Welcome to the June 2025 edition of Phoenix Legal's Competition Monthly. This issue captures key enforcement, merger control developments and regulatory updates in the antitrust and competition space during the last calendar month.
SUPREME COURT GIVES FIRST DETAILED JUDGMENT ON ABUSE OF DOMINANCE
The Supreme Court, by its order dated 13 May 2025, dismissed appeals challenging a Competition Appellate Tribunal order that had overturned penalties imposed by the Competition Commission of India (CCI) on Schott Glass India Pvt. Ltd. (Schott India). In this case, the Court considered whether Schott India, a dominant manufacturer of glass tubes, had abused its dominance by, inter alia, providing higher discounts to a related purchaser (Schott Kaisha Pvt. Ltd.), vis-à-vis other purchasers. The Court also dealt with legality of various commercial transactions by enterprises, such as tying-in, volume discounts, and margin squeeze.
On Schott India's target-discount scheme: The Court upheld volume-based discounts as a valid commercial practice, holding that differential pricing is abusive only when materially equivalent transactions receive unjustified differential treatment. Discounts open to all similarly placed buyers cannot be deemed discriminatory.
On the Long-Term Tubing Supply Agreement (LTTSA): A margin squeeze requires the dominant entity to operate in both upstream and downstream markets, with pricing that renders downstream competition unviable for an equally efficient competitors and harms the market. The Court found Schott India was absent in the downstream market and noted positive margins for converters, ruling out anti-competitive harm.
On Tying or Bundling of Neutral Glass Amber (NGA) and Neutral Glass Clear (NGC) Tubes: The Court laid down that tying-in is attracted where the dominant enterprise (i) supplies two distinct products; (ii) makes the supply of the tying product conditional upon acceptance of the tied product; and (iii) thereby forecloses competitors in the tied product market. Schott India did not violate Section 4(d) of the Competition Act, 2002 (Act) as NGA and NGC are not independent products; converters were never compelled to buy both; no foreclosure was demonstrated; and, in any event, the rebate design was objectively justified.
On the Necessity of Effects-Based Analysis: The Court held that an effectsbased analysis is an obligatory component of every abuse of dominance inquiry. The omission of a proper harm analysis vitiates the order. The Court considered that establishing abuse of dominance necessarily requires assessment of the effects of the conduct, and mere assessment of dominance is not adequate.
Phoenix Legal Comment: This landmark judgment provides multiple novel defences for companies which have faced, or may face, abuse of dominance allegations. The Court recognises that the Act is not designed to humble successful enterprises, but only to preserve the process of competition. That being said, it is crucial that businesses review their existing policies to ensure that they do not contain any unjustified clauses that may amount to tying-in, margin squeeze, discriminatory pricing, or any practice which has been prohibited under the Act.
CCI APPROVES ACQUISITION OF KSK MAHANADI POWER COMPANY LIMITED BY JSW ENERGY LIMITED AND JSW THERMAL ENERGY ONE LIMITED
The CCI approved the proposed combination involving the acquisition of 100% shareholding and sole control over KSK Mahanadi Power Company Limited (Target) by JSW Energy Limited (JSWEL) through its wholly owned subsidiary, JSW Thermal Energy One Limited (JSW Thermal) (collectively referred to as Acquirers). The Target is currently undergoing insolvency resolution proceedings under the Insolvency and Bankruptcy Code, 2016.
The proposed transaction involves multiple inter-connected steps, including fund infusion by JSW Thermal into the Target, capital reduction of existing shareholding in the Target (except JSW Thermal's), merger of JSW Thermal into the Target, and issuance of 26% of the shareholding in the Target to its equity receiving creditors, and eventual acquisition of the remaining 26% shareholding by JSWEL through put and call options. Upon completion of all steps, JSWEL will hold 100% of the shareholding in the Target.
The Acquirers and the Target exhibit horizontal overlap in the market for generation of power in India (Power Generation Market), including narrower segments such as power generated through non-renewable sources and thermal energy (using coal). The combined market shares of the Acquirers and the Target in Relevant Power Generation Markets and Segments are in the range of [0–5] % in terms of installed capacity and [5–10] % in terms of value, with the presence of other significant competitors in the market.
The CCI also noted potential vertical relationships between the Target and certain portfolio companies of the JSW group, such as:
- Supply of lignite by Barmer Lignite Mining Company Limited (an affiliate of the JSW group) (upstream) and power generation by the Target (downstream);
- Trading of power by JSW Power Trading Company Limited (an affiliate of the JSWEL) (downstream) and power generated by the Target (upstream); and
- Power transmission by Jaigad Power Transco Limited (an affiliate of the JSWEL) (downstream) and thermal power generation by the Target (upstream).
