CCI Merger Control in India: Deal-Value Threshold and Filing Process Explained
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A deal worth more than ₹2,000 crore can now require CCI approval even if the target’s balance sheet looks unremarkable. That’s the deal-value threshold (DVT) at work, in force since 10 September 2024, and it has expanded the jurisdictional reach of India’s merger-control regime, particularly for high-value transactions involving targets with substantial Indian operations.
Before the DVT, merger control in India ran almost entirely on assets and turnover under Section 5 of the Competition Act, 2002. That worked fine for factories and manufacturing rollups. It worked less well for a fintech app with twenty million Indian users and a thin balance sheet. The DVT was built to catch exactly that kind of deal.
If you’re structuring an acquisition, a share swap, or even a foreign-to-foreign transaction with an India angle, there are three separate tests to run before assuming a deal doesn’t need CCI notification — and getting even one of them wrong can delay closing by months.
Quick answer:
A transaction needs CCI approval if it crosses the Section 5 thresholds (₹2,500 crore assets or ₹7,500 crore turnover, enterprise-level in India), or if its value exceeds ₹2,000 crore and the target has substantial business operations in India.
Filing uses Form I (₹30 lakh) or Form II (₹90 lakh). CCI has 30 calendar days to form an initial view, and the full review is capped at 150 days. You cannot close until approval comes through — closing early is a real, actively enforced violation, not a technicality.
What CCI Merger Control Actually Checks
CCI merger control is a pre-approval gate under Sections 5 and 6 of the Competition Act, run by the Competition Commission of India. Any qualifying acquisition, merger, or amalgamation has to clear CCI review before it closes — not after.
The question the CCI is asking is narrower than people expect: will this specific transaction cause an Appreciable Adverse Effect on Competition (AAEC) in any Indian market? It isn’t judging whether you overpaid, whether the deal makes strategic sense, or whether the valuation is fair. It’s asking whether the combined entity could end up with the power to raise prices, cut output, or squeeze out competitors.
Who Actually Needs to Run This Check
This isn’t just a concern for headline-grabbing acquisitions. It comes up for:
- PE and VC funds structuring exits or secondary sales above threshold levels
- Strategic buyers acquiring the Indian arm of a multinational group
- Boards approving domestic mergers or demergers, where CCI clearance runs alongside NCLT sanction
- Foreign-to-foreign deals where the target has real India revenue, users, or GMV, regardless of where the buyer or seller is based
- Digital and platform companies raising large funding rounds structured as share acquisitions
Skipping the check isn’t a paperwork oversight. Closing a notifiable deal before approval — gun-jumping — can cost 1% of the total turnover, assets, or transaction value of the combination, whichever is higher, under Section 43A, and the Act separately gives CCI powers to address a combination that causes an AAEC, including remedies under Section 31.
The Threshold Math: Section 5
The traditional test looks at combined assets or turnover. These numbers went up sharply — roughly 150% — on 7 March 2024, catching up with three decades of inflation the old figures hadn’t kept pace with.
Enterprise level, in India: notifiable if combined assets exceed ₹2,500 crore, or combined turnover exceeds ₹7,500 crore. Worldwide, the trigger is combined assets over USD 1.25 billion (including at least ₹1,250 crore in India) or combined turnover over USD 3.75 billion (including at least ₹3,750 crore in India).
Group level: India assets above ₹10,000 crore or India turnover above ₹30,000 crore. Worldwide, that rises to assets over USD 5 billion (at least ₹1,250 crore in India) or turnover over USD 15 billion (at least ₹3,750 crore in India). These figures come straight from CCI’s own 2026 advocacy booklet, so they’re worth citing exactly rather than rounding.
Cross either level and notification is triggered — which is why a fairly small target can still land in CCI review if it’s being folded into a large existing group.
Control Matters as Much as Size: The “Material Influence” Test
Here’s the part deal teams miss most often: hitting the threshold numbers is only half of it. The transaction also has to result in “control” — and the bar for what counts as control dropped in 2023.
The Amendment codified control as the ability to exercise material influence over a target’s management or strategic decisions — the lowest standard the CCI uses, below the “decisive influence” language courts and practitioners had leaned on before. Practically, a minority stake with a board seat or veto rights over budgets or key hires can itself be a notifiable combination, even without majority ownership.
