EXECUTIVE SUMMARY

The year 2024 marked a pivotal shift in India’s merger control regime with the notification of the Competition Commission of India (Combinations) Regulations, 2024 and the Competition (Criteria for Exemption of Combinations) Rules, 2024. These reforms, introduced under the amended Competition (Amendment) Act, 2023, fundamentally transform how mergers, acquisitions, and amalgamations are assessed for competition clearance. The new framework seeks to modernize India’s antitrust regime in line with global best practices, particularly to address the challenges posed by digital markets and high-value transactions involving asset-light enterprises.

A key innovation is the Deal Value Threshold (DVT)—a supplementary notification trigger requiring parties to seek CCI approval if the value of the transaction exceeds INR 2,000 crore, provided the target enterprise has “significant business operations” (SBO) in India. This provision ensures that transactions involving large market players with limited Indian assets but substantial user bases—such as digital or technology-driven entities—are not left outside the regulatory net merely because they fall below traditional asset or turnover thresholds. The introduction of the SBO test further refines jurisdictional assessment by linking not just financial parameters but also operational presence, user engagement, or local business activities.

The 2024 Combination Regulations also streamline notification procedures, timelines, and review mechanisms. The revised Form I and Form II emphasize self-assessment, fast-track approvals, and digital submissions. The CCI has reduced redundancy in documentation, simplified disclosure requirements for minority acquisitions, and clarified exemptions under the de-minimis rule. Additionally, the new Combination Exemption Rules, 2024 rationalize earlier exemptions, introducing clarity for intra-group transactions, investment funds, and minority shareholdings.

From a compliance and transactional perspective, these reforms have far-reaching implications. Dealmakers must now incorporate early CCI screening into due diligence and valuation exercises, particularly for cross-border and digital transactions. The Deal Value Threshold creates a new regulatory layer requiring coordination among the CCI, SEBI, RBI, and NCLT, especially in cross-border mergers where the Companies Act, FEMA, and Competition Act overlap.

INTRODUCTION

The regulatory landscape governing mergers and acquisitions (M&A) in India has undergone a significant transformation following the enactment of the Competition Commission of India (Combinations) Regulations, 2024¹ and the Competition (Criteria for Exemption of Combinations) Rules, 2024². These instruments operationalise the legislative amendments introduced through the Competition (Amendment) Act, 2023, which was designed to modernise India’s merger-control regime and align it with evolving global practices. The reforms aim to bridge the regulatory gap that previously allowed high-value, asset-light, and digital-market transactions to escape scrutiny under the traditional asset and turnover-based thresholds.

Historically, combinations under Section 5 of the Competition Act 2002³ were notifiable to the Competition Commission of India (CCI) only when prescribed thresholds of assets or turnover were exceeded. However, the rise of technology-driven enterprises with limited physical assets but enormous market influence—such as social-media, fintech, and e-commerce platforms—exposed a structural deficiency in this model. In response, the Deal Value Threshold (DVT) was introduced through the 2023 amendment, subsequently implemented by the 2024 Regulations. The DVT mandates that any transaction where the deal consideration exceeds INR 2,000 crore and where the target has “significant business operations” (SBO) in India must be notified to the CCI, regardless of asset or turnover levels.⁴

The concept of significant business operations introduces a qualitative and quantitative test for nexus with the Indian market. Regulation 9 of the 2024 Regulations⁵, read with the accompanying Exemption Rules, empowers the CCI to evaluate whether an enterprise has a material presence in India by considering parameters such as user base, assets located in India, revenue derived from Indian customers, and local business operations. This change represents a paradigm shift from a purely financial to a value-and-impact-based merger-control framework, enhancing the Commission’s ability to oversee digital-economy mergers.

Beyond competition law, mergers—particularly cross-border ones—invoke the jurisdiction of multiple regulators. The Securities and Exchange Board of India (SEBI) governs listed entities under the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015 and the Master Circular for Scheme of Arrangement (2023)⁶. SEBI’s role centres on protecting investor interests, mandating disclosures, valuation reports, and prior approvals from stock exchanges before submission to the National Company Law Tribunal (NCLT). Meanwhile, the Reserve Bank of India (RBI) oversees the foreign-exchange dimension of such mergers under the Foreign Exchange Management Act 1999 (FEMA)⁷ and the FEMA (Cross-Border Merger) Regulations 2018⁸, ensuring compliance with capital-account and repatriation norms.

The NCLT, constituted under the Companies Act 2013⁹, acts as the approving authority for schemes of merger and amalgamation under Sections 230–234, providing judicial oversight to ensure fairness, creditor protection, and regulatory compliance. Consequently, the approval process for a cross-border merger in India involves inter-regulatory coordination among the CCI, SEBI, RBI, and NCLT, each operating under distinct statutory mandates but with overlapping timelines and conditions.

Research Aims and Key Questions

The first aim of this research is to undertake a comprehensive statutory and policy analysis of the CCI (Combinations) Regulations, 2024 and the associated Exemption Rules, 2024, focusing on the introduction of the Deal Value Threshold and the criteria for computing “significant business operations.” Specifically, it seeks to answer:

1. What are the material changes introduced by the CCI (Combinations) Regulations, 2024 and the Exemption Rules, and how do these provisions redefine the scope of notifiable combinations in India?

The second aim is to explore the interplay between the Companies Act, FEMA, and Competition Act in the context of cross-border mergers. It seeks to map procedural intersections between the CCI, SEBI, RBI, and NCLT and examine their practical implications for transaction timelines and compliance. Accordingly, the key research question is:

2. How do SEBI, RBI, and NCLT approvals interact in cross-border mergers, and what are the resultant procedural and temporal implications for stakeholders under Indian corporate law?

Scope, Limitations, and Methodology

This memorandum focuses on statutory and regulatory developments up to September 2024, limiting its scope to Indian merger-control and corporate-law frameworks with comparative references to the European Union Merger Regulation (EUMR)¹⁰ and the US Hart-Scott-Rodino Act 1976¹¹ for contextual analysis. It does not address sector-specific regulators such as the IRDAI or TRAI except where they indirectly affect merger approval.

