India's Competition Reforms Signal Maturity, But Execution Will Determine Impact

A Welcome Step Forward

India's decision to introduce deal-value-based merger control thresholds represents a significant step toward aligning the country's competition framework with global best practices. The rationale is sound and well-grounded in practical experience. India's technology sector has produced dozens of high-value acquisitions over the past decade in which targets had minimal revenue but commanded substantial acquisition premiums reflecting their strategic importance, user base, or data assets. Under the previous asset-and-turnover-based thresholds, many of these transactions flew entirely under the Competition Commission of India's radar, depriving the regulator of the opportunity to assess their competitive implications.

The reform addresses a genuine gap in India's merger control architecture and signals the country's commitment to maintaining a robust competitive environment as its economy grows and its technology sector matures.

The Execution Challenge

The concern, however, is practical rather than conceptual. The CCI is now responsible for reviewing a significantly larger volume of transactions, with credible estimates suggesting a 30-40% increase in merger control filings as deals that previously fell below the thresholds are now captured by the deal-value test. The Commission's ability to handle this increased workload efficiently, without introducing delays that undermine deal certainty, will be the true test of whether the reform achieves its objectives.

India's business environment is already characterized by a degree of regulatory complexity that can frustrate foreign investors and slow transaction execution. Multiple approvals from different agencies, sector-specific regulatory requirements, and occasionally unpredictable administrative processes are well-known features of the Indian deal landscape. If the expanded merger control regime becomes another source of delay and uncertainty, it could paradoxically dampen the very investment activity that the country is working so hard to attract.

The Timeline Question

The shortened Phase I review timeline of 20 working days is a positive signal of the CCI's intent to maintain efficiency even as its jurisdiction expands. However, this commitment is meaningful only if the Commission has the staff, expertise, and institutional resources to meet these deadlines consistently across the full range of transactions it will now review.

A compressed timeline paired with insufficient resources would be worse than a longer timeline administered competently. Rushed reviews that produce poor outcomes, or that force parties into extended Phase II investigations unnecessarily, would undermine confidence in the regime and create precisely the kind of uncertainty that the reforms were designed to reduce.

Building Sectoral Expertise

The CCI should also invest significantly in building institutional expertise for technology sector transactions, which present unique challenges in market definition, competitive effects analysis, and innovation assessment. Technology markets frequently defy traditional analytical frameworks based on revenue share or price effects, and regulators worldwide have struggled to adapt their tools to the dynamics of platform competition, data-driven business models, and ecosystem effects.

India's technology sector is among the most dynamic in the world, and the transactions it produces will increasingly require sophisticated analysis that goes beyond conventional merger assessment methodologies. The CCI would benefit from establishing a dedicated technology unit staffed by economists and analysts with deep sectoral knowledge, following the model adopted by competition authorities in the European Union and the United Kingdom.

The Bottom Line

India's competition reforms are conceptually sound and strategically important. They reflect a maturing regulatory framework that is evolving to address the realities of a modern, technology-driven economy. But the gap between policy aspiration and operational execution is where reforms succeed or fail. The CCI's ability to deliver timely, well-reasoned, and predictable decisions under its expanded mandate will determine whether this reform strengthens India's position as an investment destination or adds another layer of complexity to an already challenging regulatory environment.

The international dealmaking community will be watching closely. Early signals from the reformed regime will set expectations for years to come.