TaxTMI 
TaxTMI 
The Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011
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....se requires:- (a) "Act" means the Competition Act, 2002 (12 of 2003) as amended from time to time; (b) "Combination" means and includes combination as described in section 5 of the Act and any reference to combination in these regulations shall mean a proposed combination or the combined entity, if the combination has come into effect, as the case may be; (c) "Commission" means the Competition Commission of India established under subsection (1) of section 7 of the Act; (d) "Director General" means the Director General appointed under sub-section (1) of section 16 of the Act and includes any Additional, Joint, Deputy or Assistant Directors General appointed under the said section; (e) "Enterprise" shall mean "enterprise" as defined in clause (h) of section 2 of the Act; (f) "Parties to the combination" means persons or enterprises entering into the combination and shall include the combined entity if the combination has come into effect; (g) "Secretary" means the Secretary appointed under sub-section (1) of section 17 of the Act and includes an officer of the Commission authorized by the Chairperson to function as Secretary. (2) For the purposes of these regulations,....
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....e predominantly engaged in exports of goods or services from India and continue to be predominantly engaged in exports of goods or services from India after the combination takes effect: Provided that the market share of the combined entity is less than fifteen percent (15%) in the relevant market in India. Explanation: A party to the combination shall be deemed to be predominantly engaged in export of goods or services from India if at least seventy five percent (75%) of the turnover of the party to the combination is derived from exports out of India (c) an acquisition or acquiring of control over an enterprise is by a liquidator, administrator or receiver appointed through court proceedings or through any scheme approved under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 or under the Sick Industrial Companies (Special Provisions) Act, 1985 or any other modification or re-enactment of the law; (d) an acquisition results from a gift or inheritance; (e) an acquisition is of a trustee company or arises from a change of trustees of a mutual fund established under the Securities and Exchange Board of India (Mutual F....
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....ny of the columns in Form I or Form II, the date on which they may be submitted should be clearly indicated against those columns, by the parties to the combination: Provided that the time taken by the parties to the combination to submit the requisite details shall be excluded from the period provided in sub-section (11) of section 31 of the Act and sub-regulation (1) of regulation 19 of these regulations. (7) The reference to the 'board of directors' in clause (a) of sub-section (2) of section 6 of the Act, shall mean and include,- (a) the individual himself or herself including a sole proprietor of a proprietorship firm; (b) the karta in case of a Hindu Undivided Family (HUF); (c) the board of directors in case of a company registered under the Companies Act, 1956; (d) in case of a corporation established by or under any Central, State or Provincial Act or a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956) or an association of persons or a body of individuals, whether incorporated or not, in India or outside India or anybody corporate incorporated by or the laws of a country outside India or a cooperative society registered un....
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....ation, inquire into whether such a combination has caused or is likely to cause an appreciable adverse effect on competition within India. 9. (2) Where the Commission decides to commence an inquiry, referred to in sub-regulation (1), the Commission, without prejudice to any penalty which may be imposed or any prosecution which may be initiated under this Act, shall direct the parties to the combination to file notice in Form II, as specified in Schedule Il to these regulations, duly filled in, verified and accompanied by evidence of requisite fee. (3) The notice, referred to in sub-regulation (2), shall be filed, within 30 days of receipt of communication from the Commission, by the parties to the combination. 9. Obligation to file the notice:- (1) In case of an acquisition or acquiring of control of enterprise(s), the acquirer shall file the notice in Form I or Form II, as the case may be, which shall be duly signed by the person(s) as specified under regulation 11 of the Competition Commission of India (General) Regulations, 2009. (2) In case the enterprise is being acquired without its consent, the acquirer shall furnish such information as is available to him, in Form I or....
