How the Corporate Laws (amendment) Bill, 2026 May Change Cross‑border Mergers and Restructurings in India

Cross-border mergers india planning is entering a decisive new phase, and foreign investors, private-equity sponsors and in-house counsel need to recalibrate before signing anything. The Corporate Laws (Amendment) Bill, 2026 was introduced in the Lok Sabha on 23 March 2026, referred to a Joint Parliamentary Committee, and the Committee tabled its report in Parliament on 3 August 2026. The Bill amends both the Companies Act, 2013 and the Limited Liability Partnership Act, 2008. Its merger provisions — wider fast-track eligibility, a single-bench NCLT regime and rationalised approval thresholds — reach directly into inbound and outbound reorganisations involving an Indian company. This practitioner briefing sets out what is proposed, how any changes would interact with the existing web of regulators, the Reserve Bank of India, DPIIT, the Competition Commission of India, SEBI and the courts, and where the practical decision points sit.

Read it as a decision tool, not an academic survey: it takes a position on structuring, sequencing and risk allocation so your deal team can move quickly and confidently. Because the Bill remains subject to the legislative process and subordinate rule-making, confirm the operative provisions and dates against official sources before relying on them.

Who should read this: senior in-house counsel, corporate M&A teams, PE and strategic acquirers evaluating or planning cross-border mergers, absorptions or schemes of arrangement involving India. This is general information, not legal advice. Consult counsel for transaction-specific advice.

Executive summary, what the Bill may change for cross‑border mergers (quick take)

The Bill’s thrust is procedural consolidation rather than a new cross-border gateway. It does not abolish tribunal oversight for contested schemes, it does not touch the exchange-control layer, and it does not amend Section 234. What it does is compress the judicial layer and widen an existing fast-track. Read the summary below against that framing: the significant liberalisation of cross-border merger procedure happened in September 2024 and September 2025, through subordinate rule-making, and is already in force.

• The fast-track cross-border route is already law, not a proposal. The streamlined channel is not a 2026 proposal — it has been law since 17 September 2024. Rule 25A(5), inserted by the Companies (Compromises, Arrangements and Amalgamations) Amendment Rules, 2024, allows a foreign holding company to merge into its Indian wholly-owned subsidiary through the Section 233 fast-track route, with approval by the Regional Director rather than the NCLT. The Companies (CAA) Amendment Rules, 2025 widened fast-track eligibility further from 4 September 2025. What the Bill adds is narrower and more procedural: broader Section 233 eligibility for holding-subsidiary and startup combinations, and a reduction of the creditor approval threshold from 90% to 75% in value.
• Regulator coordination may become more explicit. The Bill proposes that all applications under Sections 230–232 be filed before the NCLT bench having jurisdiction over the transferee or resultant company, ending the multi-bench coordination problem that has repeatedly delayed group restructurings with legs in several states. That consolidates the judicial layer; it does not consolidate the regulators. Early, parallel engagement across the RBI, DPIIT, the CCI and SEBI remains the winning strategy, not sequential filing.
• Timing can compress or expand. Pre-filing consultations may add weeks up front but can reduce total elapsed time if you parallelise court, exchange-control and competition workstreams.
• FEMA/FDI remains a separate, non-negotiable layer. Nothing under discussion removes the need for RBI/FEMA compliance or DPIIT/FDI clearance where the sector or shareholding pattern requires it.
• Minority protection. Court scrutiny of fairness continues, so your fairness and disclosure package must be built to a high standard from day one.
• Tax, not company law, is the binding constraint. Procedure for inbound mergers has been liberalised twice since 2024. The tax cost has not moved. Inbound reverse flips have carried nine- and ten-figure tax bills, and outbound mergers still attract full capital gains exposure because neutrality requires an Indian amalgamated company. Price the tax before you admire the process.
• Immediate action: re-open your deal timetable, budget for regulator engagement, and secure early tax and valuation opinions before you commit to a route.

