Corporate Restructuring, Valuation and Insolvency · Regulation of Combinations

De Minimis and Exempted Combinations under the Competition Act

Updated 11 October 2026 · Fact-checked

Some combinations need no notice to the CCI. The de minimis exemption covers acquisitions of a small target in India, tested on the target's Indian assets or turnover. Other exempt categories are listed in Schedule I of the Combination Regulations. To solve a question, check the exemption first, then the deal value threshold, then notify if neither applies.

Understand Exemptions, De Minimis and Exempted Combinations

A combination that crosses the thresholds in section 5 must be notified to the Competition Commission of India (CCI) before it is completed. But not every deal that crosses the thresholds needs a filing. The law lets some deals skip notice because they pose little risk to competition. These are the exempted combinations.

There are three sources of exemption. First, section 6(7) says that, once the prescribed criteria are met, certain categories of combinations are exempt from the notice requirement under section 6(2) and the 150-day wait under section 6(2A). The categories are set out in the rules and regulations. The Combination Regulations list them in a Schedule (Schedule I), which you should know as the list of categories ordinarily not requiring notice. Second, the Central Government can exempt a class of enterprises or deals by notification under section 54. The de minimis (small target) exemption works this way: the Government notifies asset and turnover limits for the target in India. Third, section 6(9) says section 6 does not apply to a share subscription, financing facility or acquisition by a public financial institution, foreign portfolio investor, bank or Category I alternative investment fund, made under a covenant of a loan or investment agreement.

The de minimis idea is simple. If the target enterprise is small in India, the deal is unlikely to hurt competition, so no notice is needed. The test looks only at the target's assets in India and turnover in India. The notified limits have been revised from time to time and apply for a stated period. So always use the figures given in the question or the current notification. Do not rely on memory. The exemption is also not available where the deal value threshold in section 5(d) is met.

Do not confuse exempt deals with the green channel route in section 6(4) to 6(6). A green channel deal is still filed, but on a simple form. On filing and acknowledgement by the CCI it is deemed approved. If the declarations are materially incorrect, or the criteria are not met, the approval is void ab initio. An exempt deal needs no filing at all.

Why this matters: failing to notify a deal that needed notice can attract a penalty under section 43A. Wrongly assuming an exemption is therefore a costly error. In an answer, show the exemption test clearly and tie it to the facts.

Key rules to remember

Exemption from notice: Section 6(7): combinations meeting prescribed criteria and falling in the notified categories are exempt from section 6(2) notice and the section 6(2A) wait; The categories sit in the rules and regulations (Schedule I of the Combination Regulations). Name the category and check its conditions against the facts.
De minimis (small target) test: Exempt if target's assets in India ≤ notified asset limit OR target's turnover in India ≤ notified turnover limit; Notified by the Central Government under section 54. The limits are revised periodically, so use the figures in the question. Only the target is tested, not the acquirer.
De minimis does not cover large-value deals: If the deal value threshold in section 5(d) is met, the de minimis exemption is not available; Check deal value and the target's substantial business operations in India before relying on de minimis.
Lender and investor carve-out: Section 6(9): section 6 does not apply to share subscription, financing facility or acquisition by a public financial institution, foreign portfolio investor, bank or Category I AIF under a covenant of a loan or investment agreement; The acquisition must flow from a covenant in the loan or investment agreement.
Green channel (not an exemption): Section 6(4) to 6(6): notice on prescribed criteria, deemed approved on acknowledgement, void ab initio if incorrect or incomplete; If void, the parties may file a regular notice within thirty days of the CCI order, and no section 43A action is taken in that period.
Penalty for failing to notify: Up to 1% of the higher of total turnover, assets or deal value of the combination (section 43A); Applies when notice under section 6(2) or 6(4) is not given or section 6(2A) is breached.

How to solve Exemptions, De Minimis and Exempted Combinations questions

Use this order for any question asking whether a deal needs notice to the CCI.

1Identify the deal: acquisition, acquiring of control, merger or amalgamation, and the parties (acquirer and target).
2Check whether it crosses the section 5 thresholds or the deal value threshold. If it crosses neither, it is not a notifiable combination at all.
3Check whether the deal falls in an exempt category: the Schedule I categories under the Combination Regulations, or section 6(9) for lenders and investors acting under a covenant.
4Apply the de minimis test to the target alone: its assets in India or its turnover in India against the notified limits. Meeting either limit is enough.
5Confirm that the deal value threshold in section 5(d) is not met, because that takes away the de minimis shelter.
6If no exemption applies, state that notice is due under section 6(2) after board approval or signing of the agreement and before completion. Mention the 150-day wait in section 6(2A) and the green channel option if it fits.
7Conclude with the consequence: exempt means no filing; a missed filing risks a penalty under section 43A and the deal may be examined under section 6(1).

Quickest way: Four-question filter

When to use it: Use it for short MCQ-style parts inside a descriptive answer or a quick case check when time is tight.

Is the target small in India (assets or turnover under the notified limit)? If yes, de minimis may apply.
Is the deal value threshold met? If yes, de minimis fails.
Does a Schedule I category or section 6(9) fit? If yes, no notice.
Otherwise notify before completion, and state the section 43A risk.

