The Competition Commission of India (CCI) has amended the Combination Regulations with a view to further simplify the filing requirements and bring about greater certainty in the application of the Act and the Regulations.
The provisions of the Competition Act, 2002 (“Act”) relating to regulation of combinations have been in force with effect from 1st June, 2011.
These were subsequently amended on 23.2.2013 with a view to relax certain requirements in regard to filings by corporate entities for combinations that are unlikely to raise adverse competition concerns.
The highlights of the major changes in the Combination Regulations are as under:
1. The Regulations now do not require a notice to be filed for acquisition of shares or voting rights of companies if the acquisition is less than five percent of the shares or voting rights of the company in a financial year, where the acquirer already holds more than twenty five percent but less than fifty percent of the shares or voting rights of the company.
2. In a step which would significantly reduce compliance requirements, the provision for giving notice is now dispensed for mergers/amalgamations involving two enterprises where one of the enterprises has more than fifty per cent (50%) shares or voting rights of the other enterprise. Similarly, the requirement of giving notice is also dispensed for merger or amalgamation of enterprises in which more than fifty per cent (50%) shares or voting rights in each of such enterprises are held by enterprise(s) within the same group.
3. To provide clarification on the nature of intra-group acquisitions for which notice has to be given, Item 8 of Schedule I is amended to state that the relaxation would not apply where the acquired enterprise is jointly controlled.
4. To avoid repetition and to have one category of exemption for acquisition of certain current assets like stock-in-trade, raw materials etc., Item 5 and Item 9 of Schedule I are clubbed and provided as one category under Item 5.Tags : Corporate Law