Legislative changes, key considerations under the Corporate Laws (Amendment) Bill, 2026

Where the framework sits

The corporate law framework for mergers and schemes of arrangement is administered by the Ministry of Corporate Affairs, which remains the primary source for the Companies Act, 2013 provisions, official notices and any Bill text. The substance for cross-border deals sits in the provisions of the Companies Act governing compromises, arrangements and amalgamations (broadly, sections 230 to 240, including the cross-border merger provision in section 234), and in the procedural machinery that connects corporate approval to the exchange-control and competition regimes. Cross-border mergers are also governed by the Companies (Compromises, Arrangements and Amalgamations) Rules, 2016 and the RBI’s Foreign Exchange Management (Cross Border Merger) Regulations, 2018. Two points of precision are worth carrying through the rest of this note. The Bill does not amend Section 234. Its cross-border effect runs indirectly, through Section 233, the proposed single-bench rule and the valuation framework. And Rule 25A, which carried the cross-border fast-track from 2024, was absorbed into a self-contained Rule 25 by the Companies (Compromises, Arrangements and Amalgamations) Amendment Rules, 2025, notified as G.S.R. 603(E) on 4 September 2025.

Where a provision is still subject to notification or subordinate rule-making, treat it as indicative and confirm the operative date against the official gazette before you rely on it. For enacted changes and final notifications, the Gazette of India is the authoritative record.

Comparison table: current position vs proposed direction for cross-border mergers india

The following comparison captures the practical delta between existing practice and the direction the proposed reforms may take. Use it to identify which levers in your transaction may move, and verify each item against the enacted law before relying on it.

What remains unchanged

Several pillars are stable. The exchange-control layer under FEMA still applies to every inbound and outbound share issuance and transfer, and the Reserve Bank of India remains the gatekeeper for those rules. Sectoral FDI conditions administered by DPIIT continue to govern which sectors are automatic and which require prior approval. Competition scrutiny under the Competition Commission of India continues to bite wherever the combination crosses notification thresholds. And for listed companies, SEBI disclosure and stock-exchange scheme requirements remain live. Any reform reshapes the corporate-law spine; it does not dissolve the regulatory skeleton around it. Two constraints are missed often enough to be worth stating flatly. First, outbound mergers remain confined to the jurisdictions specified in the Annexure to the Cross Border Merger Regulations — broadly, those whose securities regulator is a signatory to the IOSCO Multilateral Memorandum of Understanding, or whose central bank is a member of the Bank for International Settlements. A counterparty in the wrong jurisdiction is a structuring dead end, not a negotiating point. Second, since 10 September 2024 the CCI’s deal value threshold catches transactions above INR 2,000 crore where the target has substantial business operations in India, irrespective of whether the traditional asset and turnover tests are met.

Practical effects on merger routes and schemes of arrangement

The reforms could change the calculus between the principal structuring routes. Below we separate the three most common paths for cross-border mergers india teams evaluate, and identify where changes may bite.

Cross-border merger under the Companies Act (amalgamation / absorption)

An amalgamation or absorption fuses the transferor into the transferee by operation of a sanctioned arrangement, transferring assets, liabilities and undertakings by universal succession. For cross-border deals, where an Indian company merges with a foreign company or vice versa under section 234 of the Companies Act and the RBI Cross Border Merger Regulations, this route requires both corporate approval and clearance under the exchange-control framework. For the specific case of a foreign holding company merging into its Indian wholly-owned subsidiary, a streamlined channel already exists and has done since 17 September 2024. Rule 25A(5) permits that transaction through the Section 233 fast-track route, with approval by the Regional Director rather than the NCLT, subject to prior RBI approval for both entities and a 60-day Regional Director clock; four to six months end-to-end is a realistic planning assumption. The practical upside is speed. The practical risk is that a mis-scoped filing sends you back to the slower Sections 230–232 track, having lost the time already spent.

Confirm eligibility against the enacted text before committing your timetable. This is a well-worn path rather than a theoretical one. Groww completed its inbound merger from the United States in May 2024; Zepto completed its Singapore-to-India flip in January 2025; Pine Labs obtained Singapore court approval in May 2024 and NCLT approval in April 2025; Meesho moved from Delaware with NCLT approval in mid-2025; Razorpay completed its US-to-India redomiciliation in May 2025; and Flipkart secured approvals in September 2025 to relocate from Singapore ahead of a domestic listing. The route works. What varies between these transactions is the tax cost, discussed below.

