Notice given by Glenmark Generics Limited, Glenmark Access Limited and Glenmark Pharmaceuticals Limited — Combination C-2014/02/156
- Case No.C-2014/02/156
Ratio decidendi
The rule this decision rests on
A combination falling within item 9 of Schedule I to the Combination Regulations, namely a merger where one enterprise holds more than fifty per cent of the shares or voting rights of the other (or where both are held more than fifty per cent by enterprises in the same group), is ordinarily not likely to cause an appreciable adverse effect on competition, so that notice under section 6(2) need not normally be filed. The exemption is lost where the transaction results in a transfer from joint control to sole control. Where the combination falls within that category and no change in ultimate control results, the Commission may approve it under section 31(1) of the Act. Such approval stands revoked if the information furnished by the acquirers is later found to be incorrect.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
1. On 26th February, 2014, the Competition Commission of India (hereinafter referred to as the “Commission”) received a notice under sub-section (2) of Section 6 of the Competition Act, 2002 (hereinafter referred to as the “Act”), given by Glenmark Pharmaceuticals Limited (hereinafter referred to as “GPL”), Glenmark Access Limited (hereinafter referred to as “GAL”) and Glenmark Generics Limited (hereinafter referred to as “GGL”). The notice was filed pursuant to the resolutions passed by the respective Board of Directors of GPL, GAL and GGL on 31st January 2014.
2. GPL is a listed company incorporated under the provisions of the Companies Act, 1956. As per the information given in the notice, it is engaged in the business of manufacture, sale and distribution of branded generic products. GPL holds 100 per cent and 98.14 per cent shareholding of GAL and GGL respectively. GAL holds 1.19% shareholding of GGL. GAL, a company incorporated under the provisions of the Companies Act, 1956, is principally engaged in the business of exporting pharmaceutical products and as per the information given in the notice, GAL does not currently have any business operations. GGL, a company incorporated under the provisions of the Companies Act, 1956, is primarily engaged in the business of pharmaceutical formulations and active pharmaceutical ingredients (APIs).
COMPETITION COMMISSION OF INDIA Fair Competition For Greater Good
3. As per regulation 4 of the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011(hereinafter referred to as “Combination Regulations”), the categories of combinations mentioned in Schedule I are ordinarily not likely to cause an appreciable adverse effect on competition in India, and accordingly, the notice under sub-section (2) of section 6 of the Act need not normally be filed. As per the Item 9, to the Schedule 1 of the Combination Regulations - “A merger or amalgamation of two enterprises where one of the enterprises has more than fifty per cent (50%) shares or voting rights of the other enterprise, and/or merger or amalgamation of enterprises in which more than fifty per cent (50%) shares or voting rights in each of such enterprises are held by enterprise(s) within the same group: Provided that the transaction does not result in transfer from joint control to sole control”
4. It is therefore, noted that the proposed combination falls under item 9 to Schedule I to the Combination Regulations and that there would be no change in the ultimate control as a result of the proposed combination. The Commission hereby approves the same under sub-section (1) of Section 31 of the Act.
5. This order shall stand revoked if, at any time, the information provided by the Acquirers is found to be incorrect.
6. The Secretary is directed to communicate to the parties to the Combination accordingly.
(Ashok Chawla) Chairperson
COMPETITION COMMISSION OF INDIA Fair Competition For Greater Good (Anurag Goel) Member (M. L. Tayal) Member (S.L. Bunker) Member
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