India's Competition Law Amendments 2026, What M&A Counsel and Compliance Teams Must Know

The competition law amendments India enacted through the Competition (Amendment) Act, 2023 have now moved from statute book to operational reality, and the practical implications for deal-making are sharpening with every month. The 2023 Act, published in the Gazette on 11 April 2023, introduced a deal-value threshold for merger filings, recalibrated the penalty framework and overhauled procedural timelines, but it was the phased implementation through 2024 and the clarificatory guidance issued by the Competition Commission of India (CCI) in early 2026 that have forced M&A counsel, PE deal teams and compliance officers to revisit transaction playbooks urgently.

This guide provides the step-by-step implementation framework those practitioners need: how to model the deal-value test, when on-market purchases trigger a filing obligation, how penalty exposure has changed, and what contract clauses and internal processes must be updated before the next signing.

Executive Summary and Key Takeaways

India’s merger control regime has undergone its most significant overhaul since the Competition Act, 2002 first came into force. The Competition (Amendment) Act, 2023 introduced a deal-value threshold (DVT) that captures transactions the old asset-and-turnover tests missed, particularly acquisitions of asset-light, digital-economy targets. It also shortened the CCI’s review timeline, clarified the treatment of on-market share purchases and open offers, and shifted the penalty calculation basis in ways that materially alter corporate risk exposure.

For deal teams working on India-connected transactions, the practical effect is a wider filing net, tighter deadlines and greater penalty downside if the process is mismanaged. Early indications suggest that the CCI is actively using the new tools, meaning compliance is no longer optional due diligence, it is a deal-critical workstream.

Five actions every deal team should take now:

• Re-run threshold analysis. Model every pending and pipeline transaction against both the traditional asset/turnover thresholds and the new deal-value threshold to confirm whether a CCI filing is triggered.
• Update transaction documents. Revise conditions precedent, long-stop dates, indemnity clauses and escrow mechanics to reflect the amended review timeline and penalty exposure.
• Map on-market purchase risk. Determine whether any planned open-market acquisitions or open offers require prior CCI notification under the revised framework.
• Recalibrate penalty provisions. Adjust risk allocation and indemnity caps in SPAs and shareholder agreements to reflect the new turnover-based penalty methodology.
• Brief the board and investment committee. Ensure decision-makers understand the compressed timelines and broadened filing triggers before approving new transactions.

Background and Timeline of the CCI Amendment 2026 Framework

Legislative History

India’s merger control regime was originally established by the Competition Act, 2002, which required prior CCI approval for combinations exceeding prescribed asset-value and turnover thresholds. Over two decades, the thresholds were periodically revised, but the basic structure remained unchanged, an approach that increasingly failed to capture high-value acquisitions of companies with low revenues but significant market power, particularly in the technology and digital sectors.

The Competition (Amendment) Act, 2023 was the legislative response. Passed by Parliament and published in the Gazette of India on 11 April 2023, the Act introduced several structural changes to the Competition Act, 2002, including the deal-value threshold, a revised penalty regime, a settlement and commitment mechanism, and shortened timelines for merger review.

Effective Dates and Transitional Rules

Implementation has been phased. The deal-value threshold provisions were scheduled to come into effect from 10 September 2024, requiring parties to reassess filing obligations for transactions announced after that date. The CCI subsequently issued procedural regulations and guidance, and in early 2026 published further clarifications addressing practitioner questions around on-market purchases, filing timelines and penalty methodology, the clarifications that prompted the current wave of compliance reviews.

For transitional purposes, transactions where a binding agreement was executed before the relevant effective date generally remain subject to the pre-amendment thresholds and procedures, though parties should verify the position for each specific provision. Industry observers expect the CCI to take a substance-over-form approach where parties attempt to structure around effective dates.

The Deal-Value Test India: How It Works and How to Model Transactions

Definition and Threshold

The deal-value test was introduced by the Competition (Amendment) Act, 2023 through an amendment to Section 5 of the Competition Act, 2002. Under the DVT, a transaction constitutes a notifiable “combination” if the value of the transaction exceeds INR 2,000 crore (approximately USD 240 million), provided the target enterprise has “substantial business operations in India.” This test operates in parallel with the existing asset-value and turnover thresholds, meaning a transaction may be notifiable under the DVT even if it falls below the traditional thresholds, and vice versa.

The “substantial business operations in India” qualifier is a critical jurisdictional filter. The CCI has indicated that this will be assessed with reference to factors including users, subscribers, customers or data collected in India, rather than purely financial metrics. The likely practical effect is that acquisitions of Indian digital platforms, fintech companies and SaaS businesses with large Indian user bases will be captured even where the target has minimal Indian revenues.

