Merger control under the competition policy of India

The today's world is a competitive world due the impact of globalization. In India, Rao-Manmohan policy of economic reforms in 1991 introduced a competitive trend in the country by initiating policy of Liberalization, Privatization, and Globalization (LPG) in the economic sphere. The policy reforms of 1991 have increased the competition to a high level and the entry of MNCs (Multi National Companies) has further strengthened the competitive environment. To cope with this cut throat competition companies started using many strategies, merger and acquisition is also one of them. Mergers and acquisitions leads to reduction in competition due to the monopoly of the acquiring firm on the products. So, to curb this negative intention behind merger and acquisition other than the rightful objectives like growth, market penetration, economies of scale etc.; the Competition Act 2002, was introduced by the Government of India. The act provides rightful check on the merger process and this paper tries to explain the steps followed under the act to maintain the desired level of competition in the market.