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.... India (Competition Fund), Account No. 1988002100187687 with "Punjab National Bank, Bhikaji Cama Place, New Dehi- 110066". 13. Procedure for filing notice.- (1) The duly filled in and verified notice under regulation 5 or regulation 8 of these regulations along with two copies and an electronic version thereof shall be delivered to the Commission at the address published on its official website. (2) All responses or other documents required to be filed before the Commission consequent to the filing of the notice under regulation 5 or regulation 8 of the these regulations shall also be filed as per the procedure contained in sub-regulation (1). Provided that for the purposes of this regulation, the Secretary may through public announcement inform the procedure for electronic filing, increase or decrease the number of copies or vary the format in which the electronic version is to be filed. 14. Scrutiny of notice.- (1) The notice filed under regulation 5 or regulation 8 of these regulations shall not be valid And complete unless it is in conformity with these regulations. (2) The Secretary shall issue an acknowledgement of the receipt of notice. (3) Where the infor....
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....e to be not valid under sub-regulation (4), the Secretary shall convey the decision of the Commission to the parties to the combination within seven days of the decision of the Commission, Provided that no additional fee shall be payable if a notice is filed again by the parties to the combination for the same transaction within a period of thirty days from the date of communication of the decision of the Commission. 17. Termination of proceedings. - The proceedings under this Act relating to the combinations shall be terminated upon,- (a) receiving an intimation from the person(s) or enterprise(s) who filed the notice to the effect that the proposed combination will not take effect; (b) passing of an order by the Commission under section 31 of the Act. 18. Mode of service of notice(s), etc.- Save as otherwise provided in the Act or in these regulations, the service of any notice excluding the notice under sub-section (2) of section 6 of the Act, or intimation to any person or enterprise under these regulations shall be effected in the manner as provided in regulation 22 of the Competition Commission of India (General) Regulations, 2009 or by electronic transmission as con....
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....herwise available with the said notice, the notice to show cause to the parties to the combination and response of the parties to the same. 21. Report by the Director General.- (1) The Director General shall include in his report the basis of having reached the conclusions therein together with all evidences or documents or statements collected during the investigation and analysis thereof; (2) Two copies of the report of the Director General duly signed on each page by the Director General, or his authorized officer, along with an electronic version in document format, shall be forwarded to the Secretary within the time specified by the Commission: Provided that the Secretary may increase or decrease the number of copies of the report and may permit electronic transmission of the same. 22. Publication of the details of the combination. - (1) Where the Commission under sub-section (2) of section 29 of the Act is of the prima facie opinion that the combination has caused or is likely to cause appreciable adverse effect on competition within the relevant market in India, the Secretary shall, within four working days of such decision convey the direction of the Commission to t....
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....sed by the Commission under sub-section (3) of section 31 of the Act, the parties to the combination shall carry out such modification as per the terms and conditions and within the period as may be specified by the Commission and submit an affidavit to that effect. (3) Where the parties accept the modification proposed by the Commission under subsection (3) of section 31 of the Act or the Commission agrees with the amendment submitted by the parties under sub-section (6) of section 31 of the Act, it shall by order, approve the combination. (4) If the parties to the combination fail to accept the modification proposed by the Commission within the time referred to in sub-section (6) of section 31 of the Act or within a further period referred to in sub-section (8) of section 31 of the Act, the combination shall be deemed to have an appreciable adverse effect on competition and be dealt with in accordance with the provisions of the Act. 26. Compliance by the parties for carrying out modification.- (1) The modification referred to in regulation 25 of these regulations shall be carried out by the parties to the combination within the period as may be specified by the Commission. ....
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....quired for giving effect to the combination. (4) Where the parties to the combination fail to carry out the modification accepted by them within the stipulated time limit, the Commission shall issue appropriate directions. (5) The Secretary shall communicate to the parties to the combination, the decision of the Commission under sub-regulation (1) or (2) or (3) or (4) within seven days of such decision. (6) Having due regard to the provisions contained in sub-section (11) of section 31 of the Act, the Commission shall endeavour to pass an order or issue direction in accordance with sub-section (1) or sub-section (2) or sub-section (7) of section 31 of the Act within one hundred and eighty days of filing of the notice under sub- section (2) of section 6 of the Act. (7) Subject to the provisions of section 57 of the Act, and regulation 30 of these regulations, the orders passed by the Commission under section 31 of the Act shall be published on its website. 29. Appeal to Competition Appellate Tribunal on combinations.- Subject to the provisions contained in section 53B of the Act, the Central Government or the State Government or a local authority or enterprise or any person, ....
