Are Merger Regulations Diluting Parliamentary Intent?
Economic and Politcal Weekly, Vol. 43, Nos. 26-27, pp. 10-13, June 28, 2008
7 Pages Posted: 10 Jul 2008
India's Competition Act (2002) was amended in 2007, modifying inter alia the Act's thresholds for merger review, and requiring mandatory rather than voluntary notification of mergers above the revised thresholds. This created considerable opposition in international business and legal circles. Draft merger regulations proposed by the Competition Commission of India (CCI) in early 2008 have responded by categorizing mergers which do not fulfill a two-firm local nexus requirement as those unlikely to cause an appreciable adverse effect on competition in India. We critically evaluate this claim and argue on the basis of international and Indian experience that the regulations will result in the CCI turning a blind eye to cross-border mergers designed to pre-empt potential competition or competition from small "maverick" firms. The regulations dilute parliamentary intent in requiring mandatory notification.
Keywords: Merger review, antitrust, India, competition law, multinationals
JEL Classification: K21, L40
Suggested Citation: Suggested Citation