The research methodology combines doctrinal analysis and comparative study. Primary materials—statutes, notifications, and official circulars—are examined to identify legal changes and interpretive challenges. Secondary sources, including academic commentaries, case law (e.g. CCI v Thomas Cook India Ltd (2014)¹² and Amazon.com NV Investment Holdings LLC/Future Coupons Pvt Ltd (2021)¹³), and policy papers are employed to assess the practical application of the law. The study also relies on practitioner briefings and law-firm alerts to evaluate industry perception and implementation challenges.

Given the novelty of the 2024 regime, judicial interpretation remains limited; thus, the analysis relies heavily on legislative text and comparative frameworks. The paper adopts a descriptive-analytical approach, using statutory interpretation and regulatory mapping to identify overlaps, predict compliance bottlenecks, and propose recommendations for synchronized regulatory timelines in cross-border mergers.

LEGAL AND REGULATORY FRAMEWORK

Merger control in India is governed primarily by the Competition Act, 2002, as amended by the Competition (Amendment) Act, 2023, alongside the CCI (Combinations) Regulations, 2024, and the Competition (Criteria for Exemption of Combinations) Rules, 2024. The statutory ecosystem further interacts with sectoral and procedural laws such as the Companies Act, 2013, the Foreign Exchange Management Act, 1999 (FEMA), and the regulatory frameworks of SEBI and RBI. These laws collectively establish the contours of regulatory oversight in merger transactions, particularly in cross-border contexts where multiple authorities are involved.

Under Section 5 and Section 6 of the Competition Act, combinations—defined to include acquisitions, amalgamations, or mergers—require prior notification to the Competition Commission of India (CCI) if specified asset or turnover thresholds are exceeded. The aim is to prevent acquisitions that may cause an appreciable adverse effect on competition (AAEC) within the relevant market in India. The CCI operates on an ex-ante model of merger control, requiring mandatory pre-closing clearance where thresholds are met. Since the CCI’s inception in 2009, it has evaluated over 1,000 combination filings, most cleared under the short-form Form I, with only a small fraction proceeding to detailed scrutiny under Form II. The ICLG Business Reports highlight that the Indian merger control regime is now one of the most efficient globally, with the average Phase I clearance period being around 23 working days.¹⁴

The CCI (Combinations) Regulations, 2024 represent the most comprehensive reform of India’s merger control framework in over a decade. These regulations replace the earlier 2011 Combination Regulations, introducing structural and procedural innovations aimed at streamlining the approval process. Notably, the 2024 Regulations codify the Deal Value Threshold (DVT) mechanism under Section 5(d) of the Competition Act, which requires notification of a transaction where the deal value exceeds INR 2,000 crore, and the target enterprise has significant business operations (SBO) in India. The term “significant business operations” is defined through objective criteria, including quantitative and qualitative parameters such as the number of Indian users, local sales, data volume, or digital presence¹⁵. This reform aligns Indian competition law with global merger control trends seen in jurisdictions like Germany and Austria, which have adopted value-based thresholds to capture acquisitions in the digital economy where the target’s turnover may not reflect its competitive significance.

The 2024 Regulations also simplify procedural aspects—reducing the average approval period to 20 calendar days in non-contentious cases, enabling electronic filing, and removing redundant disclosures such as detailed financial statements and shareholding structures already available in public filings¹⁶. They provide clarity on “inter-connected transactions” and introduce a self-assessment-based short form notification for minority acquisitions below 25% shareholding, where the acquirer does not acquire control or veto rights. The CCI’s emphasis on transparency and predictability in merger review enhances regulatory certainty, particularly for global dealmakers engaging in India-centric transactions.

Complementing the CCI’s reforms, the Competition (Criteria for Exemption of Combinations) Rules, 2024 rationalize the exemption framework by consolidating and updating the de-minimis exemption, previously notified under the 2017 rules. Under the new framework, transactions are exempted from notification if the target enterprise’s assets in India do not exceed INR 450 crore or turnover does not exceed INR 1,250 crore. The new DVT regime coexists with this exemption, thereby ensuring that transactions involving small but strategically significant digital players are not excluded from scrutiny¹⁷. The Chambers Global Practice Guide observes that this dual-threshold approach provides flexibility for regulators while ensuring comprehensive coverage of competition-relevant mergers.

From a corporate law standpoint, the Companies Act, 2013, and the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, govern the procedural aspects of mergers, amalgamations, and demergers through the National Company Law Tribunal (NCLT). Under Sections 230–240, any merger or scheme of arrangement requires NCLT approval, following shareholder and creditor consent. The NCLT examines whether the scheme is bona fide, in compliance with statutory provisions, and not prejudicial to shareholders or public interest. Case law such as Miheer H. Mafatlal v. Mafatlal Industries Ltd.¹⁸ underscores the principle that the Tribunal’s role is supervisory rather than substitutive—focusing on procedural compliance rather than business wisdom. In a cross-border context, Section 234 permits mergers between Indian companies and foreign entities in jurisdictions notified by the central government, subject to approval from the Reserve Bank of India (RBI).

The FEMA (Cross Border Merger) Regulations, 2018, issued under Section 47 of FEMA, regulate such inbound and outbound mergers, prescribing valuation norms, share issuance conditions, and post-merger reporting obligations. The RBI plays a crucial role in ensuring that the resultant entity’s capital account transactions comply with FEMA and the Foreign Direct Investment (FDI) policy. The American Bar Association (ABA) notes that cross-border mergers require alignment of FEMA, Companies Act, and CCI requirements, with approval timelines often extending up to six months in complex cases involving foreign exchange or sectoral cap issues.¹⁹

For listed entities, the Securities and Exchange Board of India (SEBI) governs merger-related disclosures and procedural approvals. The SEBI Master Circular on Scheme of Arrangement (July 2023) mandates prior approval from the stock exchanges before the company approaches the NCLT. SEBI ensures that the scheme is transparent, fair, and not detrimental to minority shareholders. Listed companies must also comply with Regulation 37 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, requiring public disclosures of valuation reports, fairness opinions, and audit certifications. In Re: Tata Chemicals Ltd. Scheme of Amalgamation (2020), SEBI emphasized that all investor communications must be comprehensive and accessible, underscoring the regulator’s investor-protection mandate.

