Team Code: SHERLOCK

IN THE NATIONAL COMPANY LAW APPELLATE TRIBUNAL

UNDER § 410 OF THE COMPANIES ACT, 2013 READ WITH § 53A OF THE

COMPETITION ACT, 2002

ULTRON AND VISION …Appellants

versus

COMPETITION COMMISSION OF KRAKOA …Respondent

~ MEMORANDUM FILED ON BEHALF OF APPELLANTS ~

1
 TABLE OF CONTENTS

TABLE OF CONTENTS ................................................................................................................. I

LIST OF ABBREVIATIONS ....................................................................................................... IV

INDEX OF AUTHORITIES ......................................................................................................... VI

I. STATUTES .............................................................................................................................. VI

II. CASES ..................................................................................................................................... VI

III. OTHER AUTHORITIES .................................................................................................... VIII

IV. BOOKS .................................................................................................................................. IX

V. REPORTS ................................................................................................................................ IX

STATEMENT OF JURISDICTION ............................................................................................. XI

STATEMENT OF FACTS .......................................................................................................... XII

ISSUES FOR CONSIDERATION ............................................................................................ XIV

SUMMARY OF ARGUMENTS .................................................................................................XV

ARGUMENTS ADVANCED ........................................................................................................ 1

I. WHETHER THE CCK HAS POWER TO INITIATE AN INQUIRY IN RELATION TO

VISION/DOOM COMBINATION AFTER EXPIRY OF ONE YEAR FROM THE DATE ON

WHICH THE COMBINATION WAS CONSUMMATED? .................................................... 1

I.1 It is in contravention of section 20(1) of the Competition Act. ................................................. 1

I
II. WHETHER THE UNAVAILABILITY OF ACCURATE DATA DUE TO HOSTILE

NATURE OF TAKEOVER, BE A DEFENCE AGAINST NON-FURNISHING OF

INFORMATION UNDER SECTION 43-A OF THE ACT, IN RELATION TO

ULTRON/STARK TECH TRANSACTION? ........................................................................... 3

III. WHETHER CCK WAS CORRECT IN DEFINING THE RELEVANT MARKET FOR

ASSESSMENT AS “MARKET FOR PROVISION OF SOFTWARE AND SOLUTIONS FOR

ONLINE EDUCATION PLATFROM”? ................................................................................... 8

III.1 The definition given by the CCK of relevant market does not fulfil the test of

substitutability. ........................................................................................................................... 8

III.2 That the products are asymmetrically substitutable making them a part of separate relevant

markets. .................................................................................................................................... 10

III.3 That the definition given by CCK does not qualify the SSNIP as well as SSNDQ Test. 11

III.4 That the dominant characteristics for the products of both companies are different. ...... 12

IV. WHETHER THE CCK’S PRIMA FACIE VIEW THAT IMPUGNED COMBINATION IS

LIKELY TO DISTORT COMPETITION DUE TO VERTICAL OVERLAPS, CORRECT? 14

[IV.1] There existed no overlap between the business of the two entities. .............................. 15

[IV.2] The combination comes within the ambit of exemptions given under schedule 1 of

combination regulations. .......................................................................................................... 17

[IV.3] the combination doesn’t cause appreciable adverse effect on competition................... 19

V. WHETHER THE MODIFICATIONS AS SUGGESTED BY CCI, WERE NECESSARY TO

ALLEVIATE THE COMPETITIVE CONCERNS ARISING OUT OF COMBINATION OR

II
 CAN THE CONCERNS BE ALLEVIATED BY WAY OF BEHAVIOURAL REMEDIES?

21

[V.1] That the modifications suggested by cck weren’t necessary to alleviate the competitive

concerns raised. ........................................................................................................................ 22

V.2 That behavioural remedies alone can eliminate the concerns raised by the combination. 24

PRAYER ................................................................................................................................... XVII

III
 LIST OF ABBREVIATIONS

ABBREVIATION DESCRIPTION

& And

§ Section

¶ Paragraph

AAEC Appreciable Adverse Effect on Competition

AIR All India Reporter

Anr. Another

Assoc. Association

CCI Competition Commission of India

CCK Competition Commisssion of Krakoa

CMLR Common Market Law Review

Co. Company

Comp LR Competition Law Reports

COMPAT Competition Appellate Tribunal

DG Director General

EC European Commission

ECJ European Court of Justice

ECR European Court Reports

Corp. Corporation

IV
Ch Chapter

BCCI Board of Control for Cricket in India

p. Page

EU European Union

Hon’ble Honorable

Ibid Ibidem

Inc. Incorporated

IT Information Technology

Ltd. Limited

M/s Messieurs

No. Number

JV Joint Venture

NCLAT National Company Law Appellate Tribunal

Para. Paragraph

Ors. Others

Pvt. Private

Reg. Registration

SC Supreme Court of India

SCC Supreme Court Cases

SCN Show Cause Notice

v. Versus

V
 INDEX OF AUTHORITIES

I. STATUTES

The Competition Act, 2002.

II. CASES

State Of Kerala v. Mathal Verghese & Ors., 1987 AIR 33, 1987 SCR (1) 317………………….21

The Dominion of India &Anr. v. Shrinbai A. Irani &Anr., 1954 AIR 596, 1955 SCR

206…………………………………………………………………………………………..

Municipal Board, Pushkar v. State Transport Authority, Rajasthan, 1965 AIR 458, 1963 SCR (2)

273………………………………………………………………………………………………..

Grundy v. Pinniger, (1852) 1 LJ Ch 405 ...................................................................................... 18

Consumer Unity and Trust Society v. PVR Limited, Case No. 29 of 2022……………………...

CCI v. Coordination Committee of Artistes and Technicians of West Bengal Film and Television

and Others, Civil Appeal No. 6991 of 2014. .............................................................................. 3

Ely Lilly & Company v. CCI, TA (AT) (Competition) No. 3 of 2017, Combination Reg. No. C-

2015/07/289 ................................................................................................................................ 4

Thomas Cook v. Competition Commission of India, Civil Appeal No. 13578 of 2015. ............. 25

Veolia v. Suez, COMPAT, Case No. 1292/5/7/18 ....................................................................... 13

Order under Section 31(1) of the Competition Act, 2002, Combination Reg. No. C-2015/02/249

................................................................................................................................................... 27

Haridas Exports v. All India Float Glass Manufacturers Association, Case No. Appeal (Civil) 2330

of 2000 ...................................................................................................................................... 26

Consumer Unity and Trust Society v. PVR Limited, Case No. 29 of 2022 ........................... 11, 24

Brown Shoe Co. v. United States, 370 U.S. 294 (1962. ............................................................... 23

VI
Veolia v. Suez, COMPAT, Case No. 1292/5/7/18 ....................................................................... 23

Ashish Ahuja v. Snapdeal, Order under section 26(2) of the Competition Act, 2002, Case No. 17

of 2014 ...................................................................................................................................... 23

Mohit Manglani v. Flipkart Pvt. Ltd, Case No. 80 of 2014 (CCI)................................................ 23

Make My trip case, Case No. 14 of 2019 & 01 of 2020 ............................................................... 16

Hoffmann-La Roche & Co. AG v. Commission of the European Communities, [1979] ECR 461

................................................................................................................................................... 21

Order under sub-section (1) of Section 31 of the Competition Act, 2002, Combination Reg. No.

