Merger Control in India (2026): Practical Guide for Cross‑border M&A, CCI Filings & the Corporate Laws (amendment) Bill

Merger control India is entering a new phase in 2026 as the Corporate Laws (Amendment) Bill, combined with the Competition (Amendment) Act, 2023 provisions that became operative in September 2024, reshapes how cross-border transactions are screened, notified and closed. For general counsel, private equity deal teams and foreign acquirers, particularly those routing investments from Japan and other Asia-Pacific jurisdictions, the practical implications are significant: revised notification thresholds, a compressed review calendar, tighter definitions of control and substantial business operations, and a parallel restructuring of Companies Act and NCLT processes that directly affects deal sequencing.

This guide consolidates the current framework as it stands in mid-2026 into an actionable playbook covering filing triggers, document checklists, timing calendars and the interplay between CCI, FDI screening and the National Company Law Tribunal.

Key takeaways for deal teams:

• Mandatory and suspensory. Notifiable combinations cannot be consummated, in full or in part, until CCI clearance is obtained or the 150-calendar-day review period expires.
• Four notification tests. Parties must assess asset/turnover thresholds, the deal value threshold (DVT) of INR 2,000 crore, the substantial business operations (SBO) test, and the expanded “material influence” definition of control.
• Compressed timelines. Phase 1 review runs for 30 calendar days; if referred to Phase 2, the total review period caps at 150 calendar days.
• Gun-jumping penalties. Implementing any part of a combination before CCI approval can attract fines of up to 1% of total turnover or assets, whichever is higher.
• Parallel regulatory tracks. Foreign buyers must coordinate CCI filings with FDI sectoral approvals and, where applicable, NCLT merger/amalgamation proceedings to avoid conflicting conditionalities.

How Merger Control in India Works (2026)

India’s merger control regime is governed by the Competition Act, 2002, as substantially amended by the Competition (Amendment) Act, 2023, and implemented through the CCI (Combinations) Regulations that took effect on 10 September 2024. The regime is mandatory and suspensory: parties to a notifiable combination must file with the Competition Commission of India before consummation and observe a standstill obligation until clearance is obtained. The Corporate Laws (Amendment) Bill, 2026 adds a further layer by proposing changes to the Companies Act, 2013 and the Limited Liability Partnership Act, 2008, which affect how amalgamations, demergers and restructurings interact with CCI notification obligations and NCLT timelines.

Key Statutory Provisions

Sections 5 and 6 of the Competition Act define “combinations” and impose the notification obligation. Section 5 sets out the financial thresholds, expressed in terms of assets and turnover at both the enterprise and group levels, and, since September 2024, includes the deal value threshold. Section 6(2) requires parties to notify the CCI within the prescribed period and prohibits consummation until approval is granted or deemed granted. The Competition (Amendment) Act, 2023 codified the concept of “material influence” as the standard for assessing control, replacing the earlier, less defined “controlling” threshold.

What Changed Between 2023 and 2026

The practical effect is that deal teams now operate within a multi-layered regime where CCI filing triggers, Companies Act restructuring mechanics and FDI screening must be sequenced carefully. The likely practical effect of the Corporate Laws (Amendment) Bill, once notified, will be to compress NCLT timelines for qualifying mergers and to introduce simplified filing requirements for certain intra-group reorganisations, though the implementing rules remain awaited.

Filing Triggers and Thresholds, Practical Decision Flow for Merger Control India

Every M&A transaction touching India requires a threshold analysis across four tests. If any one test is triggered, a merger notification India filing is mandatory before closing. The analysis below reflects the operative position as of May 2026.

Deal Value Threshold (DVT), INR 2,000 Crore

The DVT was introduced on 10 September 2024 and applies where the total value of the transaction, including direct, indirect, immediate and deferred consideration, exceeds INR 2,000 crore (approximately USD 238 million) and the target enterprise has “substantial business operations in India.” The DVT captures transactions that might fall below the traditional asset/turnover thresholds but still represent economically significant deals in digital markets or high-value sectors. Deferred consideration, earn-outs and contingent payments are included in the calculation. Industry observers expect the DVT to be the primary trigger for technology, e-commerce and pharmaceutical transactions where the target may have modest balance-sheet metrics but significant strategic value.