Common mistakes in Exemptions, De Minimis and Exempted Combinations

Testing the acquirer or the combined entity under the de minimis exemption.
Students mix it up with the section 5 thresholds, which look at combined or group figures.
Fix: The de minimis test looks only at the target's assets in India or turnover in India.
Requiring both the asset limit and the turnover limit to be met.
The two figures appear together and students assume both must be satisfied.
Fix: The test is either/or. Meeting one limit is enough.
Applying de minimis to a high-value deal with a small target.
Students forget the deal value threshold added to section 5(d).
Fix: Check deal value first. If it meets the threshold and the target has substantial business operations in India, de minimis does not shelter the deal.
Treating the green channel as an exemption.
Both avoid a detailed CCI review, so they feel the same.
Fix: Green channel needs a filing and gives deemed approval, which is void ab initio if declarations are wrong. An exempt deal needs no filing.
Quoting limit figures from memory as permanent.
Notified limits are easy to memorise, but they are revised and apply for a stated period.
Fix: Use the figures in the question. Where none is given, say the limits are those notified by the Central Government under section 54 and in force on the date of the deal.
Ignoring section 6(9) for banks, PFIs, FPIs and Category I AIFs.
Students focus on size tests only.
Fix: Check who the acquirer is and whether the acquisition arises from a covenant of a loan or investment agreement.

Worked examples

Example 1

Aarav Industries Ltd proposes to acquire 100% of Kaveri Foods Pvt Ltd. Assume the notified de minimis limits are: target's assets in India ₹450 crore and turnover in India ₹1,250 crore. Kaveri Foods has assets in India of ₹600 crore and turnover in India of ₹1,000 crore. The deal value is ₹1,400 crore, below the deal value threshold of ₹2,000 crore. Does the deal need notice to the CCI?

Show the solution

The deal is an acquisition of shares and control. It could be a combination if the section 5 thresholds are met, so check exemptions.
The de minimis test uses the target alone. Asset limb: ₹600 crore is above ₹450 crore, so this limb is not met.
Turnover limb: ₹1,000 crore is not more than ₹1,250 crore, so this limb is met.
The test is either/or, so one limb is enough.
Deal value ₹1,400 crore is below ₹2,000 crore, so the deal value threshold is not met and the de minimis exemption is not lost.

Answer: The de minimis exemption applies on the turnover limb, so no notice is required under section 6(2). This assumes the stated limits are in force and no other facts defeat the exemption.

Example 2

Meridian Pharma Ltd (combined assets of the parties ₹3,000 crore, combined turnover ₹4,000 crore) completes the acquisition of Tara Digital Pvt Ltd for ₹2,500 crore without telling the CCI. Tara's Indian assets and turnover are below the de minimis limits, but it has substantial business operations in India. The deal value threshold is ₹2,000 crore. Is the deal exempt? What is the maximum penalty?

Show the solution

Tara is small on assets and turnover in India, so de minimis looks available at first.
But the deal value of ₹2,500 crore is above ₹2,000 crore and Tara has substantial business operations in India, so the deal value threshold in section 5(d) is met.
When that threshold is met, the de minimis exemption is not available.
No other exemption is given in the facts, so notice was required before completion, and the section 6(2A) wait applied.
Under section 43A, the penalty may extend to 1% of the higher of total turnover, assets or deal value. Turnover ₹4,000 crore, assets ₹3,000 crore, deal value ₹2,500 crore. The higher is ₹4,000 crore.
1% of ₹4,000 crore = ₹40 crore.

Answer: The deal is not exempt. Failing to notify is a breach, and the CCI may impose a penalty of up to ₹40 crore under section 43A, on these assumed figures.

Exam tips

Begin with the exemption test, then the deal value check, then the notice requirement. This order mirrors how the CCI reasons and earns marks for structure.
If a question gives the limits, apply them to the target's India figures only. If it does not, say the limits are those notified under section 54 and in force at the time.
Contrast exempt, green channel and regular notice in one line each. Examiners like the distinction.
Quote section 6(7), 6(9), 54 and 43A where relevant, and finish with a clear conclusion on whether notice is needed.
For Schedule I categories, name the category and check its conditions against the facts instead of listing everything.

Practice questions from Regulation of Combinations

Exemptions, De Minimis and Exempted Combinations: frequently asked questions

What is the de minimis exemption under the Competition Act?

It exempts an acquisition from CCI notice when the target's assets in India or turnover in India are below the limits notified by the Central Government under section 54. Only the target is tested. The limits are revised from time to time.

Do both the asset limit and the turnover limit have to be met for de minimis?

No. Meeting either one is enough, so a target with assets above the limit but turnover below it can still qualify. Check the current notification for the figures.

Does de minimis apply if the deal value is very high?

No. If the deal value threshold in section 5(d) is met and the target has substantial business operations in India, the de minimis exemption is not available and the deal must be notified.

What is the difference between an exempt combination and a green channel filing?

An exempt combination needs no notice to the CCI. A green channel combination is filed under section 6(4) and, once acknowledged, is deemed approved. That approval is void ab initio if the information is materially incorrect or incomplete.

What happens if I wrongly assume an exemption and do not file?

The CCI may impose a penalty under section 43A of up to 1% of the higher of total turnover, assets or deal value of the combination. The combination can also be examined under section 6(1) for appreciable adverse effect on competition.