The Competition (Amendment) Act, 2023 (Act No. 9 of 2023, which received Presidential assent on 11 April 2023) is the first comprehensive overhaul of the Competition Act, 2002 in over two decades. Born out of the Competition Law Review Committee Report (2019) and shaped by the Parliamentary Standing Committee on Finance, the amendment recalibrates almost every limb of the statute: it introduces a transaction-value-based merger trigger to catch digital deals, slashes the time the Competition Commission of India (CCI) takes to clear combinations, codifies hub-and-spoke cartels, expands penalties to global turnover, creates a settlement and commitment route to cut litigation, and decriminalises a swathe of compliance defaults. For judiciary and CLAT-PG aspirants, this is the single most heavily examined development in competition law, and it must be read alongside the substantive provisions on anti-competitive agreements and abuse of dominant position that it amends.
Why the 2023 amendment was needed
The Competition Act, 2002 was drafted for an economy of factories, asset-heavy enterprises and conventional product markets. By the late 2010s its assumptions had been overtaken by the platform economy, where the most valuable acquisitions involve digital firms with negligible assets and modest revenues but enormous user bases and data troves. Under the original Section 5, the jurisdictional triggers for notifying a combination to the CCI were purely asset-and-turnover based, so a multi-billion-rupee acquisition of a nascent technology company would escape review simply because the target's balance sheet was thin. So-called "killer acquisitions" - where an incumbent buys out a fledgling rival to neutralise future competition - slipped through entirely.
The Competition Law Review Committee (CLRC), constituted by the Ministry of Corporate Affairs in 2018 and chaired by the then Secretary, submitted its report in 2019 recommending a transaction-value threshold, a settlement and commitment framework, a dedicated governing board for the CCI, and the codification of buyer cartels and hub-and-spoke arrangements. The Competition (Amendment) Bill, 2022 was introduced and referred to the Parliamentary Standing Committee on Finance, which made further suggestions. The Bill was passed by the Lok Sabha on 29 March 2023 and the Rajya Sabha on 3 April 2023, becoming the Competition (Amendment) Act, 2023 on 11 April 2023. Several provisions were brought into force in tranches through 2023 and 2024, with the keenly awaited deal value threshold becoming operative on 10 September 2024.
The deal value threshold: catching the digital deals
The headline reform is the insertion of a fourth, transaction-value-based limb into Section 5 through new Section 5(d). A combination must now be notified to the CCI for prior approval where the value of any transaction - in connection with acquisition of control, shares, voting rights or assets, or a merger or amalgamation - exceeds Rs 2,000 crore, provided the enterprise being acquired, merged or amalgamated has substantial business operations in India. The transaction value is computed inclusively: it captures every form of consideration - direct, indirect, deferred and otherwise - including amounts payable for non-compete obligations, technology assistance, intellectual property and call options.
The phrase "substantial business operations in India" is the gatekeeper that prevents the threshold from sweeping in deals with no Indian nexus. The contours were fleshed out by the CCI through the Competition Commission of India (Combinations) Regulations, 2024, which use proxies such as the number of Indian users, subscribers, visitors or customers, and the proportion of the target's gross merchandise value or turnover attributable to India (typically a 10 per cent test). The deal value threshold is conceptually borrowed from Germany and Austria, both of which adopted transaction-value triggers in 2017 precisely to capture digital acquisitions. The Indian provision is, however, distinctive in coupling the value test with the substantial-operations qualifier, which functions as a local-effects filter and keeps the regime from over-reaching into transactions with no real Indian footprint.
A safe harbour continues to operate alongside the new trigger. Under the de minimis or "small target" exemption framed under Section 54, a combination remains exempt from notification where the target enterprise has assets below the prescribed value or turnover below the prescribed value in India, regardless of deal size - the thresholds being revised periodically by the Central Government. The interaction between the deal value threshold and this exemption is a live area of practice, because a high-value acquisition of a small Indian target may now be caught by Section 5(d) even where it would once have qualified for the small-target exemption, depending on how "substantial business operations" is satisfied. For the definitions of "enterprise", "turnover" and "relevant market" that underpin all of this, see our note on key definitions.
