Merger control under Indian competition law is the regulatory framework requiring mandatory pre-notification of acquisitions, mergers, and amalgamations that cross specified asset or turnover thresholds to the Competition Commission of India, which reviews whether the combination would cause an appreciable adverse effect on competition. Under Indian law, merger control is governed by Sections 5 and 6 of the Competition Act, 2002, which define "combination" by reference to monetary thresholds and prohibit any combination that is likely to cause an appreciable adverse effect on competition (AAEC) in the relevant market in India.
Legal definition
The Competition Act, 2002 establishes the merger control framework:
Section 5: Defines "combination" through asset and turnover thresholds at three levels: (a) the acquiring enterprise alone; (b) the acquiring enterprise and the target enterprise jointly; and (c) the group to which the enterprise belongs. The current thresholds (as amended by notification) are: assets exceeding Rs 2,500 crore or turnover exceeding Rs 7,500 crore for the parties jointly in India, or assets exceeding $1.25 billion or turnover exceeding $3.75 billion worldwide (with India-specific thresholds of Rs 1,000 crore assets or Rs 3,000 crore turnover).
Section 6(1): "No person or enterprise shall enter into a combination which causes or is likely to cause an appreciable adverse effect on competition within the relevant market in India and such a combination shall be void."
Section 6(2): "Any person or enterprise, who or which proposes to enter into a combination, shall give notice to the Commission, in the form as may be specified, and the fee which may be determined, by regulations, disclosing the details of the proposed combination, within thirty days of... approval of the proposal relating to merger or amalgamation, or execution of any agreement or other document for an acquisition."
The Competition (Amendment) Act, 2023 introduced an additional "deal value threshold" — a combination must be notified if the value of the transaction exceeds Rs 2,000 crore and the target enterprise has "substantial business operations in India."
How courts have interpreted this term
CCI v. Steel Authority of India Ltd. [(2010) 10 SCC 744]
While primarily addressing the CCI's general powers, the Supreme Court affirmed the CCI's jurisdiction to review combinations and impose conditions on mergers that may affect competition. The Court upheld the CCI's authority to pass interim orders during the review of combinations.
Ultratech Cement Ltd. v. CCI [2018 CompAT]
The Competition Appellate Tribunal (now NCLAT) examined the CCI's power to modify or impose conditions on approved combinations. The Tribunal upheld the CCI's authority to approve combinations subject to conditions (such as divestiture of assets, behavioural commitments, or ring-fencing arrangements) to mitigate the adverse competitive effects.
Types of combinations under the Competition Act
Section 5 covers three forms of combinations:
- Acquisitions: Acquisition of shares, voting rights, or assets of an enterprise where the acquiring entity (directly or through subsidiaries) acquires control over the target — including acquiring more than 25% of shares or voting rights, or control over the management or affairs
- Mergers and amalgamations: Merger or amalgamation of two or more enterprises, pursuant to schemes of arrangement under the Companies Act, 2013 or by mutual agreement
- Joint ventures: Acquisition of joint control over an enterprise, resulting in a new entity or arrangement that meets the threshold criteria
Why this matters
India's merger control regime is a mandatory, suspensory system — combinations exceeding the prescribed thresholds must be notified to the CCI and cannot be consummated until the CCI approves or the 210-day review period (formerly 210 working days, now 150 calendar days post-2023 Amendment) expires. The CCI can approve a combination unconditionally, approve with conditions (modifications), or reject it.
For businesses planning mergers and acquisitions, understanding the notification thresholds is essential. The "Green Channel" route (introduced in 2019) allows automatic approval for combinations where there are no horizontal, vertical, or complementary overlaps between the parties. Green Channel filings are deemed approved upon filing, significantly reducing deal timelines.
For practitioners, the key substantive test is whether the combination is likely to cause an appreciable adverse effect on competition (AAEC) in the relevant market. The CCI assesses factors including: actual and potential competition, barriers to entry, the degree of countervailing power of buyers, market shares and concentration levels, and the likelihood of the combination being used to substantially prevent competition. Most combination reviews in India (over 95%) result in unconditional approval, with only a small percentage requiring modifications or being rejected.
Related terms
Parent legislation:
Sibling prohibitions:
Related regulators:
Frequently asked questions
When must a merger or acquisition be notified to the CCI?
Notification is mandatory when the parties to the combination (individually or jointly) exceed the asset and turnover thresholds prescribed under Section 5, or when the deal value exceeds Rs 2,000 crore (under the 2023 Amendment). The notification must be filed within 30 days of the board approval, execution of the binding agreement, or the acquisition of shares/voting rights, whichever is applicable.
How long does the CCI take to review a combination?
The CCI aims to complete its review within 150 calendar days (post-2023 Amendment) from the date of the notice. In practice, straightforward combinations are approved within 30-45 days (Phase I review). Complex cases requiring detailed investigation enter Phase II, which can take the full 150 days. Green Channel filings are deemed approved immediately upon filing.
What happens if a combination is consummated without CCI approval?
Under Section 43A, a person or enterprise that fails to notify a combination that requires notification is liable to a penalty of up to 1% of the total turnover or total assets, whichever is higher, of the combination. Additionally, the CCI may direct the division of the combination or the divestiture of assets if the consummated combination is found to have an AAEC.
This entry is part of the Veritect Indian Legal Glossary, a comprehensive reference of Indian legal terminology grounded in statutory text and judicial interpretation.
Last updated: 2026-03-27. Veritect provides this content for informational purposes and does not constitute legal advice.