Parties to a combination can avail the green channel route subject to various conditions, including that there is no horizontal overlap or vertical relationship.
Putting in place a speedier approval mechanism, Competition Commission has introduced a green channel route for clearing certain categories of mergers and acquisitions. The green channel concept — recommended by the high level panel that reviewed competition law — would allow for an automatic system for speedy approval of combinations subject to certain conditions. “Under this process, the combination is deemed to have been approved upon filing the notice in the prescribed format. This system would significantly reduce time and cost of transactions,” Competition Commission of India (CCI) said in a release on Monday. Mergers and Acquisitions (M&As) or combinations beyond a certain threshold are required to have mandatory approval from the fair trade regulator.
The watchdog has also revised its pre-filing consultation guidance note to assist the parties in determining their eligibility for green channel route. “The green channel is aimed to sustain and promote a speedy, transparent and accountable review of combination cases, strike a balance between facilitation and enforcement functions, create a culture of compliance and support economic growth,” the regulator said. So far, the regulator has cleared 666 combinations, as per the release.
The regulations pertaining to combinations under the competition law have been amended. According to the amended norms, the parties to scheduled combination are required to file notice with the regulator in a prescribed format along with a declaration. A summary of the combination with details regarding name of the parties, nature and purpose, products, services and business of the parties, among other details should be submitted for the purpose of publishing on the CCI website.
The amended regulation provide for a single summary of the proposed combination. Earlier, entities had to provide both a short as well as a long summary, according to a note prepared by Vaish Associates, Advocates. Parties to a combination can avail the green channel route subject to various conditions, including that there is no horizontal overlap or vertical relationship.