- ABSTRACT:
De minimis exemptions, in competition law, are clauses that exclude transactions involving organizations with little market influence from the requirement that competition authorities notify and examine them. This paper analyses how businesses are using this loophole of the CCI rules to avoid regulatory scrutiny. This study illustrates the possibility of anti-competitive behaviour that could result from such gaps by examining a variety of corporate strategies, including the purchase of smaller businesses that are below the defined asset and turnover limits. It also discusses the effects of recent changes to the Competition Act that have broadened the de minimis exemptions and evaluates how they affect market dynamics, especially in the digital industry. The research also identifies significant flaws in the current CCI review procedure, in respect to De-minimis exemption which calls for reform to ensure effective oversight. This study tries to provide practical suggestions for improving regulatory efficacy while preserving an atmosphere that is favourable for company expansion by contrasting India’s strategy with comparable frameworks in other jurisdictions. The final objective of this research will be to supplement the current discourse on competition law and how the latter promotes ethics in business enterprise in India.
KEY WORDS:
- De Minimis Exemptions
- Competition Law in India
- Regulatory Gaps
- Competition Commission of India (CCI)
- Digital Market Transactions
Competition law is a powerful tool with which to ensure market justice and defeat monopolistic practices during times of acceleration in the dynamics of markets. The legal clause under this system, de minimis exemptions, which safeguards particular transactions or organizations from the prerogatives of inspection by competition authorities, basically creates the idea. The exclusion of such exemption, therefore, aims at giving assurance that only those critical transactions which could possibly have an influence on competition are subject to extensive scrutiny.
De minimis exclusions are rationalized on grounds of a proportionate balance of market supervision versus regulatory effectiveness. These clauses take away the burden from the competition authority by exempting transactions that little affect competition. This allows them to focus on greater, more significant matters, but the implications of digital markets and innovative business models have started to question its relevance and use[1].
India demonstrates compliance with international best practices as it has agreed to de minimis exemptions under the Competition Act, 2002. The current frameworks in place are challenged, however, by the evolving market environment of things such as “killer acquisitions” and transaction value thresholds. The time is proper to analyse de minimis exemption’s theoretical as well as its practical aspects that Indian regulators solve these issues working with changes similar to the ones introduced by Competition (Amendment) Bill 2023.
[1]Palmer, B. (2024, March 15). What the de minimis exemption means. Financial Advisor Practice Management.