The Confederation of Indian Industry (CII) has said the Competition Act does not appropriately address the industry's concerns and needs to be amended for ensuring that M&A regulations promote growth.
The industry body's appeal is particularly in regard to Sections 5 and 6 of the Competition Act, 2002, which mandates large companies to seek the Competition Commission of India's (CCI) nod before going ahead with merger or acquisitions.
"We believe that the current provisions of the competition law do not adequately address the concerns of the industry, especially with regard to the regulation of combinations. We have highlighted the issues in the past too and again request for an amendment of the Competition Act to make it conducive to the industrial and economic growth of the country," CII Director General Chandrajit Banerjee said.
The CII said it feels that grouping the assets or turnover of business conglomerates without considering the different product markets being addressed by various entities in the conglomerate, is not a proper approach.
Stressing that coordination of regulatory filings across multiple jurisdictions in cross border M&A may be time-consuming, CII has suggested that the parties to a proposed combination should be allowed to voluntarily notify the Commission of a combination at any time prior to or within thirty days of the decision to combine without having to wait for the trigger event.
Also, the Commission should reduce its maximum days for approval from 210 days to 120 days.
Further, with a view to avoiding frivolous appeals by third parties like competitors with vested interest, CII has suggested that the Appellate Tribunal should admit an appeal only on being convinced of its material impact on the appellant.
The CII also said that the government needs to be provided flexibility to exempt enterprises from time to time to promote sectors of business which are affected by the international economic climate.