INDIA Law and Practice Contributed by: Anshuman Sakle, Anisha Chand, Pranjal Prateek and Soham Banerjee, Khaitan & Co
by the CCI in its inquiry is provided in 4.1 Substan- tive Test . 4.5 Economic Efficiencies The CCI considers economic efficiencies in its assess - ment. As set out in 4.1 Substantive Test , the CCI con - siders a host of factors in its assessment, including economic efficiencies (forming part of pro-competitive factors). 4.6 Non-Competition Issues The CCI regularly considers non-competition issues (such as industrial policy, regulatory frameworks, gov - ernment policies and market evolution) whilst assess - ing a transaction. Rules for foreign direct investment / foreign subsidies are entirely distinct from the Indian merger control regime. The broad-based legislative framework surrounding foreign direct investment/for - eign subsidies is set out in 1.2 Legislation Relating to Particular Sectors . 4.7 Special Consideration for Joint Ventures There are no special considerations in the substantive review of joint ventures. That said, concerns regard - ing (i) co-ordination between joint venture parents and (ii) access to commercially sensitive information are closely scrutinised by the CCI. Concerns are typically mitigated by: • incorporating relevant ring-fencing mechanisms (in line with applicable law); and • creating clean-teams (comprising members not involved in any day-to-day management of the entity or those not having access to commercially sensitive information), amongst others. 5. Decision: Prohibitions and Remedies 5.1 Authorities’ Ability to Prohibit or Interfere With Transactions The CCI is empowered to: • approve a transaction unconditionally; • approve a transaction subject to modifications; or • block/prohibit a transaction outright.
able remedy package to assuage competitive con - cerns and provide a conditional approval. However, if a suitable remedy package cannot be arrived at, the CCI may block the transaction. Notably, since the formal commencement of the Indi - an merger control regime, the CCI has never blocked a transaction. 4.2 Markets Affected by a Transaction In assessing the competitive impact of a transaction, the CCI requires the parties to first identify all of their respective affiliates (and their business activities), and from there to map all horizontal overlaps, vertical relationships (whether actual or potential) and com - plementary linkages. For each overlap, relationship or linkage identified, the parties must set out the relevant markets in which they are active and define each mar - ket on both broad and narrow bases. The competitive assessment is then carried out sepa - rately for each relevant market in the case of a hori - zontal overlap, and for each relevant market pair in the case of vertical relationships and complementary linkages. The Indian merger control regime does not prescribe any de minimis threshold, whether by market share or otherwise, that allows parties to disregard an overlap The CCI has built a substantial body of decisional practice over the last decade. Parties can rely on CCI precedent in comparable markets for persuasive val - ue, and on decisions from mature jurisdictions, such as the EU, the UK and the US, where no CCI prec - edent exists. That said, the CCI always conducts an independent, fact-specific assessment of the com - petitive conditions in the relevant market, and is not bound by any precedent, domestic or foreign. 4.4 Competition Concerns A detailed list of factors (which are indicative of uni - lateral effects, co-ordinated effects, conglomerate effects, vertical concerns, foreclosure concerns and elimination of potential competition) typically relied on or the resulting relevant markets. 4.3 Reliance on Case Law
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