Faster merger review and the new timelines
A persistent industry complaint was that combination clearance took too long, chilling deal-making. The amendment compresses the review timeline materially. The overall outer limit within which the CCI must pass an order on a combination is reduced from 210 days to 150 days from the date of notice. More significantly, the period within which the CCI must form its prima facie opinion on whether a combination causes or is likely to cause an appreciable adverse effect on competition (AAEC) is reduced from 30 working days to 30 calendar days, and a deemed-approval consequence follows: if the CCI does not form a prima facie opinion within that window, the combination is deemed to have been approved.
The standstill obligation - the bar on consummating a combination before approval, the backbone of India's suspensory regime - is retained but softened by new Section 6A, which permits open offers and on-market purchases of shares on a regulated stock exchange to proceed before approval, subject to two conditions: the acquirer must give notice to the CCI in the prescribed manner, and it must not exercise any ownership, beneficial rights or interest (such as voting rights or dividends) in those shares until the combination is approved. The discipline of the prima facie standard was settled long before the amendment in Competition Commission of India v. Steel Authority of India Ltd., (2010) 10 SCC 744, where the Supreme Court held that the formation of a prima facie opinion under Section 26(1) is an administrative, in-house function not requiring a hearing - a principle that continues to govern the compressed timelines.
Codifying hub-and-spoke cartels
Before 2023, the presumption of an AAEC under Section 3(3) of the Act applied to agreements between enterprises "engaged in identical or similar trade of goods or provision of services" - that is, classic horizontal competitors. This left a gap: a hub-and-spoke arrangement, in which competing retailers (the spokes) coordinate indirectly through a common supplier, distributor or platform (the hub) that shuttles commercially sensitive information between them, did not fit neatly within the language because the hub is not a horizontal competitor of the spokes. The amendment closes this gap by widening Section 3(3) so that an enterprise or person which is not engaged in identical or similar trade shall also be presumed to be a party to such an agreement if it participates, or intends to participate, in the furtherance of the agreement. This captures facilitators, intermediaries, platforms and agents.
The doctrinal foundation for treating vertically positioned entities as cartel facilitators was laid by the Supreme Court in Competition Commission of India v. Co-ordination Committee of Artists and Technicians of W.B. Film and Television, (2017) 5 SCC 17, where a coordination committee that was not itself a producer was nonetheless found to have orchestrated a concerted refusal to deal in the West Bengal film and television market, contravening Section 3(3). The 2023 amendment effectively statutorily entrenches the reasoning of that decision. Note, however, that the settlement and commitment route discussed below is not available for cartel contraventions, including hub-and-spoke cartels. For the broader framework of which this forms part, read our note on horizontal agreements.
Settlement and commitment: a new path to closure
One of the most consequential structural reforms is the creation of a settlement and commitment mechanism through new Sections 48A and 48B. The idea, drawn from the European Commission's commitment and settlement procedures and the United States consent-decree model, is to give enterprises a way to dispose of an investigation without a full adversarial contest, freeing CCI resources and providing businesses with certainty and finality.
The two routes operate at different stages. A commitment under Section 48B may be offered early - after the CCI has formed a prima facie view and directed an investigation, but before the Director General's investigation report is received. The enterprise offers behavioural or structural commitments to address the competition concern, and if accepted there is no finding of contravention and no penalty. A settlement under Section 48A is offered later - after the Director General's report has been received but before the CCI passes a final order - and typically involves payment of a settlement amount and acceptance of conditions, again avoiding protracted litigation and appeals. Crucially, both routes are confined to alleged contraventions of Section 3(4) (vertical agreements) and Section 4 (abuse of dominant position). They are expressly unavailable for cartels falling under Section 3(3). The detailed procedure is governed by the CCI (Settlement) Regulations, 2024 and the CCI (Commitment) Regulations, 2024.
Penalties on global turnover
Perhaps the change with the largest financial sting is the shift in the penalty base for anti-competitive agreements and abuse of dominance. The penalty ceiling under Section 27 - up to ten per cent of the average turnover of the preceding three financial years - is retained, but the amendment clarifies through an explanation that "turnover" means global turnover derived from all the products and services of the enterprise. This directly overrides the position that had prevailed since the Supreme Court's decision in Excel Crop Care Ltd. v. Competition Commission of India, (2017) 8 SCC 47 : AIR 2017 SC 2734.