2016/12/463. ............................................................................................................................. 25

Crown Cork & Seal Company Inc. and Carnuad Metabox SA ...................................................... 1

France Telecom v. Commission of the European Communities, C-202/07 ................................. 19

Bayer/Aventis Crop Science, Case No. COMP/M.2547 .............................................................. 22

Surinder Singh Barmi v. BCCI, Case No. 61/2010 ...................................................................... 23

Microsoft/ Skype, Case No COMP/M.6281, (n 46) para 81 ........................................................ 23

Order under Section 26(2) of the Competition Act, 2002, Case No. 15 of 2020 ......................... 24

Fast Track Call Cab Private Limited v. ANI Technologies Pvt. Ltd, Case No. 6 & 74 of

2015(CCI) ................................................................................................................................. 18

MMT case, Case No. 01 of 2020 (CCI ......................................................................................... 15

Matrimony.Com Limited v. Google Llc & Ors., Case No. 07 & 30 of 2012. .............................. 12

Delhi Vyapar Mahasangh v. Flipkart-The-Fight-For-one-Plus-Exclusivity, Case No. 40 of 2019

(CCI) ........................................................................................................................................... 3

All India Online Vendors Association v. Flipkart India Pvt. Ltd., Case No. 20 of 2018…………..18

Notice given by Grasim industries limited, Combination Reg. No. C-2015/03/256……………..16

VII
Notice given by Wolfgang Porsche holding GMBH (DR.), Combination Reg. No. C-

2016/04/388…………………………………………………………………………………….20

Notice given by Madison India Opportunities Trust Fund, Combination Reg. No. C-

2016/11/455…………………………………………………………………………………….20

Notice given by Highdell Investment Limited, Combination Reg. No. C-2014/09/207……….21

Notice Given by Cairnhill CIPEF Limited, Combination Reg. No. C-2015/05/276……………22

Order under Section 43A of the Competition Act, 2002, 2018 SCC ONLINE CCI 64………….23

Notice given by SCM Soilfert Limited, Combination Reg. No. C-2014/05/175………………..17

Notice given by Reliance Jio Infocomm Limited, Combination Reg. No. C-2017/06/516……..16

Notice given by Fosum Pharma Industrial PTE Limited, Combination Reg. No.C- 2016/08/425..

Bharti Airtel Limited v. Reliance Industries Limited, Case No. 03 of 2017……………………22

Thales/Finmeccanica/Alcatel Alenia Space & Telespazio, Case COMP/M.4403(2009/C

34/05)…………………………………………………………………………………………….21

Initial Decision, Illumina Corp., FTC Docket No. 9041,

2022………………………………………………………………………………………………23

Case M.8947 – Nidec/Embraco, (2020/C 229/05)………………………………………………24

Notice given by Schneider Electric India Pvt. Ltd., Combination Reg. no. C-

2018/07/586…………………………………………………………………………………….23

Decision and Order, Northrop Grumman Corporation, Docket No. C-4652……………………21

United States v. Comcast Corp., 1:11-cv-00106, (D.D.C 2011)………………………………..25

Case M.8306 - Qualcomm /NXP Semiconductors, C(2018) 167……………………………..22

Case M.9660 – Google/Fitbit, C(2020) 9105……………………………………………………..23

III. OTHER AUTHORITIES

VIII
Kunwar Arpit Singh, Viability of De Minimus Exemptions in the Competition (Amendment) Bill,

2022 in the Digital Market, Arbitration CorporateLawReview……………………………..22.

Daniel Mandrescu,, The SSNIP Test and Zero-Pricing Strategies: Considerations for Online

Platforms, European Competition and Regulatory Law Review, Volume 2 (2018), Issue 4, p.

244…………………………………………………………………………………………….18

Bruce D Hoffman, ‘Vertical Merger Enforcement at the FTC’, FTC (2018……………………..17

Merger Remedies Guide, International competition network, 2016, p.3………………………..19

Neil Averitt, Structural remedies in competition cases under the Federal trade commission Act,

Ohio State Journal, Vol. 40:779, (1979)…………………………………………………………17

Joseph J Simons, Makan Delrahim, Hart-Scott-Rodino Annual Report – Fiscal Year 2019, FTC,

Bureau of Competition and Department of Justice, Antitrust Division 2019…………………..18

Einer Elhauge, Harvard, Not Chicago: Which Antitrust School Drives Recent U.S. Supreme Court

Decisions?, 3 Competition Policy International (2007………………………………………15

Vertical Merger Guidelines, U.S. Department of Justice & Federal Trade Commission, 2020……

IV. BOOKS

Abir Roy, Competition Law in India: A Practical Guide (2nd ed. 2016) .................................... 29

D. G. Goyder, EC Competition Law, Oxford BC Law Libr, 1998 ............................................... 16

MA Utton, Market Dominance and Antitrust Policy (2nd ed. Edward Elgar Publishing 2003) .. 12

S.M. Dugar, Guide to Competition Law (6th ed. 2016). ............................................................... 10

S.M. Duggar, Guide to Competition Law (7th ed., LexisNexis, 2019). ....................................... 26

V. REPORTS

OECD Report on Prosecuting Cartels without Direct Evidence of Agreement, 2007 ................. 25

OECD Report on Prosecuting Cartels without Direct Evidence of Agreement, 2007. ................ 25

IX
Report Of Competition Law Review Committee 2019, Ministry of Corporate Affairs, GoI ......... 7

Report of the High Level Committee on Competition Policy and Law, Government of India, 2000

................................................................................................................................................... 20

Report of the working group on competition policy, 2010. .......................................................... 25

X
 STATEMENT OF JURISDICTION

The appellants have approached the National Company Law Appellate Tribunal under § 410 of

the companies act, 2013 read with § 53a of the competition act, 2002 which read as:

Section 410 - Constitution of Appellate tribunal -

The Central Government shall, by notification, constitute, with effect from such date as may be

specified therein, an Appellate Tribunal to be known as the National Company Law Appellate

Tribunal consisting of a chairperson and such number of Judicial and Technical Members as

the Central Government may deem fit, to be appointed by it by notification, [for hearing appeals

against--

(a) the orders of the Tribunal or of the National Financial Reporting Authority under this Act;

(b) any direction, decision or order referred to in section 53A of the Competition Act, 2002 (12

of 2002) in accordance with the provisions of that Act].

53A - Appellate Tribunal -

The National Company Law Appellate Tribunal constituted under section 410 of the Companies

Act, 2013 ( 18 of 2013) shall, on and from the commencement of Part XIV of Chapter VI of the

Finance Act, 2017 (7 of 2017), be the Appellate Tribunal for the purposes of this Act and the

said Appellate Tribunal shall— (a) hear and dispose of appeals against any direction issued or

decision made or order passed by the Commission under sub-sections (2) and (6) of section 26,

section 27, section 28, section 31, section 32, section 33, section 38, section 39, section 43,

section 43A, section 44, section 45 or section 46 of this Act;

53B. (1) The Central Government or the State Government or a local authority or enterprise or

any person, aggrieved by any direction, decision or order referred to in clause (a) of section

53A may prefer an appeal to the Appellate Tribunal.

XI
 STATEMENT OF FACTS

1. The Sovereign Republic of Krakoa is an Asian country, whose laws are in pari-materia with

the laws of India. Krakoa, with the world’s largest population of individuals under the age of

30, is seen as a goldmine for the growing market for Edu-Business, not just for providing

tutoring to students and for teaching aids like notes and smart learning technologies.

2. Vision Private Limited (“Vision”), incorporated in 2011 as a private limited company that

provides educational services for primary and secondary school curriculum and further studies

along with study material and resources. Ultron Inc. headquartered in United States of Aralia

acquired a majority stake and 3/4th representation on the board of directors of Vision.

3. Stark Tech Inc. is a public listed company, engaged in the business of providing advanced

technology and software solutions, headquartered in USA. It incorporated a wholly owned

subsidiary named Stark Ed Krakoa Pvt. Ltd. which is engaged in business of developing

software and digital online teaching tools for educational institute.

4. DOOM Pvt. Ltd. is another company, incorporated in Krakoa, that engages in business of

providing video transmission and streaming services to support various business activities.

15% and 11% stake in DOOM were acquired by Stark Ed and Ultron(via Vision) respectively.

5. Vision did not notify the acquisition to the CCK and consummated the acquisition on 19

February 2021. On 11 March 2021, the CCK issued a Show Cause Notice (SCN) to Vision,

Vision responded that combination came under exceptions and was therefore, not notifiable,

CCK didn’t interfere further.

6. In September 2021 due to imposition of lockdown educational institutions had to function

virtually, Vision that started its online educational platform in May 2021 and established a

XII
 market share of 20%. Stark Tech launched a new product, Jarvis; an AI-based personalization

technology (running on Stark Tech’s patented software) that was a disruptive technology that

no other international company was able to develop.

7. On 4 April 2022, Ultron started the process of hostile takeover of ‘Stark Tech’ in USA and

acquired 27% shareholding in Stark Tech from its existing shareholder Rhodes (“Rhodes Block

Transaction), subsequently, made a public offer for the remaining shares. Thus, Ultron

completed the hostile takeover of Stark Tech.

