Future Consumer Enterprise Limited
Case brief
What is this about?
The Competition Commission of India imposed a penalty on Future Consumer Enterprise Limited for failing to notify a combination and for consummating it before the statutory deadline. The Commission rejected the argument that a De Minimis Exemption applied to a specific business division rather than the parent enterprise, holding that regulatory obligations override competition assessments.
What did the court decide?
A penalty of INR 10,00,000 imposed on Future Consumer Enterprise Limited to be paid within 60 days.
What the court decided
A compact analysis
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
Fair Competition For Greater Good
COMPETITION COMMISSION OF INDIA (Combination Registration No. C-2016/03/384)
9th June, 2017
Order under Section 43A of the Competition Act, 2002 against Future Consumer Enterprise Limited in relation to Combination Registration No. C-2016/03/384
- On 21st March, 2016, the Competition Commission of India (“ Commission ”) received a notice given by Future Consumer Enterprise Limited (“ FCEL ” or “ Acquirer ”) for acquisition of consumer products division business (“ CPD Business ”) of Grasim Industries Limited (“ Grasim ”) by FCEL. (Hereinafter, FCEL and Grasim are collectively referred to as the “ Parties ”).
Background
- The Commission, on the basis of media report, initiated an inquiry into the abovesaid acquisition of CPD Business of Grasim by FCEL and vide its letter dated 20th August, 2015, directed FCEL to provide data / information on the asset and turnover of the Parties. Based on submission dated 15th September, 2015, of FCEL, the Commission took suo motu cognizance of the transaction and vide letter dated 7th January, 2016, issued direction to FCEL to file notice in Form I within stipulated time on receipt of the communication.
- FCEL, vide its letters dated 5th February, 2016 and 17th February, 2016, contended that the said transaction was exempt from any notification requirement owing to nominal assets and turnover of the CPD Business, and requested the Commission to recall its direction. The Commission noted the submissions of FCEL and vide letter dated 2nd March, 2016 directed FCEL to comply with its earlier directions. Accordingly, on 21st March, 2016, FCEL filed notice in respect of the said combination (bearing combination case Registration No.: C- 2016/03/384).
Issues for consideration
3 issues framed by the court
Whether an acquirer relying on a De Minimis Exemption notification based on the total assets/turnover of the seller enterprise, rather than the specific business unit acquired, can escape the mandator
Whether the Tax Fairness and Transparency Order (Target Exemption) applies to an unincorporated business division separate from its parent enterprise.
Whether an enterprise's approval of a combination on the merit of no appreciable adverse effect on competition (AAEC) exempts it from penalties for procedural non-compliance under Section 43A.
Parties & counsel
- petitioner
Future Consumer Enterprise Limited
- respondent
Grasim Industries Limited
Coram
Competition Commission of India
Case details
As recorded by the court registry
All orders in this case
2 orders share this CNR
- Order 1
- Order 2 — this page
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