while Form II is more elaborate. Moreover, enterprises entering into combination would now have to furnish details related to whether the proposed transaction is subject to filing requirements in other jurisdictions. The ministry of corporate affairs notified CCI (procedure with regard to the transaction of business relating to combinations) Amendment Regulations, 2014 on March 28.
“This measure is expected to benefit the parties with appropriate guidance on the requirements of combination provisions of the Act and the Combination Regulations. .As before, the pre-filing consultation would continue to be informal and verbal and the consultations offered would not be deemed to be the opinion of the Commission in any manner whatsoever or binding on the CCI,” the Ministry said. (KNN/SD)
CCI has clarified that it will look at the substance of the transaction and has mandated to keep a tab on unfair trade practices in the market place.
With new amendments, the focus would be on substance of proposed combinations rather than their structure when it comes to seeking approval from the CCI.
The provisions of the Competition Act, 2002 (“Act”) relating to the regulation of combinations as well as the Combination Regulations have been in force with effect from 1st June 2011, Ministry of Corporate Affairs has said.
The Combination Regulations were amended twice on 23rd February 2012 and 4th April 2013, with a view to relax filing requirements in respect of transactions not likely to raise competition concerns, provide certainty, reduce compliance requirements and make filings simpler.
In continuation of these efforts, the CCI has further amended the Combination Regulations on 28th March 2014 to, inter alia, simplify and provide greater clarity on the application of the combination provisions of the Act and the Combination Regulations, the Ministry said.
“To provide greater certainty on the requirement of filing notice, it has been clarified that the notification requirement shall be determined with respect to the substance of the transaction and structure of transaction(s) having the effect of avoiding notice shall be disregarded,” according to an official statement.
“Item (10) of Schedule I is deleted with a view to avoid ambiguity and uncertainty regarding insufficient local nexus and effect on markets in India,” it added.
The fee for filing forms by enterprises has been increased. The fee for filing Form I under various combinations has been hiked to Rs 15 lakh from Rs 10 lakh. The fee for submitting Form II has also been increased to Rs 50 lakh from Rs 40 lakh.
It has been decided to delete regulation 29 which was perceived to impose an additional condition in respect of preferring appeal in matters relating to combinations.
Form I has limited information while Form II is more elaborate. Moreover, enterprises entering into combination would now have to furnish details related to whether the proposed transaction is subject to filing requirements in other jurisdictions. The ministry of corporate affairs notified CCI (procedure with regard to the transaction of business relating to combinations) Amendment Regulations, 2014 on March 28.
“This measure is expected to benefit the parties with appropriate guidance on the requirements of combination provisions of the Act and the Combination Regulations. .As before, the pre-filing consultation would continue to be informal and verbal and the consultations offered would not be deemed to be the opinion of the Commission in any manner whatsoever or binding on the CCI,” the Ministry said. (KNN/SD)
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