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....placed before the Commission and the decision of the Commission thereon shall be final and binding. SCHEDULE I [See regulation 4] (1) An acquisition of shares or voting rights, referred to in sub-clause (i) or sub-clause (ii) of clause (a) of section 5 of the Act, solely as an investment or in the ordinary course of business in so far as the total shares or voting rights held by the acquirer directly or indirectly, do not exceed fifteen per cent (15%) of the total shares or voting rights of the company, of which shares or voting rights are being acquired, directly or indirectly or in accordance with the execution of any document including a share holders agreement or articles of association, not leading to acquisition of control of the enterprise whose shares or voting rights are being acquired. (2) An acquisition of shares or voting rights, referred to in sub-clause (i) or sub-clause (ii) of clause (a) of section 5 of the Act, where the acquirer, prior to acquisition, has fifty percent (50%) or more shares or voting rights in the enterprise whose shares or voting rights are being acquired. except in the cases where the transaction results in transfer from joint control to sole....
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....the parties to the combination: (a) Legal Name of Party(s) to the combination: (b) Registration number (if applicable): (c) Name of the person signing on behalf of the party to the combination (enclose documentary proof of eligibility for signing the notice) (d) Principal business address: (e) City: Country: Postal/Zip Code: (f) Telephone No (including Country/ City/Area Code): (g) Mobile No (including Country/City/Area Code): (h) Fax No ((including Country/City/Area Code): (i) E-mail Address: (j) Website Address: (k) Jurisdiction of incorporation/Formation: (l) Role of the party in the combination: 2. Proof of payment of fee: Provide details of fee deposited along with mode and the proof of payment. 3. Provide details (in the format in 1 above) of an individual located in India who is authorized to receive communications on behalf of each of the notifying party(s) regarding this notice and related proceedings. 4. Whether covered in (a),(b),(c),(d) or (e) of sub-regulation (2) of regulation 5? If yes, please indicate under which category and how? If not covered, please proceed to fill up Part Il of the Form. Part II (Not to be filled in respect of c....
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....Provide details with regard to sales in value (in rupees) and volume (units) along with an estimate of the market shares of each of the parties to the combination for identical/substitutes/similar products or services produced/distributed/supplied in India. (In case a group, same information should be given for all parties of the group) VERIFICATION l, [NAME], [DESIGNATION], of the [FIRST/SECOND] party(s) to the combination, do hereby that the contents of the above Form are true and correct to the best of my knowledge and that nothing material has been concealed there from. VERIFIED AT [PLACE] ON THIS THE [DATE]. [NAME] [DESIGNATION] [COMPANY] (In case there are more than one applicants use the same format). IMPORTANT: THE PARTY(S) TO COMBINATION MUST VERIFY THE CONTENTS OF THE FORM BY SIGNING ON THIS PAGE. Subscribed and sworn to before me at the City: State: Country: Date: Signature: Registration Number: (Notary public) [SEAL] FORM II {See Regulation 5(2)} FORM OF FILING NOTICE WITH THE COMPETITION COMMISSION OF INDIA UNDER SUB -SECTION (2) OF SECTION 6 OF THE COMPETITION ACT, 2002 Registration No. (To be assigned by the Competition Commission of India) 1. S....