Turnover and Assets Tests, Sample Calculations

The traditional thresholds under Section 5 operate at both the enterprise and group levels. Parties must calculate the combined assets or turnover of the acquirer and target (at the enterprise level) or their respective groups (at the group level) using the most recent audited financial statements. Where the enterprise-level or group-level figures exceed the prescribed thresholds, which are periodically revised and should be confirmed against the CCI’s current notification, a combination filing is triggered regardless of whether the DVT is met.

Substantial Business Operations (SBO) Explained

The SBO requirement applies exclusively to the DVT test. The CCI (Combinations) Regulations define SBO to include enterprises that derive revenue from India, have users in India, or generate gross merchandise value (GMV) from Indian operations. For digital service providers, the regulations specify that an enterprise has SBO in India if at least 10% of its global users are located in India, or if it generates significant GMV from Indian customers. This definition ensures that global digital platforms with limited physical Indian presence, but substantial user engagement, remain within the CCI’s jurisdictional reach.

Exemptions and de minimis. Certain transactions are exempt from notification. Intra-group reorganisations (where the acquirer already holds more than 50% and there is no change of control), acquisitions of less than 25% of shares where no material influence arises, and transactions falling below the de minimis exemption (where the target’s Indian assets or turnover fall below prescribed limits) do not require CCI filing. The de minimis thresholds are periodically revised by MCA notification.

Cross-Border M&A India Playbook, Practical Checklist for Foreign Buyers

For foreign acquirers, including Japanese investors who represent a significant share of inbound M&A, the Indian regulatory landscape presents three parallel approval tracks that must be carefully sequenced. Failing to coordinate CCI filings with FDI screening and, where applicable, NCLT processes can delay closings by months and create contractual exposure under conditionality clauses.

FDI Screening and Sectoral Rules, Practical Steps

India’s FDI policy operates through an automatic route (for most sectors) and a government approval route (for restricted sectors including defence, broadcasting, print media and multi-brand retail). Foreign buyers must confirm the applicable FDI route before signing, because government-route approvals from the Department for Promotion of Industry and Internal Trade (DPIIT) can take 8–12 weeks and create path dependencies for CCI filing. For Japanese investors, the typical structure involves a Singapore or Mauritius SPV holding company, which may trigger additional scrutiny under India’s “beneficial ownership” and press-note requirements, particularly where the investment sector borders on restricted categories. The practical step is to run FDI screening alongside CCI threshold analysis during the initial due diligence phase, well before term-sheet execution.

Interaction with NCLT and Companies Act Restructuring

Where the transaction is structured as a merger, amalgamation or demerger under Sections 230–232 of the Companies Act, 2013, NCLT approval is required alongside CCI clearance. The NCLT mergers process runs on its own timetable, typically 4–6 months from application to sanction order, and is independent of CCI review. Best practice is to file with the CCI and commence NCLT proceedings in parallel, with the definitive agreement containing mutual conditionality for both approvals. The Corporate Laws (Amendment) Bill, 2026 proposes to streamline fast-track merger provisions (Section 233 of the Companies Act), which would shorten timelines for qualifying transactions such as mergers between holding and wholly owned subsidiary companies.

Document and Covenant Drafting Checklist

To manage CCI risk in cross-border M&A India transactions, deal documentation should include the following provisions:

• CCI conditionality clause. Make closing expressly conditional on CCI approval (or deemed approval), with a long-stop date that accommodates the full 150-day review period plus a buffer for potential stop-the-clock events.
• Reverse break fee. Negotiate a reverse break fee payable by the buyer if CCI clearance is not obtained by the long-stop date, to protect the seller’s opportunity cost.
• Hold-separate undertaking. Include obligations preventing the buyer from exercising any operational control or influence over the target during the standstill period, this is critical to avoiding gun-jumping allegations.
• Information-sharing protocol. Define clean-team arrangements and information-barrier protocols for the exchange of competitively sensitive data during pre-closing integration planning.
• Escrow / deferred consideration. Where consideration includes deferred or contingent elements, ensure the DVT calculation methodology is documented and agreed between parties for CCI filing purposes.

