CROSS-BORDER MERGERS IN INDIA – LEGAL CHALLENGES AND REFORMS

Cross-border mergers have emerged as a crucial mechanism for corporate restructuring in the context of globalization, particularly within India’s liberalized economic landscape. These transactions are legally facilitated under Section 234 of the Companies Act, 2013 and the Foreign Exchange Management (Cross Border Merger) Regulations, 2018, which jointly provide the regulatory foundation for both inbound and outbound mergers between Indian and foreign companies. However, despite the existence of this framework, several regulatory, procedural, and institutional challenges continue to hamper the seamless execution of such mergers. This paper employs a doctrinal legal research methodology, specifically the black-letter approach, complemented by comparative legal analysis to examine the legislative and regulatory framework governing cross-border mergers in India. It critically analyses the role and interplay of regulatory bodies such as the Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Competition Commission of India (CCI), and National Company Law Tribunal (NCLT), while also assessing judicial interpretations and statutory gaps. Key challenges identified include regulatory overlap, procedural inefficiencies, taxation uncertainties, recognition of foreign judgments, and the absence of a harmonized insolvency framework aligned with the UNCITRAL Model Law on Cross-Border Insolvency. By drawing comparisons with advanced jurisdictions such as the United States, United Kingdom, and Singapore—which have implemented streamlined procedures, institutional coordination, and investor-protective regimes—the study proposes a series of reforms. These include regulatory harmonization, extension of tax neutrality, adoption of international insolvency norms, and creation of a single-window clearance mechanism to strengthen India’s positioning as a competitive destination for cross-border mergers and acquisitions.