In Excel Crop Care, the Supreme Court was confronted with a bid-rigging cartel among suppliers of aluminium phosphide tablets to the Food Corporation of India. The CCI had imposed penalties at nine per cent of the firms' total turnover under Section 27(b). The Court held that, on the doctrine of proportionality, "turnover" had to be read as relevant turnover - that is, turnover generated only from the products or services that were the subject of the contravention - and not the entire turnover of a multi-product enterprise. The 2023 amendment legislatively reverses this reading for the purpose of the penalty ceiling: the cap is now anchored to global, all-product turnover, although the CCI is expected to issue penalty guidelines (which it did in 2024) to structure the exercise of discretion and preserve proportionality in the actual quantum imposed. For the substantive law these penalties enforce, see abuse of dominant position.
Leniency Plus: incentivising disclosure of new cartels
The amendment imports the United States Department of Justice's Amnesty Plus concept into Indian law through changes to Section 46. The existing leniency regime already allowed a cartel member who approached the CCI with full, true and vital disclosure to receive a reduced penalty (the "lesser penalty" provision). The new Leniency Plus layer goes further: an applicant who is already cooperating in an existing cartel investigation can secure an additional reduction in the penalty payable in that first cartel if it discloses the existence of a second, hitherto undetected cartel in which it is also involved, and qualifies as a leniency applicant in that second cartel as well.
The policy logic is to destabilise cartels by turning every cartelist into a potential informant about its other arrangements - a firm that knows it can shave its penalty in cartel A by ratting out cartel B has a powerful incentive to come clean, and the mere possibility that a co-conspirator might do so makes every cartel less stable. This is the prisoner's-dilemma dynamic that underlies all modern leniency policy, now extended across cartels rather than confined to a single conspiracy. The mechanics are detailed in the CCI (Lesser Penalty) Regulations, 2024, which now expressly provide for the leniency-plus discount and prescribe how the marker system, the order of priority among applicants, and the quantum of reduction operate. This is examined in greater depth in our note on anti-competitive agreements.
A three-year limitation period for information
Before the amendment, there was no statutory limitation period for filing information or references alleging a contravention, which meant stale claims could be agitated years after the conduct. The amendment inserts a limitation requirement into Section 19: the CCI shall not entertain an information or a reference unless it is filed within three years from the date on which the cause of action arose. The provision is tempered by a proviso allowing the CCI to condone the delay if it is satisfied that there was sufficient cause for not filing within time, and it must record its reasons for doing so in writing.
This injects certainty and finality into enforcement, aligning competition law with the general scheme of limitation that governs civil proceedings, while preserving flexibility for genuinely meritorious late complaints. The absence of any limitation previously meant that enterprises faced open-ended exposure for historic conduct, which sat uneasily with the principle that stale claims should not be litigated indefinitely; the three-year cap restores that balance. For aspirants, the key examinable points are the three-year period, the trigger (the date the cause of action arose rather than the date of discovery), and the discretionary condonation power exercisable only on recorded reasons for sufficient cause.
Decriminalisation and the change in penalty language
In line with the Government's broader "decriminalisation of minor economic offences" agenda, the amendment converts a number of compliance defaults from criminal offences into civil contraventions. The statutory vocabulary is recalibrated throughout: words such as "offence" and "punishable with fine" are replaced with "contravention" and "liable to a penalty". The most prominent example is failure to comply with the orders or directions of the CCI - previously dealt with under provisions carrying imprisonment - which is now addressed through monetary penalties recoverable as civil dues.
The amendment also tightens the appellate route. An appeal to the National Company Law Appellate Tribunal (NCLAT) against an order imposing a monetary penalty under the Act now requires the appellant to deposit twenty-five per cent of the penalty amount as a pre-condition for the appeal to be entertained - a measure intended to discourage frivolous appeals filed merely to defer payment. These procedural changes operate alongside the substantive reforms and are frequently tested for their precise figures.
CCI governance and the Director General
The amendment makes two notable institutional changes. First, the office of the Director General (DG) - the CCI's investigative arm - is restructured: the DG, who conducts investigations under Section 26, is now appointed by the Competition Commission with the prior approval of the Central Government, rather than by the Central Government directly as under the unamended Section 16. This strengthens the institutional integration of investigation and adjudication while retaining a measure of executive oversight.
Second, the amendment empowers the CCI to frame regulations and issue guidelines on the determination of penalties and on the manner of computing turnover and income, lending transparency and predictability to enforcement. Together with the decriminalisation and settlement reforms, these governance changes reflect a deliberate move from a purely punitive posture towards a regulator that combines credible deterrence with negotiated, faster outcomes. The investigative function the DG performs remains anchored to the prima facie threshold articulated in CCI v. Steel Authority of India Ltd.