Combination Filing Checklist, CCI Filings India: Forms, Evidence and Templates

The CCI accepts notifications through two forms: Form I (short form) and Form II (long form). The vast majority of transactions, particularly those with no material competitive overlaps, are filed using Form I. Form II is reserved for cases where the CCI requires a detailed competitive assessment, or where the parties anticipate Phase 2 scrutiny.

Form I (Short Form), Minimum Documents

A complete Form I filing requires the following as a minimum combination filing checklist:

1. Executed or substantially final transaction documents (SPA, SHA, merger scheme, as applicable)
2. Annual reports of the acquirer and target for the preceding three financial years
3. Board resolutions or equivalent authorisations approving the transaction
4. Details of the parties’ products and services, with revenue breakdowns by business segment
5. A description of horizontal, vertical and complementary overlaps (if any)
6. Market-share estimates for each overlap segment, identifying competitors and market boundaries
7. Details of any previous CCI filings by either party
8. A self-certification for Green Channel eligibility (if applicable)

Form II (Long Form), Expanded Evidence

Where Form II is required, the filing must additionally include independent market studies, customer and competitor contact lists, internal strategy and planning documents referencing the transaction rationale, and detailed economic evidence on market concentration (including HHI calculations). The CCI may also request production of correspondence between the parties relating to the competitive dynamics of the relevant markets.

Timing, Remedies and Common Pitfalls

Understanding the CCI’s review calendar is critical for deal-timeline management. The framework operates in two phases, with a deemed-approval safety valve.

Deemed Approval Mechanics and Stop-the-Clock

Phase 1 review runs for 30 calendar days from the date of a complete filing. If the CCI does not form a prima facie opinion within those 30 days, the combination is deemed approved. If the CCI identifies potential competitive concerns, it refers the matter to Phase 2, where the total review period, including Phase 1, is capped at 150 calendar days. The CCI may “stop the clock” if parties fail to respond to information requests within prescribed deadlines, effectively extending the review period. Remedies available to the CCI include approving the combination subject to binding commitments (behavioural or structural), requiring divestitures, or, in rare cases, prohibiting the transaction entirely.

Common Pitfalls, What Triggers Delays and Penalties

• Gun-jumping. Any step that constitutes consummation, including exercising voting rights, appointing directors, integrating operations or sharing competitively sensitive information outside a clean-team framework, before CCI approval can attract a gun-jumping India penalty of up to 1% of total turnover or assets, whichever is higher. Practical mitigation requires strict hold-separate arrangements and an information-barrier protocol from the date of signing.
• Incomplete market data. Filing Form I with vague market definitions or unsupported market-share estimates is the single most common cause of CCI queries, which extend the effective review period.
• Underestimating SBO. Foreign acquirers frequently underestimate whether the target has substantial business operations in India, particularly for digital platforms with Indian user bases, and fail to file, creating ex-post compliance exposure.
• Premature integration planning. Announcing or implementing integration milestones (brand consolidation, workforce restructuring, system migration) before approval is received constitutes gun-jumping regardless of whether the parties have filed.

M&A Tax Structuring and Budget 2026 Considerations

Tax structuring is not a sideshow to merger control in India, it is integral to deal design, particularly for cross-border transactions. Budget 2026 introduced adjustments to indirect transfer taxation under Section 9(1)(i) of the Income Tax Act, withholding obligations on payments to non-residents, and the treatment of carried interest for private equity fund managers, all of which influence how inbound M&A is structured.

