New CCI norms increase 'uncertainty' about filing requirements

Fair trade regulator CCI's recent amendments to combination regulations increase "uncertainty and ambiguity" about the scope of information required to be submitted while seeking nod for M&A deals, says a report.
After gathering public comments, the Competition Commission of India (CCI) earlier this month amended the combination regulations as part of efforts to streamline merger control.
While the watchdog is of the view that the changes make the regulations more forward looking, there are apprehensions about their overall impact.
"The recent amendment regulations are a mixed bag; while they address a few key concerns, they increase uncertainty and ambiguity about timelines and the scope of information required to be filed," law firm Shardul Amarchand Mangaldas said in a recent report.

Various changes have been made by CCI, including the timeline for first phase review which has been modified to 30 working days from the earlier 30 calendar days.
Among others, the regulator can now invalidate a notice seeking approval in case the same is incomplete.

According to the report, while CCI will record reasons for the invalidation, it does not offer the parties an opportunity of being heard.
"Also, CCI may or may not ask the parties to clear the defects before invalidating the notice. Moreover, as the decision to invalidate a notice may be treated as an administrative decision, it is unlikely to be appealable to the Competition Appellate Tribunal under the specified sections.

"This could lead to immense uncertainty and limited options for the notifying parties, having an adverse impact on clearance timelines, particularly in global transactions," it said.
According to Shardul Amarchand Mangaldas, there are also "welcome" changes in the amended regulations.
"In an extremely welcome change, CCI now permits any person authorised by the board of directors to sign and verify the contents of the notice (along with documentary proof). This will go a long way in reducing the administrative inconvenience to notifying parties," it said.