Vertical restraints and the settlement interface
Because the settlement and commitment routes are confined to Section 3(4) vertical agreements and Section 4 abuse of dominance, the amendment has the practical effect of channelling a large category of disputes - resale price maintenance, exclusive supply and distribution, tie-ins and refusals to deal - towards negotiated resolution rather than full contest. The leading Indian illustration of an actionable vertical restraint is the CCI's order in Fx Enterprise Solutions India Pvt. Ltd. v. Hyundai Motor India Ltd., where the Commission found that Hyundai had imposed resale price maintenance on its dealers, enforcing a discount control regime through mystery shopping and penalties, in contravention of Section 3(4)(e) read with Section 3(1).
Under the post-amendment regime, a similarly placed enterprise could potentially offer a commitment early in the proceedings - for instance, undertaking to cease the discount-monitoring practice - and avoid a finding of contravention altogether, or settle after the DG report by paying a settlement amount. This makes the rule-of-reason analysis that governs vertical agreements even more practically important, since the strength of the competition concern shapes the bargaining. For the analytical framework, see our note on vertical agreements and the rule of reason.
Exam takeaways and synthesis
For judiciary and CLAT-PG examinations, the Competition (Amendment) Act, 2023 should be memorised as a cluster of precise, examinable data points: it is Act No. 9 of 2023, assented to on 11 April 2023; the deal value threshold under Section 5(d) is Rs 2,000 crore with "substantial business operations in India", operative from 10 September 2024; the combination review timeline is cut from 210 to 150 days with a 30-calendar-day prima facie window and deemed approval; settlement and commitment under Sections 48A and 48B are available only for Section 3(4) and Section 4, not cartels; penalties under Section 27 are now on global turnover, overriding Excel Crop Care; the limitation period under Section 19 is three years; and a 25 per cent pre-deposit conditions appeals to the NCLAT.
The conceptual thread tying the reforms together is a shift from a slow, court-like, asset-focused regulator to a faster, settlement-oriented enforcer with global-scale deterrence and digital-economy reach. Read this note against the introduction to the Competition Act for the historical arc, and against anti-competitive agreements and abuse of dominant position for the substantive law the amendment refines.
Frequently asked questions
What is the deal value threshold introduced by the Competition (Amendment) Act, 2023?
New Section 5(d) requires a combination to be notified to the CCI where the value of the transaction exceeds Rs 2,000 crore and the target has substantial business operations in India. It became operative on 10 September 2024 and is designed to capture asset-light digital acquisitions that escaped the earlier asset-and-turnover triggers.
Did the amendment change how penalties are calculated?
Yes. The penalty ceiling under Section 27 is now anchored to global turnover from all products and services, not just the relevant product. This statutorily overrides the Supreme Court's ruling in Excel Crop Care Ltd. v. CCI, (2017) 8 SCC 47, which had read "turnover" as relevant turnover on grounds of proportionality.
What are the settlement and commitment mechanisms, and when do they apply?
Sections 48A (settlement) and 48B (commitment) let enterprises resolve cases without full litigation. A commitment is offered early, before the Director General's report; a settlement is offered after the report but before the final order. Both are available only for Section 3(4) vertical agreements and Section 4 abuse of dominance - never for cartels under Section 3(3).
How does the amendment deal with hub-and-spoke cartels?
Section 3(3) is widened so that an enterprise not engaged in identical or similar trade is also presumed to be a party to an anti-competitive agreement if it participates, or intends to participate, in furthering it. This captures facilitators, platforms and intermediaries - statutorily entrenching the reasoning in CCI v. Co-ordination Committee of Artists and Technicians of W.B. Film and Television, (2017) 5 SCC 17.
What is the limitation period for filing information with the CCI after the amendment?
Section 19 now bars the CCI from entertaining information or a reference filed more than three years after the cause of action arose. A proviso allows the CCI to condone the delay for sufficient cause, recording its reasons in writing - injecting certainty while preserving flexibility for genuine late complaints.
What is Leniency Plus under the amended Section 46?
Leniency Plus lets a cartelist already cooperating in one investigation earn an additional penalty reduction in that cartel by disclosing a second, previously undetected cartel and qualifying for leniency there too. Modelled on the US Amnesty Plus regime, it is designed to destabilise cartels by turning members into informants about their other arrangements.