8. There was an indirect effect in Krakoa but it was not notified to CCK for its approval. After

receiving information about the transaction from Stark Ed. While analysing the takeover, CCK

took the prima facie view that the acquisition of 11% shares in DOOM is a combination and

no exemption was available to Vision/Ultron and thus notification was mandatory. The CCK

issued a Show cause notice to Vision to explain the above conduct.

9. The CCK in Show Cause Notice addressed to Vision and Ultron sought response on transaction

related to acquisition of 27% shares of Stark Tech.

10. CCK after hearing the parties held that, investment by Vision in Doom can’t be considered

solely for investment as it already had plans of launching the online platform, thus potential

vertical overlaps were present.

11. The CCK directed that Stark Ed and Ed-tech business of Vision shall continue to operate as

separate, independent and competitive entities and on an arm’s length basis and imposed a

penalty of KNR Seventy-Five Crores and One crore each under Section 44 and 45 of the Act,

on Ultron.

12. Aggrieved by such decision, Ultron and Vision preferred an appeal before NCLAT which is

listed for final hearing.

XIII
 ISSUES FOR CONSIDERATION

THE FOLLOWING ISSUES HAVE BEEN FRAMED FOR THE ARGUMENT BEFORE THE

NATIONAL COMPANY LAW APPELLATE TRIBUNAL:

I. WHETHER THE CCK HAS POWER TO INITIATE AN INQUIRY IN RELATION TO

VISION/DOOM COMBINATION AFTER EXPIRY OF ONE YEAR FROM THE DATE

ON WHICH THE COMBINATION WAS CONSUMMATED?

II. WHETHER THE UNAVAILABILITY OF ACCURATE DATA DUE TO HOSTILE

NATURE OF TAKEOVER, BE A DEFENCE AGAINST NON-FURNISHING OF

INFORMATION UNDER SECTION 43-A OF THE ACT, IN RELATION TO

ULTRON/STARK TECH TRANSACTION?

III. WHETHER CCK WAS CORRECT IN DEFINING THE RELEVANT MARKET FOR

ASSESSMENT AS “MARKET FOR PROVISION OF SOFTWARE AND SOLUTIONS

FOR ONLINE EDUCATION PLATFROM”?

IV. WHETHER THE CCK’S PRIMA FACIE VIEW THAT IMPUGNED COMBINATION

IS LIKELY TO DISTORT COMPETITION DUE TO VERTICAL OVERLAPS,

CORRECT?

V. WHETHER THE MODIFICATIONS AS SUGGESTED BY CCI, WERE NECESSARY

TO ALLEVIATE THE COMPETITIVE CONCERNS ARISING OUT OF

COMBINATION OR CAN THE CONCERNS BE ALLEVIATED BY WAY OF

BEHAVIOURAL REMEDIES?

XIV
 SUMMARY OF ARGUMENTS

I. WHETHER THE CCK HAS POWER TO INITIATE AN INQUIRY IN RELATION TO

VISION/DOOM COMBINATION AFTER EXPIRY OF ONE YEAR FROM THE DATE

ON WHICH THE COMBINATION WAS CONSUMMATED?

It is humbly submitted that the CCK does not have the power to initiate the inquiry after expiry

of one year from the date on which Vision/doom transaction was consummated because, It is

in contravention with section 20(1) of the Act.

II. WHETHER THE UNAVAILABILITY OF ACCURATE DATA DUE TO HOSTILE

NATURE OF TAKEOVER, BE A DEFENCE AGAINST NON-FURNISHING OF

INFORMATION UNDER SECTION 43-A OF THE ACT, IN RELATION TO

ULTRON/STARK TECH TRANSACTION?

It can act as a defense in the present case because, firstly, the CCK’s estimation of the valuation

of the target is flawed and accurate data was unavailable for the purpose of assessment under

the de minimis exemption [II.1], secondly, The ultimate purpose of the takeover was not taken

into consideration by the CCK while analyzing the requirement for notification. [II.2], and

lastly, The aforesaid takeover does led to AAEC [III.3].

III. WHETHER CCK WAS CORRECT IN DEFINING THE RELEVANT MARKET FOR

ASSESSMENT AS “MARKET FOR PROVISION OF SOFTWARE AND SOLUTIONS

FOR ONLINE EDUCATION PLATFROM”?

It is humbly submitted that, CCK’s definition of relevant market is misconstrued on the

grounds that, firstly, It does not fulfil the test of substitutability [III.1] , secondly , It falls within

the ambit of asymmetrical substitution making it a part of separate relevant market [III.2],

XV
 thirdly, It fails to satisfy the SSNIP Test [III.3], fourthly, The dominant Characteristics for the

products of both the company are different [III.4], and lastly, The mode of operation of both

companies are different making them a part of separate relevant markets [III.5].

IV. WHETHER THE CCK’S PRIMA FACIE VIEW THAT IMPUGNED COMBINATION

IS LIKELY TO DISTORT COMPETITION DUE TO VERTICAL OVERLAPS,

CORRECT?

It is humbly submitted that the prima facie view of the CCK isn’t correct on grounds that,

firstly, there existed no overlap between the business of the two entities [IV.1], Secondly the

combination comes within the ambit of exemptions given under Schedule 1 of CCI (Procedure

in regard to the transaction of Business relating to Combinations) Regulations,

2011(hereinafter referred to as Combination regulations) [IV.2] , and lastly,, the combination

doesn’t cause Appreciable Adverse Effect on Competition (hereinafter referred to as “AAEC”)

[IV.3]

V. WHETHER THE MODIFICATIONS AS SUGGESTED BY CCI, WERE NECESSARY

TO ALLEVIATE THE COMPETITIVE CONCERNS ARISING OUT OF

COMBINATION OR CAN THE CONCERNS BE ALLEVIATED BY WAY OF

BEHAVIOURAL REMEDIES?

It is humbly submitted that the modifications suggested by the CCK weren’t necessary to

alleviate the competitive concerns arising out of such combinations as the concerns can be

eliminated by way of behavioural remedies alone as firstly, that the modifications suggested

by CCK weren’t necessary to alleviate the competitive concerns raised [V.1], lastly that

Behavioural remedies alone can eliminate the concerns raised by the combination [V.2].

XVI
 ARGUMENTS ADVANCED

I. WHETHER THE CCK HAS POWER TO INITIATE AN INQUIRY IN RELATION TO

VISION/DOOM COMBINATION AFTER EXPIRY OF ONE YEAR FROM THE

DATE ON WHICH THE COMBINATION WAS CONSUMMATED?

I.1 It is in contravention of section 20(1) of the Competition Act.

I.1.1 It is Humbly submitted that Section 20(1) of the Act1 reads as “The Commission may,

upon its own knowledge or information relating to acquisition referred to in clause (a) of section

5 or acquiring of control referred to in clause (b) of section 5 or merger or amalgamation referred

to in clause (c) of that section, inquire into whether such a combination has caused or is likely

to cause an appreciable adverse effect on competition in India: Provided that the Commission

shall not initiate any inquiry under this sub-section after the expiry of one year from the date on

which such combination has taken effect.”2

I.1.2 In the facts of the present case Vision acquired an 11% stake in Doom.3 The said

Combination took effect on 19th February 20214. It is pertinent to note that the CCK decided to

initiate an inquiry into the said combination on 12 June 20225.

I.1.3. It is humbly submitted that the CCK has violated section 20(1) of the Act by not following

the language employed in that particular subsection, which implies a one-year time limit to

inquire into any kind of combination from the date from which it has taken effect.

1
Competition Act, 2002, § 20(1), No.12, Acts of Parliament, 2003 (India).
2
Ibid.
3
Moot Proposition, Page 3.
4
Moot Proposition, Page 4.
5
Moot Proposition, Page 7.
1
I.1.4. In the case of State of Kerala vs. Mathal Verghese & Ors6 the issue regarding currency

notes was observed. The Kerala High Court held that because IPC is being considered in the

present case, Only Indian currency would be covered under the scope of Section 498-A, But the

Supreme Court went with the “literal interpretation as section 498-A of IPC mentions “any

currency” therefore even foreign currency and banknotes shall be considered.”