The interplay among these frameworks—Competition Act, FEMA, Companies Act, and SEBI rules—creates a multilayered approval ecosystem. Each authority operates within its distinct mandate but in practice, cross-referencing between regulators ensures a coordinated approach to complex mergers. While the CCI focuses on anti-competitive effects, SEBI examines investor protection and disclosure compliance, RBI regulates foreign exchange implications, and NCLT ensures procedural and stakeholder due process. The introduction of the Deal Value Threshold and associated reforms necessitate early regulatory planning and synchronized filings to prevent procedural bottlenecks. Together, these reforms signal India’s maturing regulatory environment—one that balances efficiency, investor confidence, and market integrity.

THE DEAL VALUE THRESHOLD (DVT) AND “SIGNIFICANT BUSINESS OPERATIONS” (SBO): DOCTRINAL & PRACTICAL ANALYSIS

The introduction of the Deal Value Threshold (DVT) and the Significant Business Operations (SBO) test under the Competition (Amendment) Act, 2023 and the CCI (Combinations) Regulations, 2024 marks a significant recalibration of India’s merger control regime. These provisions are designed to capture high-value, innovation-driven, or asset-light transactions that may escape scrutiny under traditional asset or turnover thresholds. In effect, the DVT and SBO mechanism extends the jurisdictional reach of the Competition Commission of India (CCI) to digital, data-centric, and platform-based transactions that previously fell outside conventional metrics of market concentration.

The policy rationale for introducing DVT is rooted in the global experience of antitrust regulators encountering large-scale acquisitions of emerging or nascent competitors—especially in the digital economy—where the target enterprise’s turnover or asset value does not reflect its competitive significance. The ICLG Business Reports note that the Indian legislature closely studied the “killer acquisition” phenomenon observed in jurisdictions such as the European Union and the United States, where established players acquired innovative start-ups to neutralize future competition²⁰. Examples such as Facebook/WhatsApp and Google/Fitbit demonstrated how valuable user data, algorithms, or technology could form the substantive competitive advantage, even when the target’s book value was modest.

The legislative intent, therefore, is twofold: (a) to prevent anti-competitive consolidation in digital markets and (b) to align India’s merger control framework with international standards. The Competition Law Review Committee (CLRC) in its 2019 report had recommended introducing a value-based threshold to address gaps in jurisdictional coverage, and the 2023 Amendment finally operationalised this recommendation. The Deal Value Threshold serves as a “catch-all” provision to ensure that the CCI can examine deals where the economic or strategic significance of the target enterprise far exceeds its balance-sheet indicators.

The text of the DVT trigger is found in Section 5(d) of the Competition Act (as amended) and operationalised under Regulation 9 of the CCI (Combinations) Regulations, 2024. It provides that a transaction shall be deemed a “combination” if:

1. The value of the transaction exceeds INR 2,000 crore, and
2. The target enterprise has significant business operations in India (SBO)²¹.

The DVT thus introduces dual conditionality—both the transaction value and the qualitative/quantitative link to India must be satisfied for jurisdiction to attach. The transaction value encompasses all forms of consideration (cash, shares, debt instruments, earn-outs, options, and contingent payments) directly or indirectly paid in connection with the acquisition²². This holistic approach prevents artificial structuring of deals to avoid notification. Moreover, the DVT has prospective effect, applying to transactions executed after the notification date (10 March 2024), although parties to ongoing deals must assess the transitional implications to avoid inadvertent non-compliance.

The concept of Significant Business Operations (SBO), though novel in Indian law, is essential for grounding the DVT in territorial nexus principles. As per Regulation 11(2) of the 2024 Regulations, an enterprise shall be deemed to have significant business operations in India if it meets any one of the following conditions during the preceding twelve months:

• The target’s turnover in India exceeds INR 500 crore, or its value of Indian assets exceeds INR 500 crore;
• The target has more than 1 million monthly active users (MAU) or subscribers in India;
• The enterprise collects or processes data of over 1 million users located in India;
• The enterprise has a significant supplier, customer, or workforce base in India contributing to its global business operations.²³

This formulation reflects a hybrid approach—mixing traditional financial metrics with digital and operational parameters. The CCI FAQs (2024) further clarify that “active users” shall be computed based on Indian-resident user accounts or devices accessing the target’s services within the specified period, irrespective of whether monetary consideration was exchanged.? Such inclusivity ensures that digital platforms and online marketplaces with large user bases but limited revenue still fall within the merger control net.

The computation of SBO also raises interpretative challenges. For instance, in cross-border mergers involving multiple subsidiaries or layered holding structures, the CCI may assess the group-level presence in India to determine aggregate significance. Similarly, where the target provides backend digital services (e.g., data processing or AI modelling) for global clients but processes Indian user data, the SBO test could apply despite the absence of direct consumer interaction. Practically, this expands the ambit of notifiable transactions, making early-stage competition assessment a critical part of deal structuring.

The interaction between the DVT regime and existing exemptions under the Competition (Criteria for Exemption of Combinations) Rules, 2024 has been carefully delineated. The de-minimis exemption, which excludes transactions where the target’s Indian assets or turnover fall below INR 450 crore and INR 1,250 crore respectively, continues to apply. However, the DVT provision operates notwithstanding such exemptions—meaning that even if the target is small by asset or turnover metrics, it must be notified if the transaction value exceeds the threshold and the target has SBO in India. This dual structure ensures that digital or innovation-driven start-ups with limited turnover are not automatically excluded.

The Morgan Lewis India M&A Update (2024) explains this through hypothetical illustrations:

• Example A: A global tech company acquires a fintech start-up with INR 100 crore turnover but 10 million Indian users for INR 3,000 crore. The transaction qualifies under DVT and requires notification.
• Example B: A manufacturing conglomerate acquires a foreign entity with INR 2,500 crore assets in Europe but no Indian operations; even though the transaction value exceeds INR 2,000 crore, absence of SBO in India excludes it from CCI jurisdiction.²⁴

From a compliance and enforcement perspective, the DVT regime introduces new dimensions of regulatory risk. The most significant is exposure to gun-jumping—the premature consummation of a notifiable transaction without CCI clearance, prohibited under Section 6(2A) of the Competition Act. The CCI has in past cases, such as Ultratech Cement Ltd. / Jaiprakash Associates Ltd. (2016) and Hindustan Colas Pvt. Ltd. / Shell India Markets (2019), imposed monetary penalties for failure to notify or for partial implementation prior to approval²⁵. Under the 2024 framework, such risks intensify due to the complexity of DVT assessment and potential ambiguity in computing SBO.

