34 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC. 4]
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36 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC. 4] THE COMPETITION COMMISSION OF INDIA NOTIFICATION New Delhi, the 11th May, 2011 Ths Competition Commission of India (Procedure in regard to the trafi»<^lion of business relating to combinations) Regulations, 2011 (No. 3 of 2011) F. No. 1-1/Combinatlon Regu5ations/2011-12/CD/CCt—|in exercise of the powers conferred by sub-section (1) and clauses (b), (c) and (f) of sub-section (2) of section 64 read with sub-sections (2) and (5) o< section 5 of the Competition Act, 2002 ( 12 of 2003), the Competition Commission of India hereby makes the following regulations, nameiy:-
1. Short title and commencement-
(1) These regulations may be called the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011.
(2) They shall come into force on 1 st day of June, 2011.
2. Definitions.-
(1) In these regulations, unless the context otherwise 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 sub section (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;
[W\ 111—33^4] *TRcT ^>T < M H 3 S SraTtTR^T 37
(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, reference to 'days' shall mean calendar days unless otherwise specified in these regulations or the Act.
(3) Words and expressions used but not defined in these regulations shall have the same meanings respectively as assigned to them in the Act or the rules or regulations framed thereunder or in the Companies Act, 1956 (1 of 1956).
Power to determine procedure in certain circumstances.- In a situation not provided for in these regulations or the Competition Commission of India (General) Regulations, 2009, the Commission may determine the procedure, in specific matters, if so required.
Categories of transactions not likely to have appreciable adverse effect on competition in India.- In view of the duty cast upon the Commission under section 18 and powers conferred under section 36 of the Act, and having regard to the mandate given to the Commission to, inter-alia, regulate combinations which have caused or are likely to cause appreciable adverse effect on competition in terms of sub-section (1) of section 6 of the Act, it is clarified that since the categories of combinations mentioned in Schedule I are ordinarily not likely to cause an appreciable adverse effect on competition in India, notice under sub-section(2) of section 6 of the Act need not normally be filed.
Form of notice for the proposed combination.-
(1) Any enterprise which proposes to enter into a combination shall give notice of such combination to the Commission in accordance with sub-section (2) of section 6 of the Act and these regulations.
(2) The notice under sub-section(2) of section 6 of the Act, shall ordinarily be filed in Form I as specified in schedule II of these regulations, duly filled in, verified and accompanied by evidence of payment of requisite fee by the parties to the combination including the instances where - 38 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC. 4]
(a) none of the parties to the combination are engaged in the production, supply, distribution storage . sale or trade of similar or identical or substitutable goods or provision of similar or identical or substitutable services, or the parties to combination are not engaged different stages or levels of the production chain in different markets, in respect of production, supply, distribution, storage, sale or trade in goods or provision of services in which another party to the combination is engaged;
b) the parties to the combination are 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 Fund) Regulations 1996, as amended from time to time;
(f) the parties to combination are engaged in production, supply, distribution, storage, sale or trade of similar or identical or substitutable goods or provision of similar or identical or substitutable service and the combined market share of the parties to the combination after such combination is less than fifteen percent (15%) in the relevant market;
(g) the parties to the combination are engaged at different stages or levels of the production chain in different markets, in respect of production, supply, distribution, storage, sale or trade in goods or provision of services, and their individual or combined market share is less than twenty five percent (25%) in the relevant market.
I'm III—W*Z 4] Wsi-m TFsm : awwuui 39
(3) Notwithstanding the provisions of sub-regulation (2), the parties to the combination may, at their option, annex additional supporting documents, if any, with Form I or file notice in Form II as specified in schedule II of these regulations.
(4) Where in the course of inquiry, it is found by the Commission that it requires additional information, the Commission may direct the parties to the combination to file such additional information:
Provided that the time taken by the parties to the combination in filing such additional information 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, -
(5) Having due regard to the provisions of sub-regulations (2) and (4), in cases where the parties to the combination have filed notice in Form I and the Commission requires information in Form II to form its prima facie opinion whether the combination is likely to cause or has caused appreciable adverse effect on competition within the relevant market, it shall direct the parties to the combination to file notice in Form II as specified in schedule II to these regulations:
Provided that the fee already paid by the parties to the combination while filing notice in Form I shall be reduced from the fee payable for filing notice in Form II:
Provided further that the time taken by the parties to the combination in filing notice in Form II 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.
(6) If the requisite details are not available for any 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;
• 40 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC. 4]
(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 under the laws of a country outside India or a cooperative society registered under any law relating to cooperative societies or a local authority, the person or the body so empowered by the legal instrument that created the said bodies;
(e) in the case of a firm, the partner(s) so authorized;
(f) in the case of any other artificial juridical person not falling within any of the preceding sub- clauses, by that person or by some other person competent to act on his behalf.
(8) The reference to the 'other document' in clause (b) of sub-section (2) of section 6 of the Act shall mean any binding document, by whatever name called, conveying an agreement or decision to acquire control, shares, voting rights or assets :
Provided that if the acquisition is without the consent of the enterprise being acquired, any document executed by the acquiring enterprise, by whatever name called, conveying a decision to acquire control, shares or voting rights shall be the 'other document':
Provided further that where such a document has not been executed but the intention to acquire is communicated to the Central Government or State Government or a Statutory Authority, the date of such communication shall be deemed to be the date of execution of the other document for acquisition.
6. Filing of details of acquisition under sub-section (5) of section 6 of the Act.-
(1) The details of acquisition by a public financial institution, foreign institutional investor, bank or venture capital fund, referred to in sub-section(5) of section 6 of the Act, shall be filed without any fee in Form III, as specified in Schedule II to these regulations.
(2) The duly filled in and verified Form III, along with two copies and electronic version thereof, shall be delivered to the Commission at the address published on its official website .
7. Belated notice Where a notice filed in Form I or Form II under sub-regulations (2) or (3) of regulation 5 of these regulations is received in the Commission beyond the time limit mentioned in sub-section (2) of section 6 of the Act, the Commission may, without prejudice to other provisions including that Of section 43A of the Act, admit such notice.
[TFT I I I — ^ ^ 4] *m cR XFsm : 3RTI«in̂ T 41
8. Failure to file notice.-
(1) Where the parties to a combination fail to file notice under sub-section (2) of section 6 of the Act, the Commission may under sub-section (1) of section 20 of the Act, upon its own knowledge or information relating to such combination, inquire into whether such a combination has caused or is likely to cause an appreciable adverse effect on competition within India.
(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 II 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 Form II, as the case may be, relating to the enterprise being acquired:
Provided that all information required to be filed, relating to the enterprise being acquired shall be filed with the Commission within fifteen days from filing of the notice and in case the acquirer is not in a position to furnish all the required information in Form I or Form II, as the case may be, relating to the enterprise being acquired, the Commission may direct the enterprise being acquired to furnish such information as it deems fit and the time taken by the parties to the combination or the acquired enterprise, as the case may be, in furnishing the required information including document(s) 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.
(3) In case of a merger or an amalgamation, parties to the combination shall jointly file the notice in Form I or Form II, as the case may be, duly signed by the person(s) as specified under regulation 11 of the Competition Commission of India (General) Regulations, 2009.
(4) Where the ultimate intended effect of a business transaction is achieved by way of a series of steps or smaller individual transactions which are inter-connected or inter-dependent on each \C1HG\)/)) —<G 42 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC. 4] other, one or more of which may amount to a combination, a single notice, covering all these transactions, may be filed by the parties to the combination.