India eyes a seat at the global M&A table – TechCrunch

India has emerged as a key overseas market for several global tech giants over the past decade, as Meta, Google and Amazon aggressively competed for the next, and perhaps last, major growth region. Now the South Asian nation is trying to use its vast reach to influence mergers and acquisitions abroad.

New Delhi proposed amendments to its Competition Law on Friday 2002 to introduce a number of changes including requiring local regulator (Competition Commission of India) approval for all foreign transactions valued at over US$252 million for companies with “significant operations in India”.

India, the world’s second largest internet market, which has attracted tens of billions of dollars in investments from Meta, Google and Amazon, as well as venture capitalists such as SoftBank, Sequoia and Tiger Global, has traditionally screened deals based on asset size rather than transaction value. According to law firm Shardul Amarchand Mangaldas, the Indian regulator approved over 700 fillings in the last decade alone.

But things seem to be changing, trying to level India’s position with that of China, the US and Europe.

“Over the last decade there has been significant growth in Indian markets and a paradigm shift in the way companies operate. In light of the economic development, the emergence of various business models and the lessons learned from the work of the commission, the Indian government has set up a Competition Law Review Committee to consider and propose the amendments to the said law,” the draft law published on Friday afternoon said.

The Competition (Amendment) Bill, 2022 proposed the following changes:

(a) changes to certain definitions such as “company”, “relevant product market”, “group”, “control”, etc. to provide clarity;
(b) broadening the scope of anti-competitive agreements and including a party facilitating an anti-competitive horizontal agreement within such agreements;
(c) Provisions to reduce the time limit for approval of combinations from two hundred and ten days to one hundred and fifty days and to form a prima facie assessment by the Commission within twenty days for expeditious approval of combinations;
(d) Provisions for “value of the transaction” as an additional criterion for notifying concentrations to the Commission;
(e) three-year statute of limitations for submitting information on anti-competitive agreements and abuse of a dominant position to the Commission;
(f) Appointment of the Director-General by the Commission with the prior approval of the central government;
(g) introducing a settlement and commitment framework to reduce litigation;
(h) incentivizing parties in an ongoing antitrust investigation to disclose information about other cartels in order to obtain a reduced penalty;
(i) replacement of a provision imposing a penalty of up to Rs. 1 crore or imprisonment of up to three years, or both, for breach of an order of the National Company Law Appellate Tribunal with a provision of contempt;
(j) Issuing guidelines including the sanctions to be imposed by the Commission.

The move comes at a time when bankers in India are facilitating a record number of mergers and acquisitions, even as transaction activity is slowing elsewhere. According to Bloomberg, more than $82 billion worth of deals were closed or initiated in India in the quarter ended June. The deal flow in India is expected to increase further.

“India is an extremely important market for sovereign wealth funds, private equity and global pension funds, which are a growing factor in the number of M&A transactions currently taking place,” said Kaustubh Kulkarni, head of investment banking in India at JP Morgan and Southeast Asia, in a recent television interview. India eyes a seat at the global M&A table – TechCrunch

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