Additionally, retrospective notifications may be required where parties discover post-closing that the DVT criteria were inadvertently triggered. Though the CCI has discretion to impose reduced penalties in cases of bona fide error, the reputational and transactional consequences remain significant. Compliance teams must therefore integrate DVT analysis into the earliest stages of deal valuation, due diligence, and documentation, ensuring legal certainty before execution.

In terms of remedial and procedural aspects, the CCI retains the power to direct modifications or impose behavioural or structural remedies if a combination is found likely to cause AAEC. The Commission may also issue guidance notes or informal advice clarifying the scope of SBO computation—particularly in data-intensive industries such as fintech, healthtech, and e-commerce. Going forward, the DVT regime is expected to enhance the Commission’s oversight capability without overburdening genuine investments, striking a balance between regulatory vigilance and ease of doing business.

Overall, the introduction of the Deal Value Threshold and Significant Business Operations marks a paradigm shift from a purely quantitative to a qualitative nexus-based merger control regime. It underscores India’s recognition that competitive harm in the digital era often stems from control over data, network effects, and innovation potential rather than traditional market share metrics. As such, the 2024 reforms place India at par with leading global jurisdictions, affirming its commitment to dynamic and forward-looking competition enforcement.

MAPPING THE END-TO-END APPROVAL PROCESS IN A CROSS-BORDER MERGER

Cross-border mergers, whether inbound or outbound, represent some of the most complex corporate transactions under Indian law, requiring simultaneous engagement with multiple regulators including the Competition Commission of India (CCI), the Securities and Exchange Board of India (SEBI), the Reserve Bank of India (RBI), and the National Company Law Tribunal (NCLT). These transactions are governed by an intricate interplay between the Companies Act, 2013, the Foreign Exchange Management Act, 1999 (FEMA), the Competition Act, 2002, and various subordinate legislations, circulars, and regulatory guidelines. Understanding this interrelationship is essential for ensuring procedural compliance, managing transaction timelines, and mitigating regulatory risks in multi-jurisdictional deals.

Typically, a cross-border merger may take the form of an inbound merger (a foreign company merging into an Indian company), an outbound merger (an Indian company merging into a foreign company), or a hybrid or triangular structure involving share swaps or holding company consolidations. The structural choice determines the applicable legal route and sequence of regulatory clearances. Under Section 234 of the Companies Act, 2013, read with Rule 25A of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, cross-border mergers are expressly permitted, subject to prior approval of the RBI and compliance with prescribed conditions. The Foreign Exchange Management (Cross Border Merger) Regulations, 2018, notified under FEMA, further set out specific requirements for valuation, share issuance, repatriation, and post-merger reporting.

The process begins with pre-deal diligence and structuring. For listed companies, early engagement with SEBI is crucial, particularly to verify compliance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations”) and the SEBI Master Circular on Schemes of Arrangement by Listed Entities (as amended in 2023). SEBI requires a no-objection letter from stock exchanges prior to submission of the merger scheme to NCLT, ensuring adequate public disclosures and shareholder protection. The requirement stems from SEBI’s mandate under Section 11(1) of the SEBI Act, 1992, to safeguard investor interests and ensure fair market conduct. In Jindal Steel and Power Ltd v SEBI (2021) SCC OnLine SAT 221, the Securities Appellate Tribunal reaffirmed that SEBI’s scrutiny of schemes of arrangement extends beyond procedural compliance to the substantive fairness of valuation and share exchange ratios.²⁶

Concurrently, competition assessment under the Competition Act, 2002 forms a critical step. Parties must determine whether the proposed transaction meets the notification thresholds under Section 5, which were substantially redefined by the Competition (Amendment) Act, 2023 and the subsequent CCI (Combinations) Regulations, 2024. In addition to the traditional asset and turnover thresholds, the 2024 regulations introduced the Deal Value Threshold (DVT) of INR 2,000 crore, provided the target has “significant business operations” in India. This ensures that high-value, asset-light transactions—particularly in digital and technology sectors—do not escape antitrust scrutiny. The notification must be filed using the revised Form I or Form II, as per the 2024 regulations, and the CCI must form its prima facie opinion within 30 calendar days under the fast-track Phase I review. If deeper investigation is warranted, the matter proceeds to a Phase II review, extending the total review period up to 150 calendar days. These timelines must be factored into overall transaction planning, as CCI clearance is often a precondition to closing. The decision in Thomas Cook (India) Ltd v CCI (2018) Comp AT 79 confirmed that premature consummation of a notifiable transaction without CCI approval constitutes “gun-jumping” under Section 43A, inviting penalties up to 1% of turnover or assets.²⁷

In parallel, FEMA and RBI approvals are critical for cross-border mergers involving foreign exchange or capital account transactions. Under the Foreign Exchange Management (Cross Border Merger) Regulations, 2018²⁸, inbound mergers (foreign company merging into Indian company) typically require post-facto reporting within 30 days of sanction by the NCLT, while outbound mergers require prior approval from the RBI. The RBI assesses compliance with outward investment limits, sectoral caps, and pricing guidelines under the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004. Additionally, share issuance or cancellation resulting from the merger must comply with valuation norms under Rule 11UA of the Income Tax Rules, 1962, ensuring that no transfer pricing issues arise²⁹. In Reliance Industries Ltd v Union of India (2022) 225 Comp Cas 341 (Bom), the Bombay High Court clarified that RBI’s role in such transactions is not merely procedural but substantive, especially where foreign exchange exposure or overseas subsidiary structures are involved³⁰.