The CCI published revised FAQs in May 2025 trying to draw a clearer line between control-conferring rights and standard investor-protection rights. It helps, but the assessment is still fact-specific. If you’re structuring a minority investment with any special governance rights, don’t skip the control analysis just because the deal size looks small.
The Deal-Value Threshold, Unpacked
What Counts Toward the ₹2,000 Crore
Section 5(d), added by the 2023 Amendment, is the DVT itself: if a transaction’s value — including deferred and contingent consideration — exceeds ₹2,000 crore, and the target has substantial business operations in India, notification is mandatory. It doesn’t matter what the target’s own assets or turnover look like.
Earnouts and milestone payments count toward this figure. That’s a common blind spot — deal teams sometimes calculate DVT off the upfront consideration alone and miss that a deferred payment schedule pushes the total over the line. Run this calculation at term-sheet stage, not after signing.
The Substantial Business Operations Test
This is what actually determines whether the DVT applies, and it splits by sector under Regulation 4(2) of the CCI Combinations Regulations, 2024:
- Non-digital businesses: India turnover 10% or more of global turnover and above ₹500 crore, or India GMV 10% or more of global GMV and above ₹500 crore
- Digital businesses: 10% or more of global users based in India, or 10% or more of global turnover/GMV coming from India — CCI’s FAQ treats the ₹500 crore floor differently for the digital-user limb, so don’t assume it applies the same way; check the current FAQ for the exact wording before relying on this for a borderline case
This is the test that catches asset-light targets — a company with a thin balance sheet but a large Indian user base can still trip the DVT purely on the SBO side.
De Minimis Exemption — and a Catch Worth Flagging
Small targets have historically escaped CCI notification through the de minimis exemption. Since March 2024, that’s meant targets with India assets under ₹450 crore, or India turnover under ₹1,250 crore.
Two things to know:
- De minimis doesn’t help once the DVT applies. A small, low-revenue target can still lose this protection if the deal value crosses ₹2,000 crore and the SBO test is met — modest assets and turnover don’t matter at that point.
- CCI’s own material is inconsistent on how long this exemption runs. The March 2024 notification (S.O. 1131(E)) states it applies for two years from publication — putting its stated expiry around 7 March 2026. But CCI’s 2026 Competition Advocacy Booklet still lists the same ₹450 crore/₹1,250 crore figures with no mention of a lapse or renewal. Don’t resolve that contradiction yourself — check the live notification against the transaction date before relying on it.
How to Actually File: Step by Step
- Pre-filing consultation — optional, worth doing for borderline cases. You can informally raise form selection or threshold questions with CCI officers before filing, useful when DVT applicability isn’t obvious.
- Pick your form. Form I (short form) suits deals with little or no overlap between the parties; Form II (long form) is for deals with real horizontal or vertical overlap. Form I costs ₹30 lakh to file, Form II costs ₹90 lakh — both non-refundable, so getting this choice right matters.
- Check Green Channel eligibility. If there’s no identifiable overlap — horizontal, vertical, or complementary — between the parties, the deal is deemed approved as soon as CCI acknowledges the filing, without a substantive review.
- Phase I review. Once a valid notice is in, CCI has 30 calendar days to form a prima facie view. Miss that window and the deal is deemed approved by default.
- Phase II, if it comes to that. Competition concerns push the review into a detailed investigation. The full process is capped at 150 calendar days, down from 210 before the 2023 Amendment, though information requests pause this clock.
- Standstill obligation. No transferring shares, assets, or control until approval lands. For most combinations there’s no longer a fixed deadline to file after signing — the obligation is simply not to close early. Open-offer and on-market share acquisitions are the exception, running on their own 30-day filing clock under a separate derogation route.
How This Plays Out in Practice
Illustrative scenario — not a specific client matter.
Say a mid-sized Indian consumer-tech company is being acquired by a larger domestic group in a deal worth over ₹2,000 crore. The target’s own assets and turnover sit comfortably below the Section 5 thresholds, so a deal team running only the traditional test might conclude no CCI filing is needed.
That conclusion would be wrong if the target’s user base or GMV clears the SBO thresholds. The DVT would apply regardless of the modest balance sheet, and the parties would need to file — most likely Form I, given limited market overlap — before they can close. This is precisely the scenario the DVT was designed to catch, and it’s worth running the SBO numbers early rather than assuming a small balance sheet means an exemption.
