Has Common Shareholding Become a Commonplace in CCI’s Assessment: Unveiling the Development of Common Shareholding in India

Abstract

In any part of the world, businesses observe evolution. The competition law strives to assure a level playing field for businesses and therefore, must evolve alongside. With the development of businesses, originates new tactics to impair competition in their favour. One of the most prevalent means to get incentivized from impairment of competition is cartelization. With businesses, cartelization has also evolved and now includes a mechanism wherein companies invest in each other and establish a shareholding relationship. As a result, they can meet or share information without raising suspicion of cartelization. It is essential for any competition authority to integrate such a mechanism into its examination. The paper analyses the development of common shareholding as a concept under the competition regime of India. As opposed to the common belief, it is found that the Competition Commission of India has led to significant development of common shareholding through its ex-post as well as ex-ante examinations. The paper further argues that referring to the Meru Case as the only point of reference for assessing the development of common shareholding is based on indifference. The paper highlights how the concept has developed in a veiled fashion. With regards to ex-post examination, the paper shall be deliberating on multiple cases wherein the Commission has applied the concept without even referring to the formal terminology. As for ex-ante examination, the paper shall be analyzing what relevance the Combination Regulation and the CCI attribute to the concept of common shareholding. The paper also deliberates on the challenges forthcoming in these examinations. The paper shall conclude that the competition law of India is witnessing the development of common shareholding in a veiled fashion.