Jointly by M/s UBS Group AG, Switzerland and M/s Credit Suisse Group AG, Switzerland — Combination C-2023/04/1024

Notice under Section 6(2) of the Competition Act, 2002 jointly filed by UBS Group AG and Credit Suisse Group AG

CORAM:

Ms. Sangeeta Verma Acting Chairperson

Mr. Bhagwant Singh Bishnoi Member

Order under Section 31(1) of the Competition Act, 2002

1. On 26.04.2023, the Competition Commission of India (Commission) received a notice under sub-section (2) of Section 6 of the Competition Act, 2002 (Act). The notice has been given pursuant to the merger agreement dated 19.03.2023 (and amended on 06.04.2023) executed between UBS Group AG (UBS) and Credit Suisse Group AG („Credit Suisse’) (Hereinafter, UBS and Credit Suisse are collectively referred to as the „Parties’).

2. The Proposed Combination involves the proposed acquisition of Credit Suisse by UBS by way of an absorption merger, with UBS being the surviving legal entity („Proposed Combination’). As part of the absorption, all Credit Suisse‟s assets, liabilities, and contracts will be transferred to UBS in their entirety and Credit Suisse will cease to exist as a separate legal entity by operation of law upon completion of the Proposed Combination. Therefore, UBS shall acquire complete control over Credit Suisse post completion of the Proposed Combination.

Combination Registration No. C-2023/04/1024

3. In addition to the information provided in the notice, certain additional information was provided by the Parties vide submission dated 10.05.2023.

4. UBS is a multinational investment bank and financial services company founded and based in Switzerland, and active globally. UBS is the ultimate controlling entity for the group. UBS‟ businesses comprise wealth management, asset management, investment banking services, and retail and corporate banking. In India, UBS‟s business is primarily focused on brokerage services.

5. UBS‟s subsidiary, UBS Securities India Private Limited („UBS Securities’) is registered as a trading member (cash/equity and equity derivatives segment) and trades on the National Stock Exchange of India Limited (NSE) and the BSE Limited (BSE). It, inter alia, provides brokerage services. UBS‟s indirect subsidiary, UBS Business Solutions (India) Private Limited („UBS Business Solutions’), provides business and technology process outsourcing services and vendor management, Information Technology (IT) and IT Enabled Services (ITES) to its overseas affiliates and these services are entirely within the group (i.e., captive).

6. Credit Suisse is a multinational investment bank and financial services company founded and based in Switzerland. Credit Suisse is active globally and its businesses comprise wealth management, asset management, investment banking services, and retail and corporate banking. In India, Credit Suisse‟s businesses comprise wealth management, investment banking, and financial market services. Credit Suisse‟s subsidiaries/branches in India for FY 21-22 are: (i) Credit Suisse Business Analytics (India) Private Limited („CS Business Analytics’); (ii) Credit Suisse Business Management (India) India Private Limited („CS Business Management’); (iii) Credit Suisse Finance (India) Private Limited („CS Finance’); (iv) Credit Suisse Securities (India) Private Limited („CS Securities’); (v) Credit Suisse Services (India) Private Limited („CS Services’); (vi) Credit Suisse Services AG Pune Branch („CS Services Pune’); and (vii) Credit Suisse AG Mumbai Branch („CS Bank Mumbai’).

Combination Registration No. C-2023/04/1024

7. Credit Suisse‟s bank branch in Mumbai, i.e., CS Bank Mumbai, is registered as a foreign bank in India and provides banking facilities to its clients. Credit Suisse is active in the financial services sector through CS Securities, which is, inter alia, registered with SEBI for offering stock brokerage services. Credit Suisse is also present in the financial services space through its indirect subsidiary CS Finance, which is a registered Non-Banking Finance Company (NBFC) in India and provides lending services to investment banking clients and wealth management clients. Further, Credit Suisse‟s indirect subsidiaries, CS Business Analytics, CS Services Pune, CS Business Management, and CS Services, provide various business support services, including information services and IT and ITES to Credit Suisse group entities in and outside India. These services are entirely within the group (i.e., captive).

8. In relation to the identification of overlaps, the Parties have submitted that they exhibit overlap only in brokerage services (subset of the financial market services sector) and its sub-segments, i.e., (i) brokerage services in cash/equity segment and (ii) brokerage services in equity derivatives segment. Further, it is submitted that the relevant geographic market for all the services offered by Parties may be considered as national in scope, i.e., India. Accordingly, the relevant market is identified as the “market for brokerage services in India” („Relevant Market’), which includes the segments of (i) brokerage services in cash/equity segment in India; and (ii) brokerage services in equity derivatives segment in India.

9. Further, it is submitted that though both UBS (through UBS Business Solutions) and Credit Suisse (through CS Business Analytics, CS Services Pune and CS Services) in India provide IT and ITES services to their respective group companies. However, UBS and Credit Suisse do not provide IT and ITES services to any third parties. Therefore, these services are completely captive. Accordingly, no horizontal or vertical overlaps arise between the Parties on account of the IT and ITES services in India.

10. The Commission decided to assess the Proposed Combination in the segments identified by the Parties. However, exact delineation of the relevant market has been Combination Registration No. C-2023/04/1024 left open as the material available on record does not suggest that the Proposed Combination is likely to cause any competition concern in India.

11. Based on the submissions of the Parties, it is noted that the combined market share of the Parties as well as the incremental market share in the Relevant Market (including sub-segments) is in the range of [0-5]%, both in terms of volume and value. Further, the Relevant Market (including sub-segments) is characterized by the presence of other players such as Zerodha Broking Limited, RKSV Securities India Private Limited (Upstox), Nextbillion Technology Private Limited (Groww), Angel One Limited, and ICICI Securities Limited. Further, it is stated that, as per SEBI data, there are 5324 brokers registered in the cash segment and 3703 brokers registered in the equity derivatives segment.

12. Considering the material on record, including details provided in the notice given under Section 6(2) of the Act and assessment of the combination based on the factors stated in Section 20(4) of the Act, the Commission is of the opinion that the Proposed Combination is not likely to have any appreciable adverse effect on competition in India in any of the relevant market(s), and therefore, the Commission approves the same under Section 31(1) of the Act.

13. This order may stand revoked if, at any time, the information provided by the Acquirer is found to be incorrect.

14. The information provided by the Parties shall be treated as confidential in terms of and subject to provisions of Section 57 of the Act.

15. The Secretary is directed to communicate to the Parties accordingly.