I.1.5 In the case of Dominion of India &Anr. vs. Shrinbai A. Irani &Anr.7 the apex court held

that “The provisions cited are to be held literally and ought to be given their simple and

grammatical meaning. It has to be interpreted in the mild of the preamble of the ordnance”,

Similarly in the case of Municipal Board, Pushkar vs. State Transport Authority, Rajasthan8 it

was held through the apex court that “It shall be the duty of the court to interpret the regulation

as it is/ as it exists and an undeniable and grammatical which means shall be given even if it

affects too harsh conclusion.”.Further in the landmark case of Grundy v. Pinneger Lord

Caranworth9 it was said that Literal Rule is a cardinal rule, “Literal rule is a cardinal rule, from

which if we depart we launch the sea of difficulty which is not easy to fathom i.e.: not easy to

rectify.”10

I.1.6 It is humbly submitted that the CCK departed from the rule of literal interpretation and has

acted in a way which is against the spirit in which a judicial authority is supposed to act, also the

same is in violation of Judicial precedents set above by the Apex court and against the

jurisprudence set by the courts of competent authority worldwide.

6
State Of Kerala v. Mathal Verghese & Ors., 1987 AIR 33, 1987 SCR (1) 317.
7
The Dominion of India &Anr. v. Shrinbai A. Irani &Anr., 1954 AIR 596, 1955 SCR 206.
8
Municipal Board, Pushkar v. State Transport Authority, Rajasthan, 1965 AIR 458, 1963 SCR
(2) 273.
9
Grundy v. Pinniger, (1852) 1 LJ Ch 405.
10
Ibid.
2
 I.1.8 The Vision/Doom transaction came into effect on 19th February 2021, thereby according to

the text of Section 20(1)11 and applying the Rule of literal interpretation set in above cases the

last date on which the CCK was eligible to Inquire into the alleged combination was 19 th

February 2022, but in the facts of the instant case CCK decided to initiate an inquiry into the

said combination on 12th June 202212 under Section 20(1)13 of the Act which is in violation of

one year time limitation period which is highlighted in the same sub-section under which they

have decided to initiate the proceedings.

I.1.9 Thereby, since the CCK has decided to initiate an inquiry into the said combination after

expiry of one from which the said combination took effect, It is in violation of Section 20(1) of

the Act, therefore, In the light of the arguments presented above it is hereby humbly submitted

that the CCK does not have the power to initiate proceedings into Vision/Doom transaction after

expiry of one year on which the combination has taken effect.

II. WHETHER THE UNAVAILABILITY OF ACCURATE DATA DUE TO HOSTILE

NATURE OF TAKEOVER, BE A DEFENCE AGAINST NON-FURNISHING OF

INFORMATION UNDER SECTION 43-A OF THE ACT, IN RELATION TO

ULTRON/STARK TECH TRANSACTION?

It can act as a defense in the present case because, firstly, the CCK’s estimation of the valuation

of the target is flawed and accurate data was unavailable for the purpose of assessment under the

de minimis exemption [II.1], secondly, The ultimate purpose of the takeover was not taken into

consideration by the CCK while analyzing the requirement for notification. [II.2], and lastly,

The aforesaid takeover does led to AAEC [III.3].

11
Competition Act, 2002, § 20(1), No.12, Acts of Parliament, 2003 (India).
12
Moot Proposition, Page 7.
13
Ibid.
3
II.1 The CCK’s estimation of the valuation of the target is flawed and accurate

data was unavailable for the purpose of assessment under the de minimis

exemption.

II.1.1 Under the current competition regime, combinations which cross the threshold limit of

valuation of assets and turnovers provided in the Act have to be mandatorily notified to the

CCI.14 However, the fixed arithmetic threshold provided in the Act is an inefficient assessment

method to analyze combinations15

II.1.2 It is the humble submission that, the current threshold regime does not take into account

the volatility of market which may include unforeseen circumstances such as the pandemic. In

the Consumer Unity and Trust Society v. PVR case16, it was contended by Consumer Unity and

Trust Society that the assets and turnover threshold in the combination between the two entities

was affected by the extraordinary conditions of COVID-19 which made the provision of de

minimis exemption ineffective.

II.1.3 Further, as per the threshold provided under the de minimis exemption, the assets and

turnover of the target company/enterprise alone must be under 3.5 Billion Rupees and 10 Billion

Rupees respectively.17 It is submitted that, the word ‘enterprise’ must be understood in a practical

and functional sense.18 The application of the aforesaid threshold must be limited to the ‘true

14
The Competition Commission of India (Procedure in regard to the transaction of business
relating to combinations) Regulations, § 9(4), No. 3, 2011.
15
Kunwar Arpit Singh, Viability of De Minimus Exemptions in the Competition (Amendment)
Bill, 2022 in the Digital Market, Arbitration CorporateLawReview.
16
Consumer Unity and Trust Society v. PVR Limited, Case No. 29 of 2022.
17
The Competition Commission of India (Procedure in regard to the transaction of business
relating to combinations) Regulations, § 9(4), No. 3, 2011.
18
CCI v. Coordination Committee of Artistes and Technicians of West Bengal Film and
Television and Others, Civil Appeal No. 6991 of 2014.
4
target’ and the assets and turnover of only the concerned part of the entity shall be taken into

consideration of the purpose of calculation.19

II.1.4 In Ely Lilly and Company v. Competition Commission of India,20 wherein the appellant

claimed a flawed application of the notification threshold, it was held by the NCLAT that, as per

the notification, the de minimis exemption must apply only to the portion of business in the target

that is being acquired. It was concluded that, in case of a takeover, including the assets and

turnover of the parent enterprise for the purpose of determination of the de minimis exemption

is not the correct approach

II.1.5On the basis of the above, it is submitted that, the value of assets and turnover provided for

Start Ed which amounted to KNR 620 crores and 1008 crores respectively is inclusive of the

value of asset and turnover of Pepper Pots which does not fall within the ambit of the portion of

business being acquired.21 In addition to this, it is contended that, the estimated asset and

turnover of Start Ed does not encompass within it the extraordinary circumstances of COVID-

19 which resulted in market volatility and lead to changes the perspective on online education

leading to exorbitant increase in competition in the market.22

II.1.6 Hence, it is concluded that the valuation of asset and turnover of Start Ed is flawed and

cannot be relied upon for the purpose of determination of the de minimis exemption in the instant

case.

II.2 The ultimate purpose of the takeover was not taken into consideration by

the CCI while analyzing the requirement for notification.

19
Notification S.O. 988(E), dated 27th March, 2017
20
Ely Lilly & Company v. CCI, TA (AT) (Competition) No. 3 of 2017, Combination Reg. No.
C-2015/07/289.
21
Moot Proposition, Page 6.
22
Moot Proposition, Page 4.
5
II.2.1 It is submitted that, in Thomas Cook v. Competition Commission of India 23, the

respondents were under bona fide and genuine belief that the proposed combination would fall

under the exemption to the notification requirement under the act. Similarly, in Veolia-Suez

Takeover24, Veolia as per its estimations due to non-availability of information under a bona fide

belief considered the transaction to fall under the exemption to notification under the Act.

II.2.2 Further, In the case of Piramal/Sriram25 wherein the question involved interrelated

transactions, the determination of imposition of penalty due to non-notification was based on the

ultimate objects of these transactions. It was held by the CCI that in case a transaction does not

result in establishment of control and dominance it can be exempt from the notification

requirement under the Act.

