Competition Landscape in India: Insights and Future Trends

In this article, Justin Coombs, Jincy Francis, Neha Georgie, Avinash Mehrotha, and Kadambari Prasad summarise recent significant regulatory changes in India’s competition landscape, spotlight the continued focus on digital markets, reflect on key moments from 2025, and look ahead to 2026.

The views expressed are those of the authors only and do not necessarily represent the views of Compass Lexecon, its management, its subsidiaries, its affiliates, its employees, or clients.

Introduction

2025 was a busy year for the Competition Commission of India (the “CCI”) and the courts, with a focus on digital regulation and AI. Competition regulation in the digital sector saw important recalibration in 2025, with policymakers signalling caution on sweeping ex-ante rules while strengthening traditional enforcement. There is a push from industry participants for a phased, evidence-based approach to digital regulation, greater capacity for the CCI, and stronger protections for small and medium-sized enterprises – amid strong industry pushback against broad upfront obligations.

At the same time, enforcement standards were tightened: the Supreme Court’s Schott Glass ruling made effects-based analysis mandatory in abuse of dominance cases, while the National Company Law Appellate Tribunal (the “NCLAT”) diluted strict data-sharing bans in favour of user opt-outs in the WhatsApp case. Merger control saw a transaction filing taken to Phase 2, making it the first Phase 2 merger in six years, and was subsequently cleared with modifications.

Updated cost regulations now better reflect digital business models, improving market assessments, although the CCI has adopted a light-touch stance on Artificial Intelligence (“AI”) for now, focusing on transparency and internal safeguards rather than immediate regulation.

Looking ahead to 2026, India’s competition framework is positioned for more active enforcement and robust merger control, supported by new regulations and rising deal volumes. The CCI is expected to prioritise conduct investigations, conclude stalled cases, and see greater use of settlements and commitments, while continuing to fine-tune procedural rules such as deal value thresholds. Digital markets will remain a core focus, alongside growing institutional capacity and technical expertise – particularly in AI – suggesting a more mature, effects-driven competition regime rather than blunt regulatory intervention.

Ex-ante regulations hit a roadblock while ex-post investigations of digital markets continue

Competition issues in the digital sector remained in the spotlight. In 2025, the Parliamentary Standing Committee on Finance reviewed the CCI’s role in India’s economy, particularly the digital landscape. In its report, the committee called for a phased, nuanced and evidence-based approach to digital competition regulation in India.[1]

Key observations and recommendations in this report include:

• adopting a nuanced approach to the ex-ante regulation: use ongoing market studies as inputs for refining the provisions including the thresholds for designating firms subject to the ex-ante regulation; allow digital players to rebut their designation under the regulation in exceptional cases; and avoid blanket prohibitions in the regulation.
• increasing the institutional capacity and funding of the CCI: fill human-resource gaps; explore flexible engagement models; ensure adequate budget allocations; and invest in advanced analytical tools.
• protecting small and medium enterprises: reassess the newly instituted deal value threshold for filing mergers, so that large corporations cannot acquire smaller firms without regulatory scrutiny; and continue proactive investigations into predatory pricing and deep discounting by dominant online platforms.

Digital players continued to opine on the potential use of ex-ante regulation. Both global and local technology firms strongly resisted it, warning of ‘over-capture’ and arguing that the proposed thresholds and the lack of rebuttal mechanisms would hurt innovation and investment.[2] In November 2025, the Ministry of Corporate Affairs issued a request for proposal for a market study on the qualitative and quantitative thresholds under the proposed ex-ante regulation.[3]

Post-Schott Glass, effects-based analyses are now unavoidable in abuse of dominance cases

The Supreme Court Schott Glass judgement set a precedent for abuse of dominance cases assessed under the Competition Act. In 2012, the CCI found in that Schott Glass abused its dominant position, by offering preferential terms to its downstream arm, refusing to supply downstream firms that engaged other suppliers and offering anti-competitive volume-based rebates. The Supreme Court has now overturned the CCI’s order primarily because the CCI had not conducted a sufficient effects-based analysis. It stated that an analysis of effects was necessary not only in this case, but in all abuse of dominance cases. This was a landmark judgement which has now brought effects analysis into mainstream analysis and we expect that going forward the CCI will have to present an analysis of effects in its orders.

Data sharing remedies less likely to hold up; opt-outs more likely

Remedies in digital market assessments that ban data sharing now have a lower chance of success in India. In the WhatsApp decision, the CCI had found that WhatsApp abused its dominance in implementing a policy update which compelled users to accept sharing data with Meta to continue using its service. The CCI’s directions included a five-year ban on WhatsApp sharing user data with other Meta companies for advertising purposes. WhatsApp appealed the decision to the NCLAT, which affirmed the CCI’s decision but set aside the CCI’s data sharing remedy. Instead, the NCLAT determined that an opt-out mechanism would protect users.

Updated regulations likely to inform better decision-making for digital market assessments

Digital market assessments in particular are likely to benefit from updated regulations that have revised the cost metrics the CCI will use in its assessments. Standard costs used in these assessments, like “long run average incremental cost” and “total cost”, have now been redefined to encompass issues that are typical for digital firms. The inclusion of sunk costs in these assessments enables more accurate analyses of firms that have high upfront costs. Overall, these changes are expected to enable more consistent and streamlined assessments.

Approach to AI remains light-touch

The CCI’s approach to AI was laid out in its recently published market study. Current indications are that the authority will tread lightly in the first instance, considering but not regulating competition issues that arise from the use of AI. While the study highlighted potential concerns including predatory pricing and exclusionary practices, the CCI has limited next steps to broad recommendations along the lines of self-audits, increased transparency and advocacy, while considering strengthening its technical capacity.

Looking ahead to 2026

The year ahead is expected to set the pace for India’s competition landscape. After the regulatory overhaul of India’s competition law in 2023-2024 and developments that followed in 2025, the foundation for enforcement and merger activity in India is now in place.

We expect merger activity in India to remain robust, building on the stronger deal volume in the second half of 2025, with businesses moving forward despite the ongoing uncertainty around geopolitics.[4] Combined with the CCI’s updated merger guidance and timely merger reviews, prospects for merger control look promising. One factor to watch out for is capacity - the coming months may indicate whether the CCI will consider expanding its capacity to keep pace with increased merger filings.

We anticipate that the CCI will prioritise antitrust investigations, given that the number of cases nearly doubled from 2024 to 2025. The authority is also expected to finalise existing investigations, which were previously stayed due to challenges in the courts. We also foresee a higher number of settlement and commitment applications, as both the CCI and practitioners have gained greater experience with these processes over the past year.

We may also see further clarifications on procedural and substantive issues, reflecting the learnings from the operations of the new regulations. The CCI may be able to assess whether the deal value thresholds have been capturing the type of transactions that they were intended to capture, and whether their implementation can be streamlined.

Digital markets are likely to continue to attract enforcement attention, in line with the trends we see globally. In parallel, we expect the CCI to enhance its advocacy initiatives and further build technical expertise in artificial intelligence. This could include the CCI setting out its approach to case-specific issues as the regulatory landscape evolves, potentially in collaboration with other competition authorities. The CCI has already taken steps in this direction, recently having organised a workshop as a preparatory event in the lead up to the India AI Impact Summit to be held in February 2026.[5] The summit will host numerous discussions relevant to the CCI’s efforts, ranging from sector-specific AI issues that could inform analyses to embedding AI in the authority’s own processes.[6]

In what follows, we summarise the key regulatory developments (in Section 2), describe the most prominent competition cases (in Section 3) and outline highlights from the CCI’s AI market study (in Section 4).