By IANS,
New Delhi : The Competition Commission of India (CCI) will soon finalise regulation on mergers and acquisitions that will help block deals that may create monopoly in the market, Corporate Affairs Minister Murli Deora said Thursday.
“The Competition Commission will check mergers that end up in creating monopolies or abuse of dominance,” Deora said at a conference organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) in association with CCI.
He said the panel would check potential monopolistic deals because they were harmful to consumers and small producers and impede orderly economic growth.
The CCI has received comments from various stakeholders, including industry chambers, on the proposed mergers and acquisition norms, and is likely to finalise the regulations early next month.
Once the new regulation is in place, all large companies would be required to take prior approval of the CCI for any merger or takeover deal.
Deora said the CCI would speedily clear mergers and takeover deals that increase efficiencies due to economies of scale, combined production plants, integrating procurement and pooling of research and development resources.
Experience of developed economies like the US and Europe has made it increasingly evident that regulation of mergers and acquisitions helps in strengthening the market and its competitiveness to the advantage of consumers and the economy, the minister said.
“It is in this context that the government had notified Sections 5 and 6 of the Competition Law relating to combinations, including acquisitions, enquiries of control and mergers and amalgamations,” Deora said.
Notification of Sections 5 and 6 of the Competition Act, 2002, makes it mandatory for all companies with turnover of over Rs.1,500 crore to take prior approval from the CCI for any mergers or takeover deals.
The government issued the notification in this regard March 4.