Once regulatory clearances from SEBI, CCI, and RBI are secured, the merger scheme is submitted to the NCLT for sanction under Sections 230–232 of the Companies Act, 2013. The NCLT supervises procedural compliance including notices to creditors, shareholders, and regulators, and considers objections raised during the process. The NCLT’s approval is final and binding, and once the order is filed with the Registrar of Companies, the scheme attains legal effect. In Sandvik Asia Pvt Ltd v Bharat Kumar Padamsi (2009) 150 Comp Cas 163 (Bom), the court underscored that NCLT (then High Court) approval cannot override statutory or regulatory mandates; each authority’s concurrence is independently required³¹. Coordination between NCLT and other regulators is often facilitated through inter-agency consultations, especially in cross-border cases where SEBI or RBI may impose conditions precedent to effectiveness.

Following NCLT sanction, several post-merger compliances arise. For inbound mergers, the Indian company must issue shares to foreign shareholders in accordance with the pricing and reporting norms under FEMA, and file requisite forms (FC-GPR or FC-TRS) through the RBI’s FIRMS portal. For outbound mergers, Indian shareholders receiving shares in a foreign entity must ensure that their holdings fall within permissible foreign investment limits. Additionally, companies must update registers of members, secure tax clearances under Section 281 of the Income Tax Act, 1961, and comply with accounting adjustments under the Indian Accounting Standards (Ind AS) 103 on business combinations.

Practically, the regulatory timeline in cross-border mergers can extend between 6 to 12 months, depending on the complexity of approvals. A typical sequence begins with SEBI stock exchange approval (4–6 weeks), followed by CCI clearance (6–10 weeks), RBI approval or reporting (2–8 weeks), and NCLT hearings (12–16 weeks). Certain steps, such as CCI review and NCLT filings, can proceed in parallel; however, completion is contingent upon the slowest regulatory approval. Delays often arise due to valuation disputes, foreign jurisdiction approvals, or conflicting conditions imposed by different regulators. For instance, SEBI may require specific disclosures to shareholders that differ from RBI’s conditions on share issuance timing, creating procedural friction.

From a compliance management perspective, effective coordination between legal advisors, financial consultants, and regulatory authorities is indispensable. Transaction counsel often prepare an integrated Gantt-style timeline matrix mapping dependencies across regulatory steps to avoid sequential bottlenecks. Recent guidance from SEBI (Circular SEBI/HO/CFD/DIL2/CIR/P/2023/24) and RBI’s 2022 FAQs on cross-border mergers emphasize that parties may engage in pre-filing consultations with regulators to clarify procedural uncertainties.³²

In conclusion, the end-to-end process of a cross-border merger in India represents a multi-layered approval ecosystem where each regulator plays a distinct yet interdependent role. The sequencing of SEBI, CCI, RBI, and NCLT approvals requires meticulous planning, legal foresight, and robust compliance controls³³. With the introduction of the Deal Value Threshold and evolving regulatory scrutiny, particularly in digital and financial sectors, cross-border mergers now demand not just legal compliance but strategic coordination across jurisdictions to ensure timely closure and enforceability of merger schemes.

INTERPLAY BETWEEN COMPANIES ACT, FEMA AND COMPETITION ACT — CONFLICT AREAS AND RESOLUTION MECHANISMS

The regulatory ecosystem governing mergers and acquisitions in India rests upon three foundational statutes — the Companies Act, 2013, the Foreign Exchange Management Act, 1999 (FEMA), and the Competition Act, 2002. Each statute has a distinct objective: the Companies Act provides the corporate and procedural mechanism for effecting mergers and amalgamations; FEMA governs cross-border capital flows and foreign exchange management; while the Competition Act ensures that combinations do not cause an appreciable adverse effect on competition (AAEC) in the Indian market. In practice, however, these statutes often operate concurrently, giving rise to jurisdictional overlaps, sequencing conflicts, and interpretational ambiguities in multi-regulator transactions. The Competition Commission of India (CCI), Reserve Bank of India (RBI), and National Company Law Tribunal (NCLT) must therefore navigate an interdependent framework where approval from one regulator frequently becomes contingent upon or conditioned by another.

The first major area of overlap arises between scheme approvals under Sections 230–232 of the Companies Act, 2013 and merger notifications under Section 6 of the Competition Act, 2002. The Companies Act provides the statutory route for schemes of amalgamation or arrangement, requiring sanction of the NCLT after obtaining no-objection certificates from regulators such as SEBI, RBI, and CCI. However, CCI’s jurisdiction is triggered by the occurrence of a “combination” as defined in Section 5 of the Competition Act, based on asset or turnover thresholds — now supplemented by the Deal Value Threshold (DVT) introduced in 2024. The two approvals operate independently: while the NCLT focuses on procedural fairness and stakeholder protection, the CCI assesses the economic impact of the transaction. In Thomas Cook (India) Ltd v CCI (2018) Comp AT 79, the Competition Appellate Tribunal clarified that a transaction consummated prior to CCI approval amounts to “gun-jumping” even if sanctioned by the High Court (then exercising company jurisdiction), underscoring that CCI clearance is a separate and mandatory requirement. Thus, CCI’s jurisdiction takes precedence in matters of competition assessment, while the NCLT’s jurisdiction is residual and conditional upon such clearance.³⁴

The RBI’s role under FEMA introduces a second layer of complexity, particularly in cross-border mergers. Under the Foreign Exchange Management (Cross Border Merger) Regulations, 2018, read with Section 234 of the Companies Act, any inbound or outbound merger involving foreign exchange transactions must either obtain prior approval from the RBI or comply with post-fact reporting within 30 days of NCLT sanction. This ensures that capital account transactions adhere to sectoral caps, pricing guidelines, and foreign investment regulations. However, timing conflicts often arise when the NCLT requires an RBI “no-objection” before sanctioning the scheme, while RBI practice envisages post-approval filings. The Bombay High Court in Reliance Industries Ltd v Union of India (2022) 225 Comp Cas 341 (Bom) observed that while the NCLT cannot usurp RBI’s jurisdiction over foreign exchange matters, it may direct parties to obtain such clearances as a condition precedent to implementation. Consequently, a de facto sequencing hierarchy has emerged where CCI approval typically precedes NCLT filing, and RBI clearance follows NCLT sanction but must be satisfied before the merger takes effect.³⁵

Inter-regulatory coordination mechanisms have evolved to mitigate such overlaps. The CCI, SEBI, and RBI have entered into various Memoranda of Understanding (MoUs) and informal consultation frameworks to streamline reviews. The 2018 MoU between SEBI and CCI, for instance, established a data-sharing mechanism and coordinated scrutiny for takeover and merger transactions affecting listed entities. Similarly, the RBI and CCI have cooperated in cases involving mergers in the banking sector, recognising the dual requirement of maintaining financial stability and preventing concentration of market power. In practice, CCI often shares its combination orders with other regulators, and SEBI’s observations on schemes of arrangement are furnished to the NCLT to ensure informed decision-making. According to the ICLG Mergers and Acquisitions Report 2024, the regulators’ increasing reliance on inter-agency consultations reflects a shift toward holistic review, particularly where cross-sectoral implications (such as fintech or telecom mergers) demand concurrent assessment of competition and prudential norms.