II.2.3 Hence, it is submitted that in the present case due to the hostile nature of takeover accurate

data to furnish information was not available with Ultron. However, Ultron via Vision analysed

the financially available statements and under a bona fide belief concluded the transaction to fall

under the exemption to notification under the Act. It is concluded that, the ultimate objective of

the aforesaid takeover was to improve the provision of educational services in the growing

virtual platform in light of the pandemic which resulted in an increased need and competition

for the virtual learning processes.26

II. The aforesaid combination does not lead to AAEC.

II.3.1 Adverse effects on competition comprise of acts, contracts or combination which causes a

prejudice to public interest by disproportionately obstructing competition in the relevant

23
Thomas Cook v. Competition Commission of India, Civil Appeal No. 13578 of 2015.
24
Veolia v. Suez, COMPAT, Case No. 1292/5/7/18.
25
Order under Section 31(1) of the Competition Act, 2002, Combination Reg. No. C-
2015/02/249.
26
Moot Proposition, Page.1.
6
market.27 A combination that does not result in concentration of power in the relevant market,

adverse effects on the public interest, vigorous removal of competition etc. does not fall within

the meaning of AAEC. 28

II.3.2 Mere apprehension of likelihood of AAEC by an entity yet to take form cannot be the basis

of launching an investigation by the commission under the provisions of the Act. 29

II.3.3 It is submitted that, a combination falls within the meaning of AAEC when as a result of

such combination the business activities of small enterprises in the relevant markets get

adversely affected or it would result in vigorous elimination of competition.30 In Veolia-Suez

takeover, it was contended by Veolia that since there was no scope of vigorous elimination of

competition in the impugned combination, it was not likely to cause AAEC which excludes it

from the notification requirements under the Act.31

II.3.4 On the basis of above stated, it is submitted that, the aforesaid combination does not cause

AAEC on the basis that a combination between Ultron via Vision and Start Tech shall

supplement public interest through enhanced online education delivery. Moreover, the aforesaid

combination does not lead to an elimination of competition since there is no adverse effect on

the operation of other competitive entities such as Parker Ed and Marvel as a result of the

impugned combination.32

27
Haridas Exports v. All India Float Glass Manufacturers Association, Case No. Appeal (Civil)
2330 of 2000.
28
Competition Act, 2002, § 20(4), No.12, Acts of Parliament, 2003 (India).
29
Consumer Unity and Trust Society v. PVR Limited, Case No. 29 of 2022.
30
Brown Shoe Co. v. United States , 370 U.S. 294 (1962).
31
Veolia v. Suez, COMPAT, Case No. 1292/5/7/18.
32
Moot Proposition, Page 6.
7
III. WHETHER CCK WAS CORRECT IN DEFINING THE RELEVANT MARKET FOR

ASSESSMENT AS “MARKET FOR PROVISION OF SOFTWARE AND SOLUTIONS

FOR ONLINE EDUCATION PLATFROM”?

As per section 2(r) of the Competition Act, 2002 ‘relevant market’ can be divided into ‘relevant

product market’ and ‘relevant geographical market’33. Section 2(t) of the Act defines relevant

product market as the market consisting all the products which are substitutable with each other

by reasons such as the characteristics, intended use and price of the product.34 It is humbly

submitted that, CCK’s definition of relevant market is misconstrued on the grounds namely,

[III.1] It does not fulfil the test of substitutability, [III.2] It falls within the ambit of

asymmetrical substitution making it a part of separate relevant market, [III.3] It fails to satisfy

the SSNIP Test, [III.4] The dominant Characteristics for the products of both the company are

different, [III.5] The mode of operation of both companies are different making them a part of

separate relevant markets.

III.1 The definition given by the CCK of relevant market does not fulfil the test of

substitutability.

III.1.1 Any two products are considered to be a part of the same relevant market if the

consumers can easily switch between the products in response to factors such as changes in

price.35

III.1.2 It is the submission of the appellant that a relevant market is the market where a change

in one segment leads to an effect in the other.36 In the case of Mohit Manglani v. Flipkart Pvt.

33
Competition Act, 2002, § 2(r), No.12, Acts of Parliament, 2003 (India).
34
Competition Act, 2002, § 2(t), No.12, Acts of Parliament, 2003 (India).
35
Ashish Ahuja v. Snapdeal, Order under section 26(2) of the Competition Act, 2002, Case No.
17 of 2014.
36
Ibid.
8
 Ltd37. the commission separated the e-commerce markets from the offline markets on the basis

of the fact that they are not substitutable.

III.1.3 From the standpoint of competition case, the determination of relevant market is based

on substitutability of the products due to their characteristics, price and intended use instead of

the end use of the product.38 In Hoffman-La Roche v. Commission39 wherein the commission

was posed with the question that whether two vitamins easily available in the market but

performing distinct functions would fall under the ambit of similar relevant markets. It was

ruled that, the two vitamins (vitamin C and E) on the basis of their bio-nutritive use perform

exceedingly different functions and cannot be substituted for each other.

III.1.4 In Dish TV and Videocon D2H merger, the CCI while analysing the aforesaid merger

held the (Direct to Home) DTH broadcasting services to be not substitutable with the services

of Multi System Operators (MSOs), Local Cable Operators (LCOs), Internet Protocol

Television etc on the grounds of differences in prices, infrastructural requirements, technology

and packages offered.40

III.1.5 It is contended that in the instant case since Start Tech is primarily a software provider

company in contrast to the scope of Vision’s business which is restricted to that of an

educational platform. While the characteristics of Start Tech involves and is limited to

providing advanced technology and software solutions, Vision is involved in providing

educational services for primary and secondary schools.41 In this context, the services of both

37
Mohit Manglani v. Flipkart Pvt. Ltd, Case No. 80 of 2014 (CCI).
38
Make My trip case, Case No. 14 of 2019 & 01 of 2020.
39
Hoffmann-La Roche & Co. AG v. Commission of the European Communities, [1979] ECR
461.
40
Order under sub-section (1) of Section 31 of the Competition Act, 2002, Combination Reg.
No. 2016/12/463.
41
Moot Proposition, ¶.2.
9
 the companies are not substitutable in light of the notably divergent functions performed by

the two.

III.2 That the products are asymmetrically substitutable making them a part of separate

relevant markets.

III.2.1 In the case of Crown Cork & Seal Company Inc. and Carnuad Metabox SA42, the

substitution of Aluminium cans with Tinplate cans were considered to be asymmetrical on the

basis of lower cost as well as recyclability of the Tinplate Cans in comparison to the

Aluminium Cans due to which the consumers did not tend to switch from Tinplate to

Aluminium Cans.

III.2.2 In France Telecom v. Commission of the European Communities43, user expectation

was identified as the principle test for determination of question involving asymmetrical

substitution. It was held that the user expectations from high speed internet are highly different

from that of low speed internet in the context that though high speed internets can perform

tasks of low speed internet the users rarely shift to high speed internet for similar kind of

activities. Hence, the relevant market for both the services were considered to be separate on

the basis of their extreme asymmetrical nature. Similarly, in the case of Bayer/Aventis Crop

Science44, wherein the question was related to two comparable insecticides namely Jokey and

Latitude, it was concluded that since Jokey was effective only against ‘take all diseases’

whereas Latitude’s ambit included ‘take all diseases as well as other diseases they do not form

a part of the same relevant market on the grounds of them being asymmetrically substitutable.

42
Crown Cork & Seal Company Inc. and Carnuad Metabox SA.
43
France Telecom v. Commission of the European Communities, C-202/07.
44
Bayer/Aventis Crop Science, Case No. COMP/M.2547.
10
 III.2.3 On the basis of the above it is concluded that, while Vision’s line of business is limited

to providing educational services for primary and secondary school as well as test preparatory

coaching services, the line of business of Stark Ed includes provision for virtual learning

practices as well as providing advanced technology and software solutions.45This makes the

present case fall under the ambit of a classic case of asymmetrical substitution which makes

the relevant market for the services of both the enterprises distinct.

III.3 That the definition given by CCK does not qualify the SSNIP as well as SSNDQ

Test.

III.3.1 The small but significant and non-transitory increase in price test aims to substantially

test the substitutability between the products. It is asseverated that, as per this test when a

hypothetical monopolist increases its product price by 5-10 per cent above the competition

level the relevant market would constitute all those products which in view of the consumer

would be substitutable to tackle such a change in price.

III.3.2 In Surendra Sigh Barmi v. BCCI46 the commission while applying the SSNIP test to a

cricket event held that considering the consumer behaviour, it would be irrational to conclude

that a consumer would substitute a cricket event with any other form of entertainment or

sporting event.

