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ARTICLE · 03 APRIL 2017

Small Targets Get Relief – MCA Notification Expands Applicability Of Small Target Exemption

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The Ministry of Corporate Affairs, Government of India notified significant amendments (Notification) on 27 March 2017 to the small target exemption (also known as the de minimis exemption), ...

IndiaCorporate/Commercial Law
Avaantika Kakkar
Avaantika Kakkar
Dhruv Rajain
Dhruv Rajain
Arunima Chatterjee
Arunima Chatterjee
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The Ministry of Corporate Affairs, Government of India (MCA) notified significant amendments (Notification) on 27 March 2017 to the small target exemption (also known as the de minimis exemption) (STE), expanding its scope to include mergers and amalgamations and clarifying that only the "true target" in case of asset acquisitions will now be considered for the purposes of determining the applicability of the asset and turnover thresholds under the Competition Act, 2002 (as amended) (Act).

The Notification takes effect as of 27 March 2017, which is the date of its publication.

This newsflash examines the changes and their impact.

THE STE AS IT STOOD EARLIER

Previously, the STE exempted only acquisitions of shares, voting rights or control from approval requirements under the Act if,

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