Typical Tax Traps in Cross-Border Deals

• Indirect transfer tax. Offshore transfers of shares in entities that derive substantial value from Indian assets continue to trigger Indian capital-gains tax liability. The valuation evidence used for CCI filing (DVT calculation) should be consistent with the valuation used for income-tax purposes, discrepancies between the two are a common audit trigger.
• Withholding on consideration. Indian buyers are required to withhold tax on payments to non-resident sellers. Where the consideration includes deferred or contingent elements, the withholding obligation must be calculated on each tranche, creating cash-flow and escrow-design complications that should be addressed in the SPA.
• Carried interest and fund structuring. Budget 2026 adjustments to carried interest treatment affect the after-tax returns for PE fund managers, deal teams should model the impact on carry waterfalls before finalising fund-level structuring for Indian investments.
• Transfer pricing on intercompany arrangements. Post-acquisition integration that involves intercompany service agreements, IP licensing or cost-sharing arrangements requires arm’s-length pricing documentation from day one, and this documentation should be prepared in parallel with CCI filing to avoid post-closing compliance gaps.

Worked Examples and Model Clauses

Scenario A, Japanese PE acquires target with Indian subsidiary (DVT triggered). A Tokyo-based PE fund acquires 100% of a Singapore holding company whose sole asset is a 70% stake in an Indian technology company. Total consideration is INR 3,500 crore (including deferred earn-outs). The DVT of INR 2,000 crore is exceeded, the target has SBO in India, and a CCI filing is mandatory. The SPA includes a CCI conditionality clause with a 180-day long-stop date and a reverse break fee of 3% of enterprise value.

Scenario B, Asset purchase below thresholds. A German manufacturer acquires a single production facility in India from a domestic conglomerate. Total deal value is INR 800 crore. Neither the DVT nor the enterprise/group-level asset/turnover thresholds are breached. No CCI filing is required, but FDI compliance (automatic-route confirmation and RBI pricing guidelines) must still be completed. The asset-purchase agreement includes a representation that no CCI filing is required, supported by a threshold analysis workpaper.

Scenario C, Triangular merger with NCLT process. An Indian listed company merges with a wholly owned subsidiary through a scheme of arrangement under Section 232 of the Companies Act. The combined entity exceeds CCI thresholds. The company files with the CCI and simultaneously applies to the NCLT, with both approvals included as conditions precedent in the scheme. The fast-track merger provisions under Section 233, expected to be streamlined once the Corporate Laws (Amendment) Bill is notified, would have avoided the NCLT process entirely.

Sample conditionality clause: “Closing shall be conditional upon (i) the CCI having granted approval or the combination being deemed approved under Section 6(5) of the Competition Act, 2002; and (ii) the NCLT having sanctioned the Scheme, in each case without conditions that are materially adverse to the Buyer.

Conclusion

The merger control India regime in 2026 demands early, coordinated planning across CCI, FDI and NCLT tracks. With the Corporate Laws (Amendment) Bill poised to reshape restructuring mechanics and the DVT capturing an expanding range of cross-border transactions, deal teams that invest in rigorous threshold analysis, parallel filing strategies and compliant hold-separate arrangements will close faster and with significantly less regulatory risk. For a comprehensive comparative M&A perspective across Asian jurisdictions, the accompanying Hong Kong merger guide offers a useful benchmark.

This article is published for informational purposes only and does not constitute legal advice. Specific transactions require tailored analysis by qualified counsel familiar with the applicable regulatory frameworks.

Sources

1. Competition Commission of India, Merger Control Regime: 2.0
2. CCI, FAQ Book (English)
3. Baker McKenzie, Amendments to Merger Control and Dealmaking in India
4. AZB & Partners, Merger Control in India: Overview
5. LawSikho, CCI Merger Control India 2026 Guide
6. Nishith Desai Associates, CCI Merger Control FAQs Takeaways
7. Dentons Link Legal, Indian Merger Control Regime: Revamped & Refined
8. AZB & Partners, Notification of Cross-Border Mergers