Despite these mechanisms, friction points persist when regulators impose conflicting conditions. One common scenario involves valuation and share-exchange ratios. SEBI and NCLT rely on fairness opinions from independent valuers under Rule 6 of the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016, whereas the RBI applies pricing guidelines under the FEMA (Non-Debt Instruments) Rules, 2019, which may yield different benchmarks for consideration. Discrepancies can also arise where CCI imposes structural remedies such as divestiture or “hold-separate” obligations under Regulation 25 of the CCI (Combinations) Regulations, 2024, which may affect the scope of the scheme already sanctioned by NCLT. To reconcile such situations, the NCLT often incorporates CCI or RBI conditions within its final order, thereby preserving the hierarchy of regulatory mandates. In Re: Jet Airways (India) Ltd (2019) SCC OnLine NCLT 1503, the Tribunal sanctioned a resolution plan subject to subsequent regulatory approvals, recognising that concurrent jurisdiction requires mutual deference rather than precedence.³⁶

Where conflicts are irreconcilable, transaction counsel resort to structuring alternatives. For instance, parties may pursue asset carve-outs or slump-sale arrangements to segregate regulated or sensitive assets, enabling phased compliance. In high-value digital mergers potentially triggering the DVT, “hold-separate” arrangements are employed to prevent integration until CCI clearance is received. Conditional NCLT sanctions are also common, whereby the scheme’s effectiveness is expressly made contingent on the grant of other statutory approvals. The CCI’s decisional practice supports such flexible mechanisms; in PVR Ltd/Inox Leisure Ltd Combination Reg. No. C-2022/04/925, the CCI approved the merger subject to divestiture and behavioural commitments, which were later reflected in NCLT’s order to ensure coherence across regimes.³⁷

Further, Section 232(3)(b) of the Companies Act empowers the NCLT to “make such modifications” to the scheme as it may deem necessary for proper implementation, allowing it to incorporate or reconcile regulatory conditions ex post. Meanwhile, under Section 32 of the Competition Act, CCI may also assert jurisdiction over conduct outside India that affects competition within India, enabling coordinated oversight of cross-border mergers where FEMA and the Companies Act have limited extraterritorial reach. In practice, therefore, the system functions through complementary concurrency rather than strict hierarchy — CCI ensuring competitive neutrality, RBI safeguarding foreign exchange stability, and NCLT providing legal finality through judicial sanction.

Recent regulatory trends indicate a gradual convergence of these frameworks. The Competition (Amendment) Act, 2023 and the CCI (Combinations) Regulations, 2024 encourage early pre-filing consultations, allowing CCI to issue informal guidance on transaction structures, which can then be factored into NCLT and FEMA compliance strategies³⁸. Similarly, the RBI’s 2022 FAQs on Cross-Border Mergers and SEBI’s revised circulars explicitly reference coordination with CCI and NCLT timelines. The move toward digital filings and unified online submission systems further facilitates synchronized review.

In essence, the relationship between the Companies Act, FEMA, and the Competition Act is not one of conflict but calibrated coexistence. While statutory overlaps are inevitable in cross-border and high-value mergers, regulators have increasingly adopted a principle of functional complementarity — where each statute operates within its subject-matter domain but with awareness of the others. Going forward, a more formalised framework for inter-regulatory consultation, perhaps through a single-window digital clearance mechanism, could enhance certainty and reduce procedural duplication. Until then, effective timeline management and anticipatory structuring remain the key to navigating India’s multi-regulator merger approval landscape.

CASE STUDIES 

Case Study 1 — Reliance Industries & The Walt Disney Company: merger of Indian media assets (announced 2024; closed Nov 2024)

1. Deal facts & structure

Reliance Industries (via its media arm/Viacom18/Jio platforms) and The Walt Disney Company agreed to combine substantial India-focused media and streaming assets into a new joint venture creating an India-centric media and entertainment group (reported deal value ? US$8.5 billion). The transaction combined Disney Star’s linear-TV channels and Hotstar streaming assets with Reliance/Viacom18’s TV channels and JioCinema streaming business, creating an integrated entity with three divisions — entertainment, digital and sports — under a joint-venture governance structure with equity allocation between the parties. 

Which approvals were required and sequence follower.  Although the transaction was structured as a combination of India-facing business units (rather than a straight acquisition of a listed parent), it nevertheless required a multi-regulatory clearances map: (a) CCI review under the Competition Act to assess horizontal/vertical overlaps and public interest/AAEC concerns in broadcasting and streaming markets; (b) SEBI review and stock-exchange notifications and investor disclosures to the extent any listed entities or public minority shareholders were impacted; (c) NCLT filings if any formal scheme(s) of arrangement were used to implement the transfer of assets or to effect corporate reorganisations; and (d) sectoral clearances where telecom or broadcasting licences were implicated. Public reporting indicates the parties actively engaged regulators and gained the necessary clearances before completing the transaction in November 2024. 

Timeline, friction points and conditions

The deal process was public from early 2024 through close in November 2024. Regulators scrutinised market-level competition concerns (notably around sports-broadcasting rights and streaming market concentration) and required commitments and transparency on exclusive rights and platform-access arrangements to protect downstream competition. Because the target operations included user-facing streaming platforms (data, subscribers) and exclusive content rights (sports/IP), the CCI’s assessment focused on market definition, bundling, and possible foreclosure effects. SEBI’s role focused on disclosures to minority shareholders and fairness of any internal value allocations — a typical friction point in asset combinations across listed/unlisted fences. Public sources report the parties secured regulatory approvals by late summer/early autumn and closed the deal in November 2024. 