Scheme of arrangement route

A scheme of arrangement remains the most powerful tool where you need tribunal-sanctioned, binding treatment of dissenting stakeholders. It is the route of choice for complex restructurings, debt reorganisation, demergers, spin-offs, or multi-entity consolidations with cross-border legs, because the National Company Law Tribunal (NCLT) order binds all classes once sanctioned. Any reform is expected to preserve tribunal oversight for these arrangements, which is precisely why the scheme remains attractive when enforceability in India and certainty against dissenters matter most. Expect the procedural steps, application, class meetings, creditor and member votes, and final sanction by the NCLT, to continue, potentially with additional disclosure and coordination obligations layered onto the front end.

Reconstructions and compromises with creditors and members

Reconstructions, arrangements involving compromises between a company and its creditors or members, sit adjacent to schemes and are frequently used to reshape capital structures ahead of a cross-border transaction. Any reforms would affect these primarily through enhanced disclosure and tighter regulator coordination. Where a reconstruction precedes or forms part of a broader cross-border restructuring india strategy, sequence it deliberately: a reconstruction that alters shareholding or introduces foreign investment may itself trigger FEMA and FDI review before the main merger step even begins.

Approvals & compliance checklist for cross-border mergers india (FEMA, FDI, CCI, SEBI, NCLT)

This is the operational heart of any cross-border deal. Below is a stepwise, regulator-by-regulator checklist with indicative timing and pre-filing actions. Treat every duration as indicative and stress-test it against current circulars before you fix longstop dates.

FEMA / RBI

Every cross-border merger with an inbound or outbound capital element engages FEMA. The transferee’s issuance of securities to foreign shareholders, or the transfer of an Indian company’s assets abroad, must comply with the pricing, reporting and, where applicable, prior-approval rules administered by the Reserve Bank of India and the Foreign Exchange Management (Cross Border Merger) Regulations, 2018.

• Confirm the route: automatic or approval, based on sector and shareholding.
• File the required reporting forms for any inbound issuance or transfer within the prescribed windows.
• Deemed-approval check: confirm the transaction fits within the Cross Border Merger Regulations so that a compliant merger is deemed to have RBI approval under Regulation 9; where it does not, prior RBI approval is required. Watch the asymmetry between routes: a fast-track merger under Rule 25A requires prior RBI approval for both the foreign transferor and the Indian transferee, so the deemed-approval comfort available on the Sections 230–232 route does not map cleanly onto the fast-track. Where the foreign transferor is incorporated in a country sharing a land border with India, a declaration in Form CAA-16 is also required.
• Indicative timing: allow several weeks for structuring confirmation; longer where prior approval is needed.

FDI / DPIIT

The sectoral position under the DPIIT FDI policy determines whether the foreign investment element proceeds automatically or requires government approval. Map the target’s business against the current sectoral caps and conditions, and check whether the transaction implicates the rules requiring prior government approval for investors from countries sharing a land border with India (or where the beneficial owner is situated in or is a citizen of such a country).

• Sector mapping: identify caps, entry conditions and any prohibition.
• Beneficial-ownership check: confirm whether the land-border prior-approval rule applies.
• Indicative timing: automatic-route deals move fast; government-approval-route filings can add several weeks to months.

CCI

If the combination crosses the notification thresholds, clearance from the Competition Commission of India is a hard gating item. Cross-border deals frequently trip the thresholds through global turnover and asset tests, and the deal value threshold, in force since 10 September 2024 under Section 5(d) of the Competition Act read with the CCI (Combinations) Regulations, 2024, catches any transaction valued above INR 2,000 crore where the target has substantial business operations in India. “Substantial business operations” means, broadly, that 10% or more of the target’s global user base is in India for digital businesses, or that Indian turnover exceeds both 10% of global turnover and INR 500 crore for everyone else. The threshold was designed precisely to catch transactions that look small on a domestic balance sheet.

• Threshold analysis: run the asset and turnover tests early, and check the de minimis exemption, which applies where the target has Indian assets of up to INR 450 crore or Indian turnover of up to INR 1,250 crore. Note the trap: de minimis does not rescue a transaction caught by the deal value threshold. The two tests are mutually exclusive, and deals that were comfortably exempt before September 2024 may now be notifiable.
• Filing preparation: assemble the notification with overlap analysis and remedy contingencies.
• Indicative timing: the CCI must form its prima facie view within 30 calendar days of notification, failing which the combination is deemed approved, and the outer deemed-approval limit is now 150 calendar days rather than 210. Both clocks stop for information requests, so build contingency for a Phase II review rather than planning to the statutory minimum.

