On August 10, the National Company Law Appellate Tribunal (NCLAT) rendered a verdict rejecting an appeal lodged by the Consumer Unity & Trust Society (CUTS), contesting a Competition Commission of India (CCI) order.

The CCI had earlier dismissed CUTS’ complaint against the merger of PVR and INOX Leisure.

The CCI’s refusal, issued in September 2022, cited concerns of potential anti-competitive practices by a yet-to-be-formed entity, making it unsuitable for investigation. In March 27, PVR and INOX Leisure unveiled their merger plan, which didn’t necessitate CCI clearance due to falling below the regulatory threshold.

While the CUTS had expressed fears of anticompetitive consequences and urged an in-depth inquiry, the CCI, in a seven-page verdict, opined that unmaterialized concerns of Appreciable Adverse Effect on Competition (AAEC) by an entity yet to take shape shouldn’t be investigated under the Competition Act’s provisions, Money Control reported.

The CCI also clarified that, if abusive conduct arises post-facto, it can be examined under the Act. The regulator dismissed concerns of potential dominance by PVR-INOX Leisure, as the merger was yet to be fully realized and legally recognized.

This merger, once finalized, will result in India’s largest multiplex chain boasting over 1,500 screens.

The proposal garnered approval from shareholders and creditors of both companies. Additionally, NSE and BSE also greenlit the merger in June this year, cementing its path forward.