The Competition Commission of India (CCI) today said the proposed exclusion of bank mergers from its purview is "not good" as other sectors may also claim such exemptions.
"Such exclusions or exemptions are not good. Because when you have a competition regulator, merger issues should come to only that regulator," CCI Chairman Ashok Chalwa said on the sidelines of an Assocham event here.
A Parliamentary Standing Committee, in its report on the Banking Laws (Amendment) Bill, 2011, tabled in the Lok Sabha earlier this week, has supported the government's proposal to keep bank mergers outside the purview of CCI temporarily but with certain caveats.
While it supports the government's proposal to keep bank mergers outside CCI's purview, it recommended that this exception should be considered as a special case.
Sections 5 and 6 of the Competition Act, 2002, empower CCI to approve high voltage mergers and acquisitions.
Earlier addressing the gathering, Chawla said intra- corporate group restructuring will alter the country’s economic architecture and ultimately benefit consumers as more Indian companies get involved in cross-border mergers and acquisitions (M&As) than ever before.
"What I think is likely to happen and pay off is a fair amount of intra-group corporate restructuring which will generally clean up the manner in which business activity takes place and benefit consumers eventually," he said.
He further said that the inter-play of market forces calls for a broad regime to avoid adverse practices and improve businesses for consumer satisfaction.
"We would like to encourage creation of entities which can deliver faster and better goods and services," he added.
Minister of State for Corporate Affairs RPN Singh said emerging markets are compelling places to be in for international companies.
"M&A activity is likely to pick up worldwide in years to come due to higher growth and the desire of companies to invest the cash hoarded during recession," the minister said.
He further said that the industry leaders must gather confidence, and facilitate regulators and policymakers to ensure sustainable inclusive growth for the well-being of all stakeholders in the society.
