New Delhi: The government on Monday formally moved a Bill to amend the Competition Act of 2002, which seeks to give more teeth to the Competition Commission of India (CCI), the country’s anti-trust watchdog.

A Bill to amend various facets of the Act was introduced in the Lok Sabha by Sachin Pilot, junior minister for corporate affairs. It will have to be passed by both houses of Parliament before it comes into force.

The Act, once enforced, will give the CCI chairman direct powers to order search and seizure operations. The commission’s investigation wing now has to get the approval of a chief metropolitan magistrate for this.

“Direct search and seizure would mean that gathering evidence would be faster and that investigations would be kept confidential," said Manas Kumar Chaudhuri, a partner at law firm Khaitan and Co. “This amendment will give the commission substantial powers to go after cartels."

Chaudhuri further said that this provision was in line with international norms. “This is a good provision. Information on search and seizure often leaks. This will help," said M.M. Sharma, head, competition law and policy, Vaish Associates Advocates.

The new Bill, when passed, would make it mandatory for the competition panel to decide on corporate mergers and acquisitions (M&A) within a stipulated time limit of 180 days. The current stipulation is 210 days.

The new amendments also include changes to definitions of technical terms such as “group" and “turnover" in matters related to competition.

The government has added a new part to Section 5 of the Act, which deals with business combinations of corporate entities. The new Section 5A gives the central government the power to specify different values of assets and turnover for scrutinizing combinations.

“Notwithstanding anything in Section 5, the central government may, in consultation with the commission, by notification, specify different values of assets and turnover for any class or classes of enterprise for the purpose of Section 5," the newly inserted section 5A reads.

Simply put, the threshold limits for deciding on which M&A deals need to be scrutinized by CCI would now be decided by the government sectorally. It would cover M&As in sectors such as pharma, where deal sizes are small, and they escape the purview of the competition regulator.

CCI can currently only scrutinize M&As in which the combined turnover of the acquirer and the company being acquired is 4,500 crore or more and 1,500 crore or more in terms of assets.

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