SEBI and stock exchanges

Where a listed Indian company is involved, the scheme must clear the SEBI and stock-exchange process, including no-objection from the exchanges, a valuation and fairness package, and compliance with the SEBI (Listing Obligations and Disclosure Requirements) Regulations and the relevant SEBI scheme circular and disclosure obligations. Build the SEBI observation-letter step into your critical path, it precedes the NCLT application for listed schemes.

• Exchange filings: submit the scheme with the required auditor and fairness documentation.
• Disclosure discipline: maintain continuous disclosure and manage unpublished price-sensitive information.
• Indicative timing: the observation-letter stage typically runs in parallel with pre-NCLT preparation.

NCLT sanction for the scheme

Where the structure requires it, the scheme proceeds to the National Company Law Tribunal for sanction: application, directions for class meetings, notice to regulators and creditors, the meetings themselves, and the final sanction order. Indian tribunal practice on schemes remains the enforceability backbone; appeals lie to the National Company Law Appellate Tribunal (NCLAT), and relevant judicial guidance on schemes, minority rights and fairness is available through the Supreme Court of India repository. Build in time for objections and, where available, seek directions to expedite uncontested matters.

Immediate action: convene all regulator workstreams at kick-off and run them in parallel. The single biggest timetable error in cross-border mergers india is treating FEMA, CCI, SEBI and the tribunal as sequential rather than concurrent.

Tax, valuation and minority protections, practical structuring implications

Tax consequences for inbound and outbound reorganisations

Tax neutrality for amalgamations is available only where exacting statutory conditions are met, and the governing statute has just changed. The Income-tax Act, 1961 stands repealed with effect from 1 April 2026 and the Income-tax Act, 2025 governs income from FY 2026-27 onwards, with the 1961 Act continuing only for earlier years and pending proceedings. The asymmetry that matters most for cross-border planning survives the rewrite intact: neutrality is available only where the amalgamated company is an Indian company (Section 70(1)(f) of the 2025 Act, corresponding to Section 47 of the 1961 Act). An outbound merger, where the surviving entity is foreign, therefore attracts full capital gains exposure for both the Indian company and its shareholders. This, and not procedure, is why outbound mergers remain rare while inbound reverse flips have become routine. For inbound and outbound reorganisations, confirm the treatment against the framework administered by the Income Tax Department and obtain a written opinion before you fix the structure. The Corporate Laws (Amendment) Bill, 2026 does not itself alter tax treatment; what must be priced is the transition to the 2025 Act, including how carried-forward losses, unabsorbed depreciation and MAT credits are carried across. Get the tax view before the valuation, not after, the tax structure frequently dictates the optimal legal route.

Case study — what coming home actually costs. PhonePe’s October 2022 shift from Singapore to India was executed as an inbound merger. It generated a capital gains liability of close to INR 8,000 crore (approximately USD 1 billion), borne largely by Walmart, alongside the lapse of around USD 900 million of accumulated losses and a fresh India-based ESOP roll-out to compensate employees for the change in share value. Groww’s reverse flip, completed in May 2024, carried a reported cost of about USD 160 million. Razorpay’s, completed in May 2025, was reported at approximately INR 1,245 crore. Meesho’s carried roughly USD 280–300 million of US tax before its NCLT approval in 2025. Every one of these transactions cleared the corporate-law and exchange-control layers without serious difficulty. In each case the tax bill, not the procedure, was the term that determined whether and when the deal happened. Model it first.

Valuation expectations and minority dissent protections

Valuation sits at the intersection of tax, exchange-control pricing rules and fairness scrutiny. Foreign-investment pricing guidelines, SEBI valuation requirements for listed schemes, and tribunal expectations on fairness all converge on a single number that must survive challenge. Statutory class-meeting and voting thresholds and the requirement for a registered-valuer report raise the bar on the fairness package: expect scrutiny of the exchange ratio and the independent-valuer report, and prepare minority communications that pre-empt objection.