III.3.3 It is submitted that in determination of substitutability factors such as characteristics,

price and intended use and most importantly trouble free switch between products play a

significant role.47

45
Moot Proposition, ¶. 2.
46
Surinder Singh Barmi v. BCCI, Case No. 61/2010.
47
Daniel Mandrescu,, The SSNIP Test and Zero-Pricing Strategies: Considerations for Online
Platforms, European Competition and Regulatory Law Review, Volume 2 (2018), Issue 4, p.
244.
11
 III.3.4 It is contended that a consumer apart from basing its decisions on the prices of the

entities also compare the enterprises on the basis of their qualities. Quality is one of the main

considerations on which enterprises compete which each other in their relevant markets.48

III.3.4 In the instant case as already stated, the line of business of Vision covers educational

services for primary and secondary school curriculum. On the contrary, the business of Start

Tech is limited to providing Ed-tech Solutions. In this context it is contended that, an increase

in price in the product/services of Vision would not result in a shift by the consumers to the

services of Start tech on the grounds that the services of both the entities are not substitutable

in nature. Moreover, the present case also does not quality the SSNDQ test on the basis that

Start Ed’s Jarvis turned out to be a disruptive innovation in the market that many experts

claimed to have the potential to permanently change the delivery of education.49

III.4 That the dominant characteristics for the products of both companies are different.

III.4.1 It is submitted that, in the cases where a corporation performs various function it

becomes important to identify its dominant features in order to categorize them into relevant
50
markets. In the case of Harshita Chawla v. WhatsApp Inc and Ors which dealt with the

question of defining relevant markets for Facebook and WhatsApp, the commission held that,

even though both the apps fall within the ambit of consumers communication services, the

relevant market must be determined on the basis of the most dominant feature of the app(s).

48
Microsoft/ Skype, Case No COMP/M.6281, (n 46) para 81.
49
Moot Proposition, ¶.18.
50
Order under Section 26(2) of the Competition Act, 2002, Case No. 15 of 2020.

12
 III.4.2 The CCI (commission) in the case of Fast Track Call Cab Private Limited v. ANI

Technologies Pvt. Ltd.51 gave significance to key feature/dominant characteristic of the

product in question and held ‘radio cab services’ to be a relevant market by itself on the

grounds that the characteristics of these radio taxis which include pre-booking facility,

predictability in terms of expected journey time etc cannot be found in any other means of

transport.

III.4.3 In the present case, while Vision dominantly deal with the provision of educational

services, domestic test preparatory coaching services for competitive exams the activity of

Start Tech dominantly involves provision of advance technology and software solutions.52

Hence, the characteristics of both the companies are distinct in nature making them non-

substitutable.

III.5 That the mode of market for both companies is different making them a part of

separate relevant markets

III.5.1 It is humbly submitted that, online channels are a distinct mode of distribution which

are not substitutable by offline mode of distributions.53 Further, the limited internet access and

reach makes the offline and online modes of distribution incomparable as held by the

commission in the case of Matrimony Comp Ltd. v. Google54.

51
Fast Track Call Cab Private Limited v. ANI Technologies Pvt. Ltd, Case No. 6 & 74 of
2015(CCI).
52
Moot Proposition, ¶. 5.
53
MMT case, Case No. 01 of 2020 (CCI).
54
Matrimony.Com Limited v. Google Llc & Ors., Case No. 07 & 30 of 2012.

13
 III.5.2 In Delhi Vyapar Mahasagar v Flipcart55, the CCI while considering the question of

relevant market in case of an online-offline marketplace held both the markets to be a part of

separate relevant market on the basis that the online marketplace is dominated by majority 2-

3 entities which operate through online markets as their dominant channel of distribution.

Similarly, in All India Online Vendors Association v. Flipkart56 ‘services provided by online

marketplaces for selling of goods in India.’ was determined as the relevant market making a

distinction between online and offline marketplaces.

III.5.3 therefore, It is humbly submitted that in the instant case, while Vision majorly provides

its services in the offline mode of distribution which includes provisions of question banks,

test series etc, Start Tech’s operation is concentrated and limited to providing technologically

advanced Ed-tech solutions making it a part of offline mode of distribution.57 In context of the

above stated facts, it is conclusively submitted that CCK has erred in defining relevant market

for assessment as ‘market for provision of software and solutions for online education

platforms’

IV. WHETHER THE CCK’S PRIMA FACIE VIEW THAT IMPUGNED COMBINATION

IS LIKELY TO DISTORT COMPETITION DUE TO VERTICAL OVERLAPS,

CORRECT?

It is humbly submitted that the prima facie view of the CCK isn’t correct and acquisition of

11% shares in Doom by Ultron via Vision doesn’t violate § 6(1)58 of the Act which provides

for notification requirement to CCK before consummating a combination because firstly, there

55
Delhi Vyapar Mahasangh v. Flipkart-The-Fight-For-one-Plus-Exclusivity, Case No. 40 of
2019 (CCI).
56
All India Online Vendors Association v. Flipkart India Pvt.. Ltd., Case No. 20 of 2018.
57
Moot Proposition, ¶.2.
58 Competition Act, 2002, § 6(1), No.12, Acts of Parliament, 2003 (India).
14
 existed no overlap between the business of the two entities [IV.1] secondly, the combination

comes within the ambit of exemptions given under Schedule 1 of CCI (Procedure in regard to

the transaction of Business relating to Combinations) Regulations, 2011(hereinafter referred

to as Combination regulations) [IV.2] and thirdly, the combination doesn’t cause Appreciable

Adverse Effect on Competition (hereinafter referred to as “AAEC”) [IV.3].

[IV.1] There existed no overlap between the business of the two entities.

It is humbly submitted that the parties to the combination were involved in two different markets

without any vertical overlap between both the parties. The CCK analyses the combination to

ensure that there is no appreciable adverse effect on competition in the relevant market, for the

same the CCI in Grasim Industries Limited case59, while considering the merger of two

companies involved in chemical manufacturing business broke down the process of analysis of

combination into: (a) delineation of the relevant market (product and geographic); (b)

identification of overlap in the relevant market; and finally, (c) subjecting the combination to

competition analysis under section 20(4) of the Act.

(a) Both the companies operate in different product markets:

IV.1.1. The CCK has formed the prima facie view that the combination can have AAEC due to

potential vertical overlap between the entities, but the relevant markets need to be delineated for

the same. Vision is a company which is involved in providing educational services along with

teaching supplements like reading materials, recorded lectures, question banks, test series, notes,

offline through its own centres.

59. Notice given by Grasim industries limited, Combination Reg. No. C-2015/03/256.

15
IV.1.2 Whereas Doom is in business of providing video transmission and streaming services to

support various activities like broadcasting, OTT platforms, videotelephony, online conferences,

etc i.e it is an online service provider.

IV.1.3Both the parties to the combination functioned in different product markets as neither of

the two products can become a substitute for the other which is the basis for analysing the

horizontal overlap between the entities to the combination.60 There no exists no horizontal

overlap.

(b) There existed no vertical overlap between the parties to the combination:

IV.1.4 To analyse a combination, the CCI in Madison India Opportunities Trust Fund, In Re61,

the CCI while considering the question of vertical overlap analysed whether the companies are

engaged in any activity which can be regarded as being at different stages or levels of the

production chain.

IV.1.5 In the instant case, the parties i.e VISION and DOOM both operate in different markets

and neither of the two are present in the upstream/downstream market for the other during the

time of combination, and neither of the two use the other entity’s product/service as an input for

its own business. Therefore, there is no vertical relationship between them.

60
Notice given by Wolfgang Porsche holding GMBH (DR.), Combination Reg. No. C-
2016/04/388.
61
Notice given by Madison India Opportunities Trust Fund, Combination Reg. No. C-
2016/11/455.
16
IV.1.6 Thus, the prima facie view of the CCK is incorrect given the absence of horizontal product

overlap and vertical relationship62, the proposed combination is not likely to have any effect on

competitive conditions in India whatsoever at the time of the transaction or in the future after.

[IV.2] The combination comes within the ambit of exemptions given under schedule 1 of

combination regulations.

