Pending deal approvals: Industry participants flag lack of quorum at CCI

Mergers and acquisitions beyond a certain threshold require the approval of Competition Commission of India (CCI) under the Competition Act, 2022. Section 5 and 6 of the Act relate to regulation of combinations in the country
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NEW DELHI: With various mergers and acquisitions awaiting CCI approval, industry participants have sought measures to address the issue of lack of quorum at the competition watchdog which does not have a chairperson for more than two months now.

Mergers and acquisitions beyond a certain threshold require the approval of Competition Commission of India (CCI) under the Competition Act, 2022. Section 5 and 6 of the Act relate to regulation of combinations in the country.

For approval of combinations, the regulator needs to have a quorum of three members. However, since the retirement of Chairperson Ashok Kumar Gupta on October 25, 2022, there are only two members, resulting in lack of quorum at CCI.

Against this backdrop, various industry players have sought measures to address the current situation till a new chairperson is appointed, saying the lack of quorum is causing delays in clearances for combinations that have been notified to the regulator.

The concerns have been flagged to the corporate affairs ministry, which is the administrative ministry for CCI. ing law firm Cyril Amarchand Mangaldas’ Partner (Head - Competition Law) Avaantika Kakkar has written to the ministry regarding lack of quorum at CCI.

“As on date, a total of 15 combinations (transactions notified to the CCI) are pending CCI’s review, including multiple global transactions and transactions under the ambit of the Insolvency and Bankruptcy Code, 2016.

“The lack of quorum at CCI and its consequent inability to pass any valid orders approving such notified combinations is affecting multiple stakeholders negatively, including acquirers, financial investors, creditors/ lenders, shareholders, employees of relevant parties etc,” she said in a letter, dated January 11, to the ministry.

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