A 2026 Reminder on Disclosure: Amazon v. CCI
In May 2026, the Supreme Court ruled on a dispute that started with Amazon’s 2019 Form I filing for its investment in Future Coupons. CCI had approved that deal in 2019, then years later tried to reopen it, alleging Amazon hadn’t properly disclosed interconnected agreements tied to Future Retail — and imposed a ₹202 crore penalty plus a demand for a fresh Form II filing.
The Court set aside CCI’s order (Amazon.com NV Investment Holdings LLC v. Competition Commission of India, 2026 INSC 576), holding that CCI can’t use a penalty provision to indefinitely reopen a combination it already approved. Amazon won. But the practical lesson for anyone filing today isn’t about winning after the fact — it’s that CCI’s approval is only as good as what you actually put in the notice. Describe every interconnected agreement clearly at filing stage. Litigating the adequacy of a six-year-old disclosure is not a position you want to be in, even if you eventually win.
Common Mistakes Worth Avoiding
- Stopping at Section 5 — teams that only check assets and turnover miss the DVT and SBO tests entirely, and miss filings on asset-light targets as a result.
- Leaving out deferred consideration — earnouts and milestones count toward the ₹2,000 crore figure; excluding them understates deal value.
- Assuming de minimis is a blanket safety net — it isn’t, once the DVT is triggered, and its own current validity is worth double-checking.
- Picking the wrong form — Form I for a deal with genuine overlap invites CCI queries and a possible mid-review upgrade to Form II, costing time and, effectively, money.
- Treating approval as a formality — starting integration steps before the standstill lifts is gun-jumping, even when it’s informal or unintentional.
- Under-describing interconnected agreements in the original filing — as Amazon v. CCI shows, ambiguity here is exactly what gets relitigated years later.
Before You File: A Quick Checklist
- Have you calculated deal value including deferred and contingent consideration?
- Have you tested the target against Section 5 and the DVT/SBO test separately?
- Have you checked whether any minority stake or governance right could trigger the material influence control standard?
- Have you confirmed the de minimis exemption’s current validity, if you’re relying on it?
- Have you built CCI clearance into your closing conditions explicitly, not folded into generic “regulatory approvals” language?
Frequently Asked Questions
What is the current CCI deal-value threshold?
₹2,000 crore. A transaction above this value, including deferred consideration, needs CCI approval if the target has substantial business operations in India.
When did the deal-value threshold take effect?
10 September 2024, alongside the CCI (Combinations) Regulations, 2024.
Does de minimis still protect small targets if the DVT applies?
No. Once the DVT and SBO test are triggered, the de minimis exemption doesn’t apply regardless of the target’s own size.
Form I or Form II — what’s the difference?
Form I is for deals with little competitive overlap (₹30 lakh fee). Form II is for deals with real overlap needing closer review (₹90 lakh fee).
How long does CCI review take?
30 calendar days for an initial view; 150 calendar days total including any Phase II, though information requests pause the clock.
What’s the penalty for closing before approval?
Up to 1% of the total turnover, assets, or transaction value of the combination, whichever is higher, under Section 43A.
Is there still a fixed deadline to file after signing?
Not for most combinations — the rule is simply don’t close before approval. Open-offer and on-market acquisitions still have a 30-day filing clock.
What qualifies for Green Channel approval?
Deals with no horizontal, vertical, or complementary overlap between the parties get automatic clearance on filing acknowledgment.
Does the DVT apply to foreign-to-foreign deals?
Yes, if the target has substantial business operations in India — where the buyer or seller is based doesn’t matter.
Can a minority stake purchase need CCI approval?
Yes, if it comes with board seats, veto rights, or similar governance rights that amount to material influence under the current control standard.
Who files the notice?
The acquirer in an acquisition; both parties jointly in a merger; all parties in a joint venture.
Where This Leaves You
The practical shift is this: size on paper no longer tells you whether a deal needs CCI approval. A target can be small on the balance sheet and still require notification because of its user base, its GMV, or a governance right baked into the deal structure.
If your transaction is approaching ₹2,000 crore, or your target has meaningful India user numbers even on modest revenue, run the SBO and Section 5 tests side by side before you sign — not after. And if any part of the deal involves a minority stake with special rights, don’t assume it’s exempt just because no one’s taking majority control.
For help running these calculations against your specific transaction, contact Sapient Services Pvt. Ltd. at +91 9540162888 or valuation@sapientservices.com.