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....ads to control or may lead to control at a later date? Explain. (b) Provide details and value of assets being acquired. Whether such acquisition of assets, directly or indirectly, leads to control or may lead to control at a later date? Explain. (c) Provide details of series of constituent transactions leading to the combination and the sequence {including date(s)} in which they are likely to occur. 7. Supporting documents. - 7.1 Furnish date(s) of approval of the proposal relating to merger or amalgamation by the board of directors of the enterprise(s) concerned referred to in clause (a) of sub-section (2) of section 6 of the Act and/or other document executed in relation to the acquisition or acquiring of control referred to in clause (b) of subsection (2) of section 6 of the Act. Attach copies of such board resolution or the agreement/other document. 7.2 Furnish copies of (a) analysis, reports, studies or surveys or any other document taken into account for the purpose of assessing the impact of the combination by the parties to the combination and/or (b) final version of any document(s) prepared or commissioned by the parties to the combination or considered by the boar....
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....e) Worldwide (US$ in Million) 8.3 Furnish the following details for the current financial year, separately, for all the parties to the combination): Name of enterprise(s) Year Value of assets Aggregate Turnover In India (Rs. ni crore) Worldwide (US$ in Million) In India (Rs. in crore) Worldwide (US$ in Million) 8.4 Aggregate for the proposed Combination: Furnish the following details as per last audited annual accounts of the immediately preceding financial year. If annual accounts for the immediate preceding financial year are not audited, furnish the following details as per the last audited annual accounts as well as for the subsequent financial years: Value of Assets Aggregate Turnover For the proposed combination For the financial year immediately preceding the date of notice For the current financial year, for the completed calendar quarters till the date of notice For the financial year immediately preceding the date of notice For the current financial year, for the completed calendar quarters till the date of notice In India (Rupees in crore) (as per audited accounts) (mention year) Worldwide (US$ in million) (as per audited accounts) (mention year) In....
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....age, sale and services or trade in products or provision of services which is at different stages or levels of production chain in which any other party to the combination is involved? If yes, provide details. 9.5 Furnish details of the intended structure of ownership and control of the acquired enterprise(s) /acquirer enterprise(s)/combined enterprise(s) after completion of the combination. 10. Details about the products or services 10.1 Furnish the following details: (a) Provide separately the products (manufactured and/or sold) or services of the parties to combination. (b) Characteristics and end use of products or services (Attach current selling aids and promotional material of the concerned products or services). (c) Do the parties to combination produce/provide similar or identical or substitutable products or services, discussing specifically whether the parties to combination are engaged in any business activities in the same relevant market? (d) Market shares of the similar or identical or substitutable products or services of the parties to combination and also of rivals/competitors for similar or identical or substitutable products or services. (e) Detail....
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....State and explain (in your opinion) the scope of relevant product and relevant geographic market in relation to the proposed combination. Also provide a list of products and/or services which, in your opinion, may not fall within the scope of relevant market as mentioned above, but may pose competitive constraints. 10.9 Furnish the following : (a) the manner in which the parties to combination produce, price and sell the product and/or service in the relevant market. Also submit documents pertaining to price lists, pricing plans, pricing policies, pricing strategies, pricing analysis and pricing decisions for the previous two years as well as pricing forecast, of the parties to the combination relating to the relevant products and/or services. (b) details of prices of product and/or services in the relevant market relating to major competitors and imports , if any, during the last two years. (Attach copies of price- lists, along with the analysis, if any). 10.10 What, in your opinion, is the minimum viable scale (which means the smallest amount of production at which the average cost equals the price currently charged for the relevant product or services), the minimum and opt....
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....one numbers and email addresses. Is there a likelihood of entry of enterprise(s) of significant size in the relevant market in the next one to two years? (Attach sufficient documents/material in support). 11.8 How many enterprise(s) have exited or attempted to exit from the relevant market in the last five years? Provide their names, addresses, telephone numbers and e-mail addresses and reasons of exit. 11.9 If any of the parties to the combination have entered in the relevant market in last five years, provide details of barriers to entry encountered, if any, along with analysis. 11.10 Describe the various factors influencing entry into the relevant market, including but not limited to the following: (a) the total costs of entry (R&D, production, establishing distribution system, promotion, advertising, servicing and so forth) on a scale equivalent to a significant viable competitor, indicating the market share of such a competitor; (b) the portion of initial investment that will be permanently lost on exit; (c) any legal or regulatory barriers to entry, such as government authorization or standard setting in any form, as well as barriers resulting from product certificat....