IV.2.1 The Schedule 1 of the Combination regulations provides the conditions in which an

entity is exempt from notifying the CCK of the combinations, the Item 1 in this schedule

provides for such an exemption when acquisition is of less than 25%. To qualify under the

exemption, the CCI while considering the acquisition of 11% shares in Mankind pharma by

Cairnhill CIPEF limited and Cairnhill CGPE Limited63 interpreted the Item 1 Schedule 1

exemption along with Regulation 4 of the regulations and provided the circumstances in which

Notice in respect of a combination need not normally be filed if the acquisition of shares or

voting rights, (a) does not entitle the acquirer to hold twenty-five per cent or more of the total

shares or voting rights of the target; (b) does not result in acquisition of control over the target

by the acquirer; and (c) is made solely as an investment or in the ordinary course of investment.

IV.2.2 If an acquirer holds more than 25% shares in the target, then this amounts to acquisition

of control i.e negative control64 or control can be acquired even if acquirer possess any special

rights other than the ordinary voting rights that an ordinary shareholder holds, or gets a seat in

the board of directors or has an authority to nominate one, or the acquirer has a say in strategic

62
Notice given by Highdell Investment Limited, Combination Reg. No. C-2014/09/207.
63
Notice Given by Cairnhill CIPEF Limited, Combination Reg. No. C-2015/05/276.
64
Order under Section 43A of the Competition Act, 2002, 2018 SCC ONLINE CCI 64.
17
 commercial decisions and management of the target. If a combination is to come under the

exemption than none of the above factors amounting to control should exist.65

IV.2.3 In the instant case, no such acquisition of control has been done or even an intention to

participate in the business decisions exists, thus the Combination doesn’t lead to control of

the target by the acquirer and comes under the exemption given under Schedule 1 of the

regulations.

(IV.2.4) The acquisition of shares is done solely for an investment purpose and in the

ordinary course of business.

IV.2.5 The exemptions given under Schedule 1 also provide that acquisition of 10% or less

shares in the target company comes under the ambit of ‘solely as an investment purpose’ and

investment done ‘in ordinary course of business. In Reliance Jio Infocomm

Limited66combination, the CCI distinguished between between revenue and capital

transactions. Capital transactions are considered to be strategic i.e., having economic or

competitive significance and the revenue transactions are considered to be routine and usual in

nature.

IV.2.6 It is humbly submitted that in the instant case, the acquisition of shares in Doom by

Vision can be termed as ‘ordinary course of business’ i.e for investment purpose and is a

revenue transaction as it doesn’t provide any competitive or economic significance to the

acquirer in any sense as both are engaged in different lines of business and the benefit which

65
Notice given by SCM Soilfert Limited, Combination Reg. No. C-2014/05/175.
66
Notice given by Reliance Jio Infocomm Limited, Combination Reg. No. C-2017/06/516.

18
 will be accrued to VISION will only be as an investor and doesn’t accrue to them any long

term benefit in its own business and market, thus it doesn’t affect competition.

IV.2.7 Therefore, it is humbly submitted that he exemption under Item 1 schedule I of the

combination regulations.

[IV.3] THE COMBINATION DOESN’T CAUSE APPRECIABLE ADVERSE EFFECT ON

COMPETITION.

§20(4) of the Act provides the factors which are to be taken into account while deciding upon

the effect of the combination on competition but none of the factors are satisfied to a level which

would cause AAEC in the present case,

IV.3.1 It doesn’t lead to increase in extent of barriers to entry into the market67:Vision’s business

was offline, and the acquisition of minority share in an online streaming service providing

company won’t prevent or impede newcomers into a market or industry sector, and so limit

competition, as the combination doesn’t lead to control by the acquirer over the target and their

existed no vertical overlap as contended in the foregoing submission.

IV.3.2 In arguendo, The CCI in Grasim Industries68 held that even if the combined market shares

come within the range of 65-50%, isn’t conclusive of AAEC in the market. In the present case,

even if online part of the business of Vision is considered, the market share of which is 30%
69
only, it wouldn’t lead to any potential barrier to entry as the level of vertical integration which

may be caused due to acquisition of minority share without any controlling power is not

significant enough to prevent competitors from entering the market.

67
Competition Act, 2002, §20(4) (b), No.12, Acts of Parliament, 2003 (India).
68
Supra, note 2.
69
Moot Proposition, ¶.24.
19
IV.3.3 Likelihood that combination would result in the parties to the combination being able to

increase price or profit margins significantly and sustainably:70 The parties work in different

markets and provide services of a kind which are unrelated to each other, thus the question of

increase in prices as a result of combination doesn’t arise.

IV.3.4 Extent of effective competition likely to sustain in a market71

The CCI held that presence of other options in the market evidences the fact that the combination

doesn’t cause AAEC.72 The market in which Vision operates is education provides through

coaching centres and Doom works in the market of Online streaming service provider, also

Vision only has 30% market share, hence isn’t dominant in the market. Therefore, competition

in this market isn’t going to be affected in either of the above-mentioned markets.

IV.3.5 Likelihood that the combination would result in the removal of a vigorous and effective

competitor or competitors in the market73

Due to absence of any vertical overlap, the question of removal of vigorous and effective

competitor doesn’t arise as the relevant markets in which both the entity’s function is different

and neither one of them acts as an upstream/downstream market for the other and the stake being

acquired doesn’t give the acquirer any right to control the affairs of Doom. Similarly, there

existed no relative advantage to the either party due to the combination74, neither does the

combination have any adverse impact on competition. Thus, the Proposed Combination is not

70
Competition Act, 2002, §20(4)(e), No.12, Acts of Parliament, 2003 (India).
71 Competition Act, 2002, §20(4)(f), No.12, Acts of Parliament, 2003 (India).
72 Notice given by Fosum Pharma Industrial PTE Limited, Combination Reg. No.C-
2016/08/425.
73
Competition Act, 2002, §20(4)(i), No.12, Acts of Parliament, 2003 (India).
74
Competition Act, 2002, §20(4)(m), No.12, Acts of Parliament, 2003 (India).
20
 likely to result in substantial change in competition dynamics in the online and offline education

market and accordingly does not raise unilateral or coordinated effects concerns.75

IV.3.6 The European Commission while investigating the merger in

Thales/Finmeccanica/Alcatel Alenia Space and Telespazio76, followed a three-step examination:

ability, incentive, and potential effect of input foreclosure i.e whether post the combination the

acquirer can restrict other entities in the downstream market from receiving the input required,

thus increasing rivals’ cost. In the instant case, the acquirer i.e Vision doesn’t have any ability

which could result into input foreclosure as it hasn’t acquired control over the target i.e Doom

and in absence of a meaningful ability, the economic theories of incentive are irrelevant 77, thus

the question of incentive to foreclose the rivals doesn’t arise. The share in the market for online

educational platform doesn’t need to be considered as the stake acquired doesn’t provide the

acquirer with any controlling power.

IV.3.7 It is humbly submitted that considering the absence of any ability to foreclose the market

and cause AAEC, the acquisition of 11% shares of Doom by Vision doesn’t raise any

competitive concern.

V. WHETHER THE MODIFICATIONS AS SUGGESTED BY CCI, WERE NECESSARY

TO ALLEVIATE THE COMPETITIVE CONCERNS ARISING OUT OF

COMBINATION OR CAN THE CONCERNS BE ALLEVIATED BY WAY OF

BEHAVIOURAL REMEDIES?

75
Bharti Airtel Limited v. Reliance Industries Limited, Case No. 03 of 2017.
76
Thales/Finmeccanica/Alcatel Alenia Space & Telespazio, Case COMP/M.4403(2009/C
34/05).
77
Initial Decision, Illumina Corp., FTC Docket No. 9041, 2022.
21
 It is humbly submitted that the modifications suggested by the CCK weren’t necessary to

alleviate the competitive concerns arising out of such combinations as the concerns can be

eliminated by way of behavioural remedies alone as firstly, that the modifications suggested

by CCK weren’t necessary to alleviate the competitive concerns raised [V.1], secondly, that

Behavioural remedies alone can eliminate the concerns raised by the combination [V.2].

[V.1] That the modifications suggested by cck weren’t necessary to alleviate the

competitive concerns raised.

V.1.1 The objective behind giving remedies is to render the concentration compatible with the

common market so that they will prevent a significant impediment to effective competition.

The commitments in order to be effective and acceptable have to eliminate the competition

concerns raised by the merger entirely78. Non-structural remedies are acceptable if they are at

least equivalent in its effects to a divestiture79 and the suitable remedy has to be examined on

a case-by-case basis80.