However, in each case, the market presence of the parties in upstream and downstream segments is not significant and is subject to competitive constraints from other players.
Accordingly, the CCI concluded that the proposed combination is not likely to cause an appreciable adverse effect on competition in India, and approved the proposed combination.
CCI APPROVES ACQUISITION OF ADVANTA ENTERPRISES LIMITED BY ALPHA WAVE VENTURES II, LP
The CCI approved the proposed acquisition of 12.44% shareholding of Advanta Enterprises Limited (Target) by Alpha Wave Ventures II, LP (Acquirer), by way of (i) allotment of 3.51% equity shares by Target to Acquirer; and (ii) acquisition of 8.93% equity shares by Acquirer from UPL Limited.
Acquirer is a global private equity fund managed by Alpha Wave Ventures GP, a joint venture between Alpha Wave Global, LP (Acquirer Group 1) and Lunate Holding RSC Ltd. (Acquirer Group 2).
The CCI noted that affiliates of Acquirer Group 1 and Acquirer Group 2 exhibit potential complementary overlaps with the Target. The CCI noted that the activities of the Target (commercialisation of seeds) demonstrated complementary overlaps with the affiliates of Acquirer Group 1 (engaged in crop protection services); as well as the activities of Acquirer Group 2 (engaged in digital farming solutions). However, given the miniscule presence of the parties and/or their affiliates in the upstream and downstream markets, the CCI held that the proposed combination is not likely to have appreciable adverse effect on competition in India, and approved the proposed combination.
CCI APPROVES ACQUISITION OF AYANA RENEWABLE POWER PRIVATE LIMITED BY ONGC GREEN LIMITED AND NTPC GREEN ENERGY LIMITED
The CCI approved the proposed combination envisaging acquisition of 100% equity share capital of Ayana Renewable Power Private Limited (Target) by ONGC NTPC Green Private Limited (Acquirer).
The Acquirer is a recently incorporated 50:50 joint venture between ONGC Green Limited (part of ONGC Group) and NTPC Green Energy Limited (part of NTPC Group).
The Target group, NTPC Group, and ONGC Group are, inter alia, engaged in the power sector in India. The CCI noted that the parties exhibit horizontal overlaps in segment for generation and transmission of power, vertical/complementary overlaps also exist in areas such as (i) power generation and power transmission, (ii) power generation and power transformers, (iii) power generation and trading power, and (iv) power generation and repair and maintenance of power plants.
However, given the incremental market share of the parties in the markets is insignificant, the CCI held that the proposed combination is not likely to have appreciable adverse effect on competition in India, and approved the proposed combination.
REGULATORY UPDATE
On 20 May 2025, the CCI released a revised edition of the FAQs on combinations. The FAQs provide updated guidance on key areas of merger control for businesses and compliance professionals. Some of the important takeaways are as follows:
1. Clarifications with respect to combinations involving Insolvency and Bankruptcy Code (IBC) proceedings: IBC transactions are subject to the same notifiability criteria as other M&As and may be filed via the Green Channel if there are no overlaps. Where multiple applicants are involved, each must independently assess notifiability. If the transaction qualifies as a combination, CCI approval is required prior to the Committee of Creditors' approval under the IBC.
2. Clarifications with respect to "digital service" under Deal Value Threshold/ Substantial Business Operations in India: Digital services include services such as e-commerce platform services, cloud services, and online gaming. Merely using the internet as a distribution channel does not qualify a service as digital. Even if not the primary activity, any service delivered via the internet to end users may be treated as a digital service under the Competition Commission of India (Combinations) Regulations, 2024.
3. Group Definition– Material Influence Counts: The CCI clarifies that the definition of 'group' under the Competition Act includes entities over which an enterprise exercises material influence, even in the absence of 26% shareholding or board control. Accordingly, for assessing group-level thresholds, the assets and turnover of such entities must be taken into account.
4. Inter-connected Transactions- Filing as a Single Combination Is Mandatory: Acquisitions by different persons may be deemed inter-connected if they form part of a common investment strategy, inferred from factors such as simultaneity, mutual interdependence, or functional links, or internal consideration of investors. Separate agreements are not enough to conclude that the transactions are not interconnected. In such cases, a single notice must be filed, and all acquirers are required to be notifying parties unless exempted under the Competition Commission of India (Criteria for Exemption of Combinations) Rules, 2024.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