Drafting protective clauses

Translate the valuation and minority position into contract. Include a valuation-adjustment mechanism tied to regulatory pricing outcomes, an express fairness-opinion condition, and a communications protocol for dissenting shareholders. These clauses convert a compliance obligation into a managed, allocated risk.

Risk mitigation and deal drafting: model covenants and conditions precedent

Sample conditions precedent and timeline allocation

Conditions precedent are where any 2026 changes must be operationalised. Build a CP schedule that mirrors the approvals map and allocates each item to a longstop date with buffer.

• Regulatory CPs: receipt of RBI/FEMA compliance confirmation; DPIIT/FDI approval where required; CCI clearance; SEBI observation letter and exchange no-objection; and the NCLT sanction order.
• New-filing CPs: completion of any additional procedural filings the enacted law introduces, expressly named so neither party can dispute satisfaction.
• Longstop discipline: set the longstop against the slowest realistic path, typically CCI or a contested tribunal step, and add automatic-extension mechanics for regulatory delay outside the parties’ control.

Indemnities and break fees

Allocate regulatory risk explicitly: who bears the cost of remedy conditions imposed by the CCI, who funds a cure for a filing defect, and who carries the break fee if a clearance is refused. Where the enacted law introduces mandatory undertakings, draft indemnities to sit consistently with those statutory positions rather than cutting across them.

Case study — Zee and Sony. The NCLT sanctioned the composite scheme between Zee Entertainment and Sony’s Culver Max Entertainment and Bangla Entertainment on 10 August 2023. In January 2024 Sony terminated the merger cooperation agreement on the footing that closing conditions had not been satisfied. Each side then claimed a USD 90 million termination fee, with Sony pursuing arbitration at the Singapore International Arbitration Centre. The parties settled on a non-cash basis in August 2024, and on 5 September 2024 the NCLT recalled its own sanction order and permitted withdrawal of the scheme. Zee booked roughly INR 432 crore of merger-related costs across the two years. Three drafting points follow. A sanction order is not a closing. “Commercially reasonable efforts” is the clause that gets litigated, so define it against measurable financial thresholds rather than leaving it at large. And decide at signing which forum decides a termination dispute, because a scheme sanctioned by the NCLT and a merger agreement governed by an offshore arbitration clause can pull in opposite directions at precisely the moment the deal breaks.

Reps and warranties for regulatory compliance

Regulatory reps should cover historic FEMA and FDI compliance, absence of undisclosed competition exposure, and the accuracy of information supplied to regulators. Align these reps to the applicable statutory duties so that a breach maps cleanly to a remedy. A well-drafted regulatory-compliance rep is the first line of defence when a post-closing filing question emerges.

Case study — Amazon and Future Coupons. The CCI cleared Amazon’s investment in Future Coupons in November 2019. In December 2021 it kept that clearance in abeyance and imposed penalties totalling INR 202 crore, holding that Amazon had suppressed the actual scope and purpose of the combination; the NCLAT substantially upheld those findings in June 2022. The Supreme Court set aside both orders in May 2026 and directed a refund with interest. Amazon was vindicated — but only after four and a half years under a suspended clearance, by which time the underlying commercial opportunity had gone. The drafting lesson is not about who was right. It is that the cost of a disclosure dispute is borne in deal time, not in damages. Build the regulatory-disclosure protocol, the document-retention discipline and the reps around information supplied to regulators on the assumption that every internal email explaining the strategic rationale will one day be read back to you.

Comparison: current vs proposed, decision table for structuring choices

The centrepiece comparison above sets out the dimension-by-dimension delta. The practical conclusion is straightforward: the emerging direction rewards teams that engage regulators early and punishes those that treat the process as linear. Where your deal may fit a carve-out, a streamlined route could materially shorten elapsed time; where it does not, the tribunal-sanctioned scheme remains the certain path. The decision therefore turns on eligibility, the need to bind dissenters, and how much enforceability certainty you require in India.

Decision framework, which route to choose

Choose the scheme of arrangement route (A) when:

• You need a tribunal-sanctioned, binding restructuring that binds dissenting minority holders through the statutory voting and sanction process.
• The cross-border elements are complex and require judicial approval for enforceability in India.
• You have time in the timetable and value certainty over speed.