Inputs and Exclusions

Modelling the DVT correctly requires careful identification of what counts as “value of the transaction.” Industry observers expect the following principles to apply based on the statutory language and CCI guidance:

• Total consideration. The value includes all forms of consideration, cash, stock, deferred payments, earnouts, non-compete fees and any other economic benefit flowing from the acquirer to the seller or the target.
• Indirect acquisitions. Where control is acquired through an intermediate holding company, the value of the entire transaction chain should be assessed, not just the direct acquisition price.
• Intra-group exclusion. Genuine intra-group restructurings (transfers between wholly-owned subsidiaries within the same group) are generally exempt from notification, consistent with the existing de minimis exemption framework.
• Taxes and transaction costs. Stamp duty, GST and advisory fees are typically excluded from the deal-value calculation, though parties should document this exclusion clearly in the filing.
• Contingent consideration. Earnouts and contingent payments should be included at their maximum potential value, not their expected or discounted value, to avoid an inadvertent failure to notify.

Worked Numerical Examples

The following three scenarios illustrate how the deal-value test India applies in practice. These examples are simplified for clarity; actual filings will require detailed analysis of all consideration components.

The key lesson from these examples: the DVT is not a replacement for the traditional thresholds but an additional net. Deal teams must model both tests for every transaction and document the analysis contemporaneously to demonstrate good-faith compliance.

On-Market Purchases CCI: Open Offers and Change-of-Control Mechanics

On-Market Purchase Rules

One of the most operationally significant questions arising from the competition law amendments India introduced through the 2023 Act concerns on-market share purchases. Under the pre-amendment regime, the treatment of creeping acquisitions and on-market purchases was ambiguous, leading to inconsistent compliance practices. The 2023 amendments, together with subsequent CCI clarifications, have brought greater, though not complete, clarity.

The core principle is that any acquisition of shares or voting rights that results in the acquirer crossing a notifiable threshold (whether under the traditional tests or the DVT) requires prior CCI approval, regardless of whether the shares are acquired on-market or through a negotiated block deal. There is no blanket exemption for stock-exchange transactions.

Open Offers and Exemptions

Open offers triggered under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations present a particular challenge because the acquirer cannot control the exact volume of shares tendered. The CCI’s approach, as clarified in its recent guidance, requires the acquirer to notify the CCI based on the maximum possible acquisition (i.e., assuming full acceptance of the open offer) and to obtain approval before completing the acquisition.

Certain exemptions and safe harbours remain relevant:

• De minimis exemption. Transactions where neither the asset-value, turnover, nor deal-value thresholds are exceeded remain exempt from notification.
• Intra-group transfers. Transfers within a group (as defined under the Act) where control does not change hands are exempt.
• Below-threshold creeping acquisitions. Incremental share purchases that do not result in crossing a notifiable threshold or acquiring control do not independently trigger a filing obligation, though cumulative acquisitions over a rolling period should be monitored.

Checklist for Deal Teams: On-Market Purchases

Competition Law Penalties India: Exposure, Calculation and Mitigation

How the Penalty Regime Has Changed

The 2023 amendments recalibrated the penalty framework under the Competition Act in two fundamental ways. First, the basis for calculating penalties on anti-competitive agreements and abuse of dominance has shifted. Under the pre-amendment regime, penalties could be imposed up to 10% of the “average of the turnover for the last three preceding financial years”, language that the CCI interpreted as referring to total or global turnover, creating exposure that was disproportionate for diversified conglomerates. The amended provision clarifies that penalties shall be calculated with reference to “relevant turnover”, the turnover attributable to products or services affected by the contravention.

Second, the amendments introduced a settlement and commitment framework that allows parties to resolve investigations without a full adjudication, a tool that, industry observers expect, will significantly influence how corporate respondents approach CCI proceedings.

Contract Allocation and Indemnity Wording

The shift to relevant turnover as the penalty base does not eliminate risk, it reshapes it. For acquirers, the key question in transaction negotiations becomes: which party bears the cost of a pre-closing antitrust contravention by the target? Deal teams should consider the following adjustments to standard transaction documents:

• Specific antitrust indemnity. Include a dedicated indemnity for competition law penalties, fines and settlement amounts attributable to pre-closing conduct, separate from the general indemnity basket.
• Relevant-turnover modelling. Require the seller to disclose product-line turnover data sufficient to model potential penalty exposure under the relevant-turnover methodology.
• Indemnity cap recalibration. Revisit overall indemnity caps to ensure they are sufficient to absorb potential CCI penalties calculated on the relevant-turnover basis, caps set under the old global-turnover framework may be either too high or too low depending on the target’s revenue mix.
• Escrow and holdback. For targets with known or suspected antitrust exposure, negotiate a portion of the purchase price to be held in escrow pending resolution of any CCI proceedings.