V.1.2 Behavioural remedy may be preferred over a structural remedy if it enables the pro-

competitive efficiencies from the merger to be realized and at the same time effectively

preserves the competition.81 Such remedies are also in consonance with the guiding principles

for remedial actions82, as such remedies are tailored to the harm caused to competition i.e

remedies suggested are proportionate to the amount of harm caused, such remedies are effective

as they balance the competitive effect it has on the parties as well as on the market, such

78
Council Regulation (EEC) No 139/2004.
79
Ibid.
80
Id. at 16.
81
Bruce D Hoffman, ‘Vertical Merger Enforcement at the FTC’, FTC (2018).
82
Merger Remedies Guide, International competition network, 2016, p.3.
22
 remedies can be put into effect quickly and resolve the concerns raised as compared to structural

remedies.There have been instances where structural remedies like divestiture may fail as in

case of Nidec/Embraco83.

V.1.3 The CCI has accepted behavioural remedies to allay customer and input foreclosure

concerns in transactions between companies at different levels of a production chain84, Use of

such remedies is common in situations where competitors don’t have access to inputs such as

advanced technology and supply agreements. concerns such as input foreclosure and access to

technology are often eliminated by Behavioural remedies.

V.1.4 A structural remedy can be accepted if the any of the following conditions are fulfilled If

a behavioural remedy has an effect which is equivalent to that of a structural remedy , then the

following conditions should be fulfilled for a structural remedy to be acceptable (1) the

Commission must show that divestiture is the most effective remedy for the violation; or (2) it

must show that divestiture is the most cost-effective remedy; or (3) it must show that divestiture

is the only effective remedy.85

V.1.5 Thus, in the present case the remedy y suggested by the CCK,, that the Ed-tech business

of Vision and Stark tech need to be separate, independent entity, that the Ed tech business of

Vision and Stark Ed will operate as separate, independent and competitive entities was neither

wasn’t necessary nor not proportionate to the level of harm the merger would have caused,

nullifying the takeover falls short of being the most effective remedy for violation, cost-

83
Case M.8947 – Nidec/Embraco, (2020/C 229/05).
84
Notice given by Schneider Electric India Pvt. Ltd., Combination Reg. no. C-2018/07/586.
85
Neil Averitt, Structural remedies in competition cases under the Federal trade commission
Act, Ohio State Journal, Vol. 40:779, (1979).
23
 effective, or the only remedy as behavioural remedies alone could have eliminated the concerns

raised by the takeover of Stark Tech by Ultron and its effect in Krakoan territory.

V.2 That behavioural remedies alone can eliminate the concerns raised by the

combination.

V.2.1 The concerns raised by the impugned combination as identified by the CCK are that it

would result in heavy market concentration and substantial lessening of competitive constraints

in the markets where Vision and Stark Ed operate in Krakoa and given the significance of Stark

Tech’s AI based software, Ultron would have both the ability and incentive to engage in vertical

foreclosure strategies leading to hampering technical advancement and innovation86. The above

concerns raised by the CCK can be eliminated by the following conduct remedies:

V.2.2 Non-discrimination and access provisions: Non-discrimination remedy requires the

merged entity to treat other market participants in a fair and even-handed manner. Such a remedy

may take form in either of the following ways, by providing key inputs to competitors on a non-

discriminatory basis as accepted by the US FTC in Northrop Grumman/Orbital ATK 87 or by

providing a level of interoperability between its services and the third party’s platform. This

remedy is based on concept of equal access, equal efforts, and equal terms.

V.2.4 It is proposed that Ultron (or Ultron via Vision) won’t discriminate in providing access to

the said software to any competitor in the market in accordance with the FRAND (Free,

reasonable and non-discriminatory) principles and would work with Vision’s competitors in the

downstream market on the same terms and conditions Stark Ed. used to prior to the takeover.

The merged entity will ensure the interoperability between the software services provided by

86
Moot Proposition, ¶.36.
87
Decision and Order, Northrop Grumman Corporation, Docket No. C-4652.
24
Stark Ed. and the players in the downstream market i.e educational platforms. The

interoperability remedy would enable third party suppliers to offer standalone products that

would interoperate with the products of the merged entity and wouldn’t enter into exclusive

agreements88.

V.2.6 Creation of a Data Silo: Data is a significant asset in the mergers of digital companies.

Data silo repository of data that's controlled by one department or business unit and isolated

from the rest of an organization, this is like the firewall provisions which have been accepted as

a remedy by competition commission across jurisdictions. The ‘Data silo’ remedy was accepted

by the European Commission (EC) in the Google/Fitbit merger89. It is proposed that creation of

a data silo will prevent divulsion of information received/ collected by the software ‘Jarvis’ while

operating on the different platforms in the downstream market or in the upstream market. The

data collected won’t be accessible by Vision. This would prevent harm resulting from the merged

firm having access to competitively sensitive information about rival firms and likelihood of

coordinated actions as required by the Vertical merger guidelines90.

V.2.7 Transparency provision: It is proposed that the merged entity will provide access to the

information, required to ensure the compliance with the commitments provided, periodically to

an independent monitoring trustee/agency (approved/appointed by the CCK), Ultron/ Vision

shall provide the Monitoring Trustee with copies of all agreements entered into under these

Commitments promptly following the execution thereof, in each case subject to the Monitoring

Trustee’s obligations of professional secrecy.

88
Case M.8306 - Qualcomm /NXP Semiconductors, C(2018) 167.
89
Case M.9660 – Google/Fitbit, C(2020) 9105.
90
§ 4.b, Vertical Merger Guidelines, U.S. Department of Justice & Federal Trade Commission,
2020.
25
V.2.8 It is also proposed that there will be a provision for revising the commitments or reopening

of the proceedings if (a) there has been a material change in any of the facts on which the decision

was based.91

V.2.16 Therefore, it is humbly submitted that in light of the above behavioural remedies alone

could have eliminated the concerns raised by the CCK.

91
Article 9(2), Council Regulation (EC) No 1/2003).
26
 PRAYER

THEREFORE, IN THE LIGHT OF ISSUES RAISED, ARGUMENTS ADVANCED,

REASONS GIVEN AND AUTHRITIES CITIED, THIS HON’BLE TRIBUNAL MAY BE

PLEASED TO:

I. HOLD THAT THE CCK DOESN’T HAVE POWER TO INITIATE AN INQUIRY IN

RELATION TO VISION/DOOM COMBINATION AFTER EXPIRY OF ONE YEAR

FROM THE DATE ON WHICH THE COMBINATION WAS CONSUMMATED.

II. HOLD THAT THE UNAVAILABILITY OF ACCURATE DATA DUE TO HOSTILE

NATURE OF TAKEOVER CAN BE A DEFENCE AGAINST NON-FURNISHING OF

INFORMATION UNDER SECTION 43-A OF THE ACT, IN RELATION TO

ULTRON/STARK TECH TRANSACTION.

III. HOLD THAT CCK WASN’T CORRECT IN DEFINING THE RELEVANT MARKET

FOR ASSESSMENT AS “MARKET FOR PROVISION OF SOFTWARE AND

SOLUTIONS FOR ONLINE EDUCATION PLATFROM”.

IV. HOLD THAT THE CCK’S PRIMA FACIE VIEW THAT IMPUGNED COMBINATION

IS LIKELY TO DISTORT COMPETITION DUE TO THE VERTICAL OVERLAPS IS

INCORRECT.

V. HOLD THAT THAT THE MODIFICATIONS AS SUGGESTED BY CCI, WEREN’T

NECESSARY TO ALLEVIATE THE COMPETITIVE CONCERNS ARISING OUT OF

ACQUISITION OF STARK-TECH BY ULTRON AND BEHAVIOURAL REMEDIES

ALONE ARE SUFFICIENT TO ELIMINATE THE COMPETITIVE CONCERNS..

XVII
AND ANY OTHER RELIEF THAT THIS HON’BLE TRIBUNAL MAY BE PLEASED TO

GRANT IN THE INTEREST OF JUSTICE, EQUITY AND GOOD CONSCIENCE.

ALL OF WHICH IS RESPECTFULLY SUBMITTED.

Sd/-

COUNSELS FOR APPELLANTS

XVIII