Choose an amalgamation / streamlined merger or asset transfer with regulatory approvals (B) when:

• The structure fits the Section 233 fast-track — in cross-border terms, principally a foreign holding company merging into its Indian wholly-owned subsidiary — and prior RBI approval is obtainable for both entities.
• The key FEMA, FDI, CCI and SEBI consents are predictable and can be secured early.
• Stakeholders prioritise speed and want to minimise judicial involvement.

Choose a hybrid or staged route (A+B) when:

• Outcomes are uncertain, begin with pre-filing regulatory clearances and retain the scheme as a fallback if objections emerge.
• You want to allocate CPs and longstops across both paths so the deal does not collapse if a streamlined route proves ineligible.

Our position: for most sizeable, contested or minority-sensitive cross-border mergers india teams should default to the scheme route for enforceability, and reserve the Section 233 fast-track for clean, clearly eligible, speed-critical deals, of which the inbound merger of a foreign holding company into its Indian wholly-owned subsidiary is now the dominant real-world example. When in genuine doubt, stage the transaction and preserve the scheme as a fallback.

How to engage regulators fast, best practices for statutory filings and contested approvals

Pre-application meetings and the evidence pack

The single most effective accelerant is a well-prepared pre-filing engagement. Before formal submission, assemble an evidence pack that anticipates every regulator’s core question: the structure chart, sectoral analysis, competition overlap assessment, valuation and fairness documentation, and a clear statement of the exchange-control treatment. Where a pre-filing consultation is available (for example, the CCI’s pre-filing consultation facility), use it to surface objections while they are still cheap to fix.

Handling objections and expedited hearings

When objections arise, from a regulator, a creditor or a dissenting shareholder, respond with documented, source-anchored submissions rather than argument alone. For tribunal steps, seek directions to expedite uncontested elements and separate them from genuinely contested points so the whole scheme does not wait on a single objection. Early, transparent engagement consistently outperforms a defensive posture.

Next steps checklist for foreign investors and counsel

1. Confirm eligibilityfor the Section 233 fast-track against Rule 25 of the Companies (Compromises, Arrangements and Amalgamations) Rules as amended in 2024 and 2025, before fixing your route.
2. Map every regulator, FEMA/RBI, DPIIT/FDI, CCI, SEBI/exchanges, NCLT, and launch the workstreams in parallel.
3. Obtain an early tax opinionon amalgamation neutrality under the Income-tax Act, 2025, and on how carried-forward losses, unabsorbed depreciation and MAT credits transition from the 1961 Act.
4. Lock the valuation methodologyto survive pricing-rule, SEBI and fairness scrutiny.
5. Build the CP schedulewith named regulatory and new-filing conditions and realistic longstops.
6. Draft regulatory reps, indemnities and break feesthat align with applicable statutory duties.
7. Prepare the pre-filing evidence packand, where available, request pre-application consultations.
8. Engage experienced Indian counselto lead regulator engagement alongside local tax advisers.

For a broader view of assembling the right team, see the guide to choosing an international corporate lawyer in India, and consult a transaction-level FEMA, FDI and CCI compliance checklist for the detail.

Need Legal Advice?

This article was produced by Global Law Experts. For specialist advice on this topic, contact Bhupender Singhat Artham Law Chambers, a member of the Global Law Experts network.

Further reading and resources

Anchor every legal step to primary sources: the Ministry of Corporate Affairs for the Companies Act provisions and any Bill text, the Reserve Bank of India for FEMA and the Cross Border Merger Regulations, DPIIT for FDI policy, the Competition Commission of India for merger control, SEBI for listed-company schemes, and the Income Tax Department for reorganisation tax treatment. The Bill text and the Joint Parliamentary Committee report of 3 August 2026 are both on the public record and should be read in preference to secondary summaries.

This article is general information, not legal advice. Cross-border mergers india structuring is fact-specific; consult qualified counsel for transaction-specific advice, and confirm any provision still subject to notification before relying on it.

Sources

1. Ministry of Corporate Affairs (MCA)
2. Reserve Bank of India (RBI)
3. Department for Promotion of Industry and Internal Trade (DPIIT)
4. Competition Commission of India (CCI)
5. Securities and Exchange Board of India (SEBI)
6. Income Tax Department
7. Gazette of India
8. Supreme Court of India