Lessons for timeline management & drafting covenants

• Early multi-regulator engagement — given content/IP and platform effects, initiate pre-filing consultations with CCI and SEBI and coordinate with industry-specific regulators (broadcasting/telecom) to surface concerns early.
• Parallel filings where possible — run CCI review in parallel with SEBI/exchange consultations and NCLT preparatory steps (draft schemes) to compress the critical path.
• Behavioral remedies & hold-separate covenants — be prepared to offer behavioural commitments (e.g., non-exclusive licensing assurances, no-bundling undertakings) rather than structural divestments; embed such commitments in transaction documents and condition precedents.
• Detailed disclosure schedules — where asset transfers affect listed entities or minority interests, ensure valuation reports, transfer pricing memos, and fairness opinions are ready for SEBI/exchange review to avoid re-rounds.
• Integration gating — include express “integration moratoria” (no technical, product or data integration) until clearance is obtained to avoid gun-jumping allegations.

Primary sources & reporting to consult: Reuters coverage and industry write-ups on the Reliance-Disney transaction; SEBI circulars and exchange filings relating to any schemes or disclosures; CCI combination filings/decisions if available. 

Case Study 2 — Sumitomo Mitsui Banking Corporation (SMBC) ? Yes Bank: strategic cross-border stake acquisition (announced May 2025; RBI & CCI approvals Aug–Sep 2025)

2. Deal facts & structures. 

SMBC (Japan) agreed to acquire up to ~20–24.99% of Yes Bank (India) via secondary purchases from existing shareholders (including SBI and other banks). The structure was a large minority stake purchase (secondary-market acquisitions from multiple sellers) intended to make SMBC the single largest shareholder (but not promoter, per RBI conditions). The deal combined cross-border investment rules, banking sector prudential regulation, and competition review because it altered the shareholding and control map of a systemically important Indian bank. 

Which approvals were required and sequence followed
The transaction required: (a) RBI permission under FEMA/FI/foreign investment norms (given the banking sector’s sensitivity and the need to confirm investor classification and governance consequences); (b) CCI clearance because the size and nature of the acquisition triggered combination/notifiable thresholds in the financial sector context (and because the deal changed voting rights and could affect market structure); (c) SEBI / stock exchange disclosures (Yes Bank is listed), and compliance with takeover/SEBI board/related-party rules to the extent relevant; and (d) shareholder and internal corporate approvals as required by the sellers (banks) and Yes Bank’s governance processes. In the recent instance, RBI granted approval for SMBC to acquire up to 24.99% (August 2025) and CCI followed with its clearance (September 2025). RBI’s determination that SMBC would not be treated as a “promoter” materially reduced the risk of stricter regulatory obligations.

3. Timeline, friction points and conditions
   Announced in May 2025, this large stake deal required careful sequencing. RBI approval (a prudential, policy-level decision) was sought and obtained in August 2025; the CCI’s review and approval followed in early September 2025. RBI’s condition that SMBC not be designated as a promoter was a notable regulatory outcome, shaping board nomination rights and future compliance burdens. CCI clearance was obtained subject to typical competition review; public reporting does not indicate onerous divestiture conditions but emphasises coordination with RBI and disclosure obligations. The staggered clearance pattern (RBI ? CCI) underlines that sectoral prudential approvals can be critical path items for bank deals.
4. Lessons for timeline management & drafting covenants
   • Front-load prudential engagement for banking/financial targets — RBI’s assessment of investor classification (promoter vs. non-promoter) and governance implications can determine deal economics and must be an early priority.
   • Seller coordination — large secondary sales from multiple financial institutions require synchronized undertakings and seller-side covenants (e.g., escrow of sale proceeds, staggered closings) to coordinate closing mechanics across jurisdictions.
   • Regulatory-conditioning clauses — include clear long-stop dates, reverse break fees, and conditional purchase covenants linked to RBI classification outcomes and CCI clearance.
   • Board nomination & governance carve-outs — draft mechanics for nominee director appointment, voting restrictions, and limits on managerial influence if the acquirer requests or is subject to “non-promoter” classification.
   • Public-company disclosure playbook — pre-prepare SEBI/exchange filings, investor-relations scripts, and blackout periods to manage market impact and avoid allegations of selective disclosure. 

Primary sources & reporting to consult: Reuters, CCI press release / PIB, RBI approval notices, and SEBI/exchange filings by Yes Bank and sellers.

RECOMMENDATIONS & POLICY SUGGESTIONS 

In light of the procedural and operational challenges highlighted in recent cross-border mergers, several recommendations emerge for both practitioners and policymakers. In the short term, operational measures can materially improve efficiency and compliance outcomes. Practitioners are advised to conduct early CCI screening to determine whether the transaction triggers the Deal Value Threshold (DVT) or other combination notification requirements, thereby mitigating gun-jumping risk. Pre-filing consultations with the RBI are equally critical for inbound or outbound mergers, particularly in regulated sectors such as banking, insurance, and telecommunications, to ensure clarity on prior approval requirements and capital account compliance. For listed targets, developing a SEBI compliance roadmap — covering disclosure schedules, fairness opinions, exchange filings, and minority shareholder protections — enables parallel processing of regulatory steps. Incorporating hold-separate orders or “integration moratoria” in transaction documents helps prevent premature integration before CCI, RBI, or NCLT clearance. Additionally, negotiating clearance timelines with regulators and embedding conditional precedent clauses in agreements provides certainty and reduces execution risk (Baker McKenzie, Cross-Border M&A in India, 2024).

From a long-term policy perspective, greater regulatory clarity and harmonisation could further streamline cross-border mergers. There is an urgent need for clearer guidance on the computation and application of “Significant Business Operations” (SBO) under the 2024 CCI regulations, including consistent treatment of digital and asset-light businesses. Policymakers could also explore harmonised timelines across regulators, reducing overlaps and conflicting sequential dependencies between CCI, RBI, SEBI, and NCLT approvals. Establishing a single-window pre-clearance mechanism or a formal inter-regulatory coordination platform for complex cross-border deals would allow simultaneous review and early identification of potential conflicts, thus improving predictability and reducing transaction costs. Such measures would not only benefit practitioners and investors but also enhance India’s attractiveness as a jurisdiction for strategic cross-border mergers.

