NEW DELHI, Jan 1: As CCI gears up for scrutiny of changing business models to ensure a level-playing field among competitors, its Chairman Ashok Chawla feels that the fast-changing technology landscape and complex M&A deals can make competition assessments much more difficult, going ahead.
In recent times, the Competition Commission of India (CCI) has come across complaints and cases pertaining to app-based services, e-commerce and use of interface having intellectual property, among others.
Noting that the technological landscape is changing fast, the CCI chairman said areas such as e-commerce and app-based services will become more prominent.
“So, it will move speedily from brick-and-mortar kind of competition assessment to an assessment that goes into the areas of, necessarily difficult, new technologies. That will be a challenge the Commission will have to gear up to,” Chawla told PTI in an interview.
Under Chawla, who has been at the helm since October 2011 and is retiring this month, the regulator has dealt with a significant number of cases spread across diverse sectors, including realty, infrastructure, technology and aviation.
With respect to the mergers and acquisitions, the Commission has so far cleared more than 360 proposals while only three deals have been subject to public scrutiny.
In two of the deals — Sun Pharma-Ranbaxy and Holcim-Lafarge — where detailed scrutiny was undertaken, the Commission asked the entities to divest certain assets in order to address competition concerns. The latest one put up for public scrutiny is PVR Cinemas’ proposed acquisition of DT Cinemas in a Rs 500-crore transaction.
“I think it (M&As) will slowly start moving beyond the innocuous consolidation and beyond the intra-group merger, which have been there quite a bit in the past, to more complex M&As which will necessarily stress the capabilities of the Commission,” he emphasised.
So far, detailed assessments were carried out in just 1-2 per cent of the total M&A cases and Chawla feels that this number will go up to 5-7 per cent or more over the next five years.
Further, he said the number of cases received by the Commission on the behavioural side will increase.
Presently, the regulator gets about 100 cases every year, but in a majority of cases, it has found that they do not fall under the ambit of the competition regulations.
“Both in terms of numbers and the types of complaints, I think there will be (an increase)… I see many more complaints coming in. So, I think the tendency among businesses of not complaining against each other and stopping shy of that will probably change,” Chawla noted.
He also said the Commission will be happier to see cases which are clearly in the ambit of competition law coming to it, rather than those in the nature of contractual or consumer disputes. (PTI)
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