CCI to Review M&A Deals Over ₹2,000 Crore with Substantial India Operations

The Competition Commission of India (CCI) has introduced a new deal value threshold (DVT) criterion for mergers and acquisitions (M&A) exceeding ₹2,000 crore, provided the target company has substantial business operations in India. This move is aimed at bringing more deals, especially in the digital and start-up sectors, under regulatory scrutiny.

Previously, regulatory approval was based on asset or turnover values, such as ₹2,500 crore in assets or ₹7,500 crore in turnover. Under the new rules, deals involving target companies with substantial business operations in India, based on metrics like the number of users, gross merchandise value, or turnover, will now require CCI review if these exceed 10% of global figures in the preceding 12 months.

Experts believe the DVT will significantly impact the M&A landscape, with more transactions now subject to CCI scrutiny. “The new threshold broadens the range of transactions subject to CCI oversight, potentially increasing compliance costs and extending deal timelines,” said Prithiviraj Senthil Nathan, partner at King Stubb & Kasiva.

Legal professionals view the DVT as a necessary step to address high-value deals in technology sectors that often escape traditional thresholds. “The DVT is a valuable tool for capturing deals that might otherwise have gone unnoticed,” noted Avaantika Kakkar, Partner at Cyril Amarchand Mangaldas.

However, the introduction of DVT may also increase the CCI’s workload, with experts calling for a capacity enhancement at the commission to handle the expected rise in notified transactions.