As India introduces a new anti-monopoly regime, valuable insights may be drawn from Australia’s experience
Dave Poddar and Nicholas Lingard explain
The Indian Competition (Amendment) Act, 2007, which was passed into law on 10 September, updated India’s previous competition act of 2002. When assessing the likely implications of the act, particularly in the areas of merger control and third-party access to infrastructure, important lessons may be learnt from Australia’s Trade Practices Act, 1974, which is widely regarded as one of the toughest pieces of competition regulation legislation in the world.
An overriding concern of India’s competition legislation is the need to ensure that all mergers and acquisitions (M&As) reach the attention of the Competition Commission of India (CCI). There is a natural fear that without an effective notification mechanism, some problematic mergers might be “missed”.
Compulsory notification
This concern is reflected in many of the act’s provisions, not least in its controversial and potentially problematic pre-merger notification requirement, which makes it compulsory for companies to notify the CCI of any merger plans. Furthermore, the “local nexus” thresholds that determine whether an M&A deal is relevant to India, and therefore subject to mandatory notification in India, are comparatively low and the time requirements for notifications are stricter than in many other jurisdictions. Critics fear that these provisions may inadvertently capture a large number of global transactions that have little or no relevance to India.
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Dave Poddar is a partner at Mallesons Stephen Jaques in Sydney, Australia. He specializes in competition law, particularly mergers and acquisitions, as well as dominance and cartel laws. He is a deputy chair of the Trade Practices Committee of the Law Council of Australia, an officer of the International Bar Association Antitrust Committee and a member of the Financial Services Institute of Australasia’s (FINSIA) market policy group.
Nicholas Lingard is a solicitor at Mallesons Stephen Jaques in Sydney. He has spent periods at the firm’s Hong Kong office and advises on acquisitions, joint ventures and general competition and corporate matters. He has assisted with a number of law reform projects, including as a member of the International Bar Association working group on Indian merger control.
