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CS Executive · Economic, Commercial and Intellectual Property Laws · Competition Law

Zenith Pharma and Kaveri Labs notified a proposed merger to the Competition Commission of India. The Commission formed the opinion that the combination does not, and is not likely to, have an appreciable adverse effect on competition. What does Section 31(1) require the Commission to do?

The Commission must approve the combination by order. Section 31(1) provides that when a combination does not, or is not likely to, have an appreciable adverse effect on competition, it is approved. The power to block it arises only on an adverse finding.

  1. AApprove the combination by orderCorrect
  2. BDirect that the combination shall not take effect
  3. CFrame a scheme to be implemented by the parties
  4. DDeclare the combination void

Explanation

Under Section 31(1), where the Commission is of the opinion that a combination does not, or is not likely to, have an appreciable adverse effect on competition, it approves the combination by order. Directing that it not take effect applies under Section 31(2) only where an appreciable adverse effect exists or is likely.

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