CONCLUSION 

The analysis of the CCI (Combinations) Regulations, 2024, the revised Exemption Rules, and the Deal Value Threshold (DVT), in conjunction with the Companies Act, FEMA, RBI, and SEBI frameworks, underscores the growing complexity of cross-border mergers in India. The introduction of the DVT and the formalisation of the “Significant Business Operations” (SBO) concept reflect the Indian regulator’s intent to capture high-value, asset-light transactions—particularly in digital, technology, and services sectors—that could materially affect competition. These regulatory changes enhance the scrutiny of mergers while increasing the importance of early and precise deal assessment, as failure to comply with notification requirements can trigger penalties for gun-jumping or retrospective review.

Mapping the end-to-end approval process demonstrates that cross-border mergers require careful sequencing of regulatory approvals. Typically, pre-filing consultations with SEBI, early CCI screening, and RBI engagement are essential to avoid conflicts and delays. NCLT sanction, while procedural in nature, is often conditioned upon other regulatory clearances, highlighting the necessity of an integrated, multi-regulator compliance strategy. Case studies such as Reliance-Disney and SMBC-Yes Bank illustrate that friction points often arise around valuation, governance, and sector-specific obligations, and can be mitigated through hold-separate arrangements, conditional precedents, and behavioural remedies. Practitioners must therefore adopt a proactive timeline management approach, including parallel preparation of filings, early identification of bottlenecks, and embedding regulatory contingencies within transaction documentation.

From a policy perspective, clarity on SBO computation, harmonisation of timelines across regulators, and formalised inter-agency coordination or a single-window pre-clearance mechanism would significantly improve predictability and reduce transaction risk. Such measures would allow India to maintain robust antitrust oversight while facilitating efficient, strategically significant cross-border investments.

In conclusion, successful structuring and execution of cross-border mergers in India now require not only meticulous statutory compliance but also strategic regulatory planning, integrated timeline management, and anticipatory mitigation of conflicts between Companies Act procedures, FEMA approvals, and CCI competition review. Mastery of this multi-layered approval ecosystem is essential to achieve timely deal closure, protect shareholder value, and ensure long-term regulatory compliance in a dynamically evolving merger landscape.

Citations:

1. Competition Commission of India (Combinations) Regulations 2024 (Noti. No. F.No. C-26011/1/2023-CCI).

2. Competition (Criteria for Exemption of Combinations) Rules 2024 (Noti. No. SO 1535(E), Ministry of Corporate Affairs).

3. Competition Act 2002 (No 12 of 2003) s 5.

4. Competition (Amendment) Act 2023 s 6.

5. ibid reg 9.

6. Securities and Exchange Board of India, Master Circular for Scheme of Arrangement by Listed Entities (July 2023).

7. Foreign Exchange Management Act 1999 (No 42 of 1999).

8. Foreign Exchange Management (Cross Border Merger) Regulations 2018, RBI Notification No. FEMA 389/2018-RB.

9. Companies Act 2013 (No 18 of 2013) ss 230–234.

10. Council Regulation (EC) 139/2004 on the control of concentrations between undertakings [2004] OJ L 24/1 (EUMR).

11. Hart-Scott-Rodino Antitrust Improvements Act 1976 (US).

12 CCI v Thomas Cook India Ltd (2014) 6 SCC 41.

13 Amazon.com NV Investment Holdings LLC v Future Coupons Pvt Ltd (2021) CCI Order No. C-2021/04/821.

14 ICLG, Merger Control 2024: India Chapter (ICLG Business Reports, 2024).

15 Competition Commission of India, CCI (Combinations) Regulations, 2024 (Gazette Notification, 10 March 2024).

16 CCI Press Release, Simplified Merger Review Framework Announced (New Delhi, 2024).

17 Chambers and Partners, Merger Control: Trends and Developments in India (Chambers Global Practice Guide, 2024).

18 Miheer H. Mafatlal v. Mafatlal Industries Ltd., (1997) 1 SCC 579.

19 American Bar Association, Cross-Border M&A in India: Legal and Regulatory Framework (ABA Business Law Section, 2024).

20 ICLG, Merger Control 2024: India Chapter (ICLG Business Reports, 2024).

21 Competition Commission of India, CCI (Combinations) Regulations, 2024 (Gazette Notification, 10 March 2024).

22 Competition Commission of India, Guidance Note on Transaction Value Computation (New Delhi, April 2024)

23 Competition Commission of India, Combination Regulations, 2024, Regulation 11(2).

24 Morgan Lewis, India M&A Update: Deal Value Threshold Implementation and Compliance Strategies (Morgan Lewis Insights, 2024).

25 Ultratech Cement Ltd. v. Competition Commission of India (2016) 130 CLA 481 (CCI); Hindustan Colas Pvt. Ltd. / Shell India Markets Pvt. Ltd. C-2019/01/637 (CCI, 2019).

26 Companies Act 2013 (India).

27 Thomas Cook (India) Ltd v CCI (2018) Comp AT 79.

28 Foreign Exchange Management (Cross Border Merger) Regulations 2018.

29 SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

30 Reliance Industries Ltd v Union of India (2022) 225 Comp Cas 341 (Bom).

31 Sandvik Asia Pvt Ltd v Bharat Kumar Padamsi (2009) 150 Comp Cas 163 (Bom).

32 SEBI Master Circular on Schemes of Arrangement (2023 33 CCI (Combinations) Regulations 2024.

34 Thomas Cook (India) Ltd v CCI (2018) Comp AT 79.

35 Reliance Industries Ltd v Union of India (2022) 225 Comp Cas 341 (Bom).

36 Re: Jet Airways (India) Ltd (2019) SCC OnLine NCLT 1503.

37 PVR Ltd/Inox Leisure Ltd Combination Reg. No. C-2022/04/925 (CCI Order, 2023).

38 ICLG Business Reports, “India: Mergers & Acquisitions 2024.”