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....ails along with their individual shares in your sales/supply. 11.16 Explain the structure of demand in the relevant market, including the following, supported by the documents/data relied upon by the parties to the combination, while taking decisions in the ordinary course of business: (a) role of product differentiation in terms of attributes or quality and the extent to which the products or services of the parties to the combination are close substitutes; and (b) role of switching cost (in terms of time and expense) for customers when changing from one supplier to another. 11.17 Are there any obligations to comply with language requirements, if any, in respect of the products/user's manual, etc. in any part of India? If yes, provide details. (Attach documents/ material sufficient to show any impact language has on the sale or distribution of each similar or identical or substitutable product or service). 11.18 Explain the importance of R&D capabilities of an enterprise to compete in the relevant market. Explain the nature and extent of the R&D activities, if any, carried out by the parties to the combination over the past few years. 11.19 State the intended R&D activitie....
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....or is likely to have an appreciable adverse effect on competition in the relevant market, the parties to the combination may be required to furnish such additional information. (4) For the purpose of figures in this Form the accounting standards, as notified by the Government of India, from time to time, or the International Financial Reporting Standards or the US Generally Accepted Accounting Principles shall be followed. (5) Assets shall mean total assets and its value shall be computed in accordance with explanation (c) of section 5 of the Act. (6) The turnover shall be computed in accordance with section 2(y) of the Act, excluding indirect taxes, if any. (7) The rate of conversion of foreign exchange currency into Indian Rupees or US Dollars shall be based on the average spot rate of the last six months quoted by the Reserve Bank of India from the date calculated with reference to the event given in section 6(2) of the Act. (8) Unaudited figures shall be certified by the Managing Director, Director, the Chief Executive Officer or the Chief Financial Officer of the enterprise duly authorized by the board and accompanied by a certificate of the auditor of the enterprise....
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....ocuments/reports etc). 3. Whether the acquirer/buyer is: (a) public financial institution; or (b) foreign institutional investor; or (c) venture capital fund; or (d) bank. 4. Describe the nature and extent of acquisition and justification to the effect that acquisition attracts the provisions of sub-section (4) of section 6 of the Act. 5. Furnish details of approval by the board of directors of the acquirer or execution of agreement or other document and-also whether filing of details is within the time specified, or otherwise, the extent of delay in filing and the reasons thereof. 6. Whether the "acquisition" is subject to foreign filing requirements, and, if yes, list the jurisdictions and furnish the details. 7. Whether details of acquisition being filed is original or corrective, and, in case of latter, indicate the date of original filing and attach a copy thereof. 8. Indicate as to whether: (i) entity to which loan has been given or investment has been made and (ii) any of the party to which the loan has already been given / investment has already been made, are engaged in production, supply, distribution, storage, sales or trade of similar or identica....
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....exercised. Details of common Directors/ Partners/ Co-parceners / Trustees. Note: Furnish details of the nature of direct as well as indirect control as the case may be. 14. Whether, in your opinion, the acquisition of (including share subscription or financing facility) voting rights or assets is likely to cause or has caused an appreciable adverse effect on competition in the market in India? 15. Any other additional information which, in your opinion, is relevant may be furnished. VERIFICATION Certified that this form together with all appendices and attachments thereto has been prepared an complied under my supervision in accordance with the provisions of the Competition Act, 2002 and the rules and regulations made thereunder. It is verified that the details of acquisition, under sub-section (5) of section 6 of the Act, which have been filed, are true to the best of my knowledge and belief and nothing material has been concealed therefrom. However, where specific data /information is not available due to the absence of authentic source reasonable estimates have been made, which are to the best of knowledge true, correct and complete and in accordance with the provisions ....