India’s Modernised Competition Law Framework
India’s competition law framework has been modernised through the Competition (Amendment) Act, 2023, with new provisions taking effect through 2024. The changes aim to make the law faster, fairer, and better suited for the digital economy. Key updates include introducing Settlement and Commitment options to resolve cases quickly, adding a ₹2,000 crore Deal Value Threshold to monitor big tech mergers, allowing penalties based on global turnover for stronger deterrence, and expanding the law to cover digital platforms and e-commerce that may enable cartel-like behaviour. Together, these reforms align India’s enforcement architecture with global best practices in antitrust regulation.
New Procedural Mechanisms – Commitment and Settlement
Two landmark additions – Section 48A (Settlement) and Section 48B (Commitment) – introduce alternative resolution mechanisms for antitrust violations:
- Commitment (Section 2(ea)): Allows enterprises to offer behavioural or structural remedies before the Director General (DG) completes investigation.
- Settlement (Section 2(ua)): Enables parties to settle post-investigation (after receiving the DG’s report) but before final adjudication.
- Scope: Crucially, these mechanisms are only applicable to vertical agreements (Section 3(4)) and abuse of dominance (Section 4) cases – they are excluded from application in cartel cases under Section (Section 3(3)).
- Compensation: The amendments clarify that even in case of a settlement, the CCI retains discretion to award compensation to affected parties under Section 53N, even in settled cases.
Penalty Regime Overhaul
The amendments significantly increase the financial and personal stakes for non-compliance.
- Global Turnover-Based Penalty: Penalties for contraventions of Section 3 (Anti-Competitive Agreements) and Section 4 (Abuse of Dominance) are now calculated based on the enterprise’s global turnover derived from all products and services, not just the “relevant” turnover in India (Section 27(b) Explanation). Penalties under Section 27(b) may now be calculated on the basis of global turnover, moving away from the previously adopted ‘relevant turnover’ principle.
- Individual Liability: Penalties on individuals (directors, managers, etc.) found liable for contravention have been clarified to be up to 10% of their average income for the last three preceding financial years (Section 48).
- Increased Penalty for False Statements: The penalty for making false statements or omitting material information during CCI proceedings has been substantially increased from ₹1 crore to up to ₹5 crores (Section 44).
- Mandatory Deposit for Appeal: Any party appealing a CCI order imposing a penalty to the National Company Law Appellate Tribunal (NCLAT) must deposit 25% of the penalty amount before the appeal can be entertained (Section 53B). This aims to deter frivolous appeals and ensure prompt compliance.
Merger Control – Deal Value Thresholds and Procedural Changes
The 2023–2024 amendments introduce a more nuanced and responsive framework for merger control under Sections 5 and 6 of the Competition Act, 2002. These changes aim to capture high-value transactions in the digital economy while streamlining procedural timelines and clarifying regulatory expectations.
- Deal Value Threshold (Section 5(d)): Combinations must now be notified to the Competition Commission of India (CCI) if the value of the transaction exceeds ₹2,000 crore, provided the target enterprise has substantial business operations in India, as may be specified by regulations. This threshold is designed to capture acquisitions of digital platforms and tech firms that may not meet traditional asset or turnover criteria but pose significant competitive risks.
- Expanded Definition of Control: The term “control” has been redefined to mean the ability to exercise material influence over the management, affairs, or strategic commercial decisions of an enterprise. This formalizes the CCI’s decisional practice and broadens the scope of reviewable transactions.
- Reduced Review Timeline (Section 6(2A)): The statutory time limit for the CCI to assess a proposed combination has been shortened from 210 days to 150 days, enhancing procedural efficiency and reducing deal uncertainty.
- Flexible Filing Window (Section 6(2)): The earlier requirement to file within 30 days of board approval or agreement execution has been removed. Parties must now notify the CCI any time after approval or execution but before consummation of the transaction, allowing greater flexibility in deal structuring.
- Open Market Acquisitions (Section 6A): Acquirers may purchase shares or convertible securities through regulated stock exchanges prior to CCI approval, provided they do not exercise any ownership or beneficial rights (such as voting or dividends) until clearance is obtained. This provision facilitates timely execution of open offers under the SEBI Takeover Code without compromising regulatory oversight.
Together, these reforms modernize India’s merger control regime, making it more adaptive to contemporary deal structures and global enforcement standards.
Cartels and Anti-Competitive Agreements
The amendments expand how cartels and unfair agreements are defined and enforced, especially when third parties help organize or support them.
Hub-and-Spoke Cartels: The law now covers not just direct competitors but also third parties or platforms that help coordinate collusion between businesses. Such “hubs” can be held responsible even if they are not in the same line of trade (Section 3(3)). The amendments formally recognize hub-and-spoke arrangements, where facilitators or platforms may be held liable for enabling collusion.
Leniency Plus: A company being investigated for one cartel can get an extra reduction in penalty if it reveals another, separate cartel to the authorities (Section 46 proviso). This incentivizes deeper cooperation with the Commission and enhances cartel detection.
Vertical Agreements Exception: Deals between a business and an end consumer are now clearly excluded from being treated as vertical restraints (Section 3(4) Explanation).
Institutional Capacity and Limitations
The amendments aim to improve efficiency, expertise, and clarity in how the Competition Commission of India (CCI) works.
Time Limit: The CCI can now take up cases related to anti-competitive practices (Section 3 and Section 4) only within three years from when the issue first arose (Section 19(1) proviso).
Tech Expertise: When appointing the CCI Chairperson and Members, the selection committee must include people with knowledge and experience in technology (Section 8 and Section 9).
Power to Summon Agents: The Director General (DG) can now summon and question agents connected to a company under investigation, such as bankers, legal advisors, and auditors (Section 41(3)).
Avoiding Duplicate Cases: Section 26(2) empowers the CCI to dismiss cases that replicate previously adjudicated facts or issues, promoting procedural economy.
Conclusion – Moving Toward a Modern and Responsive Competition Law
The 2023-2024 amendments represent an important step in updating India’s competition law. The new rules make it more flexible and suited to today’s fast-changing markets. By adding quicker ways to resolve cases, clearer definitions, new merger rules for big digital deals, and stronger penalty systems, the law is now more practical and globally aligned. These changes mean that businesses must adapt their strategies, understand market dynamics better, and follow fair competition practices more proactively. As markets evolve and digital platforms reshape competition, these reforms position India to respond with agility, transparency, and global relevance.