Antitrust Compliance India: Deal Execution Playbook

Pre-Deal Screening

Effective antitrust compliance India strategies begin well before a letter of intent is signed. In-house counsel and deal teams should build competition-law screening into the earliest stages of transaction evaluation:

• Threshold matrix. Maintain an up-to-date matrix of CCI notification thresholds (asset value, turnover, and DVT) and run every potential target against all three tests at the preliminary evaluation stage.
• Market-overlap analysis. Identify horizontal overlaps and vertical relationships between the acquirer’s and the target’s businesses in India to anticipate substantive competition concerns that may extend the review timeline.
• Prior CCI history. Check whether the target has been the subject of any CCI investigation, leniency application or settlement, any open proceedings will affect deal risk, timeline and indemnity negotiations.

Transaction Documents and Clauses

Once a transaction is confirmed as notifiable, the following elements should be addressed in the transaction documentation:

• Condition precedent. Include CCI approval as an explicit condition precedent to closing, with a long-stop date that accommodates the amended review timeline.
• Cooperation covenant. Require both parties to cooperate in the preparation and filing of the CCI notification, including providing information, attending meetings and responding to CCI queries within specified timeframes.
• Interim conduct restrictions. Include standard gun-jumping restrictions prohibiting the acquirer from exercising control or influence over the target’s business pending CCI clearance.
• Break fee and reverse break fee. Consider whether a break fee or reverse break fee is appropriate if CCI clearance is not obtained by the long-stop date, and allocate risk accordingly.

Post-Closing Obligations

Antitrust compliance does not end at closing. Post-closing obligations under the amended regime include:

• Implementation of remedies. If CCI clearance was granted subject to conditions (behavioural or structural remedies), ensure a dedicated compliance team monitors and reports on implementation.
• Ongoing creeping-acquisition monitoring. For listed targets, implement a system to track further share purchases that could cumulatively trigger a new notification obligation.
• Integration planning. Ensure that business integration steps (combining sales forces, sharing pricing data, rationalising distribution) are reviewed by competition counsel before implementation to avoid post-closing gun-jumping allegations.

Sample Deal Timeline

Practical Q&A and Quick Drafting Notes

Sample Antitrust Indemnity Clause

“The Seller shall indemnify and hold harmless the Buyer, the Target and their respective affiliates against any and all losses, liabilities, penalties, fines, settlement amounts and costs (including legal fees) arising out of or relating to any contravention of the Competition Act, 2002 (as amended) attributable to the conduct of the Target’s business prior to the Closing Date, including any penalty calculated by reference to the relevant turnover of the Target.”

Sample Escrow and Holdback Provision

“An amount equal to [●]% of the Purchase Price (the ‘Antitrust Escrow Amount’) shall be deposited into the Escrow Account on the Closing Date and shall be retained therein for a period of [●] months following Closing or, if later, until the final resolution of any pending CCI proceedings involving the Target, whichever is later.”

CCI Filing Checklist, Key Points of Emphasis

• Confirm the correct filing form (Form I for straightforward transactions; Form II for complex cases with horizontal overlaps or vertical concerns).
• Calculate and disclose the deal value and all components of consideration, including contingent payments at maximum value.
• Provide detailed market-share data for all overlapping product and geographic markets.
• Include a clear narrative on the “substantial business operations in India” qualifier if relying on the DVT.
• Attach all transaction documents, including side letters, non-compete agreements and earnout schedules.

Conclusion and Next Steps

The competition law amendments India introduced through the 2023 Act, and the CCI’s evolving implementation guidance through 2024 and into 2026, represent a fundamental shift in how transactions with an Indian nexus must be evaluated, structured and documented. The deal-value test has widened the notification net to capture asset-light, high-value acquisitions; the on-market purchase clarifications have eliminated the assumption that stock-exchange transactions are inherently exempt; and the penalty recalibration demands fresh thinking on indemnity structures and risk allocation.

The immediate priority for M&A counsel, PE deal teams and in-house compliance officers is to audit current deal pipelines against the amended thresholds, update template transaction documents, and build CCI filing timelines into project plans from day one. Practitioners who delay this work risk deal delays, gun-jumping exposure and penalties that, even under the more proportionate relevant-turnover methodology, can be substantial. For guidance on India’s antitrust compliance framework, explore the India lawyer directory to connect with experienced competition law practitioners.

Sources

1. Competition Commission of India, Legal Framework / Act
2. PRS Legislative Research, Competition (Amendment) Act, 2023
3. India Code, Competition Act, 2002
4. Press Information Bureau, CCI Press Release (February 2026)
5. Lexology, Competition Law Roundup
6. AZB & Partners, The Amended Competition Act Commentary
7. India Briefing, Antitrust Law Amendments Explainer
8. Nishith Desai Associates, Competition Law Hotline
9. Wolters Kluwer, Competition Blog