2024: THE AXIOM5 YEAR-IN-REVIEW
India's competition law regime underwent significant changes in 2024. Here is a quick recap of the key developments in 2024 and likely trends for the year ahead.
Highlights from 2024
Significant changes to the Competition Act
2024 has been an important year for competition law in India. The Competition Act underwent a major overhaul in 2023, with the amendments coming into effect in 2024. In September 2024, the Ministry of Corporate Affairs (MCA) and the Competition Commission of India (CCI) also released a revised set of implementing rules and regulations through a series of notifications.
Changes to the merger control regime include: (i) the introduction of the deal value threshold, requiring notification of transactions exceeding INR 20 million if the target has substantial business operations in India, (ii) the expansion of the definition of control to include “material influence”, (iii) procedural changes, such as shortened timelines for review, (iv) simplified and revised exemptions, (iv) streamlined processes for on-market transactions, and (v) the fine-tuning and clarification of the process for offering remedies.
On the behavioural front, changes include: (i) the introduction of a settlements and commitments regime, (ii) the introduction of a “leniency plus” program, (iii) the ability to penalise enterprises on the basis of their global turnover, and (iv) the recognition of “hub and spoke” cartels.
The issuance of the Draft Digital Competition Bill (DCB)
The Ministry of Corporate Affairs formed the Committee on Digital Competition Law (CDCL) to address competition concerns in digital markets in February 2023. After a year of deliberation, the CDCL proposed supplementing the existing Competition Act with an ex-ante framework outlined in a draft DCB. The DCB empowers the CCI to regulate “systemically significant digital enterprises” (SSDEs), using both quantitative and qualitative criteria to identify those with significant market power. SSDEs are obligated to ensure fair competition by avoiding practices like self-preferencing, data exploitation, and restricting user choice. The DCB is at the draft stage, with reports suggesting ongoing inter-ministerial and stakeholder consultations.
Issues to watch in 2025
Increase in the number of merger filings
The introduction of the DVT and the broadened "material influence" standard for control significantly expand the scope of India's merger control regime. The DVT is an additional threshold which captures high-value deals with significant local nexus to India, particularly in the digital sector, while "material influence" has been introduced as the lowest form of control and requires further guidance by the CCI. These changes are also likely to make merger filing assessments and mapping of overlaps challenging, until the CCI issues corresponding guidance for the benefit of stakeholders.
This expansion also means that more transactions, including those involving large tech companies and emerging startups, will require notification to the CCI. Consequently, a substantial increase in merger filings is expected.
Potential increase in the number of gun-jumping cases
The interpretation of the amendments to India's merger control regime, including those relating to the deal value threshold and "material influence" standard, could raise the risk of gun-jumping. Absent specific guidance from the CCI on the interpretation of these changes, transacting parties’ interpretation of the law (in terms of premature closing) is more likely to be contested by the CCI.
For example, ambiguity in defining "substantial business operations" and calculating "deal value," coupled with the subjective nature of "material influence," can lead to misinterpretations and delayed notifications. The pressure to close deals quickly in dynamic markets further exacerbates this risk. As a result, there is likely to be an uptick in the number of gun-jumping cases considered by the CCI.
Increase in engagement with the CCI for swift scrutiny of merger filings
The CCI’s review timelines have been revised with the aim to shorten the overall review period, but they require careful management of deal dynamics and engagement with the CCI. Although quicker timelines seem appealing, they could ironically extend the review and clearance process. For example, the CCI is already at full capacity and might frequently use the new "clock-stop" provision to address deficiencies and ensure sufficient review time.
Parties should consider early engagement with the CCI to avoid the increased risk of transaction invalidation or more extensive Phase II scrutiny due to shorter review periods. Initiating pre-filing consultations early in the deal process would help achieve smoother and more timely approvals.
Likely increase in the number of settlement and commitment applications
Amendments to the Competition Act streamlining settlements and commitments, offering businesses faster resolutions and greater regulatory certainty are expected to drive a surge in applications.
Continued scrutiny of the digital sector
The digital sector is likely to face intensified scrutiny in the coming year. We expect final decisions in ongoing tech investigations, a surge in merger reviews involving the digital sector, and the potential introduction of the Digital Competition Act. The CCI's focus on digital markets is also likely to further intensify following the July 2025 release of its market study on artificial intelligence.