Abstract

In an era of globalization, cross-border mergers have emerged as a strategic tool for Indian companies seeking international expansion, resource optimization, and operational efficiency. Historically, the regulatory landscape in India restricted outbound mergers, limiting the ability of Indian firms to merge with or into foreign entities. However, the Companies Act, 2013, alongside the Companies (Compromises, Arrangements, and Amalgamations) Rules, 2016 (CAA Rules), and the Reserve Bank of India’s (RBI) Foreign Exchange Management (Cross-Border Merger) Regulations, 2018, have collectively redefined India’s approach to cross-border mergers by enabling outbound transactions under specific conditions. These legislative advancements have facilitated global fund allocation while maintaining regulatory safeguards to protect India’s economic interests. This research examines the evolving regulatory framework that governs cross-border mergers involving Indian companies, focusing on the shift from the Companies Act, 1956, to the more flexible Companies Act, 2013. It evaluates the role of key regulatory bodies, such as the National Company Law Tribunal (NCLT), in ensuring compliance and safeguarding stakeholder interests. Additionally, the study explores the RBI’s regulations on financial risk management, currency exchange, and capital outflows in cross-border mergers. Despite these advancements, Indian companies face challenges such as navigating complex regulatory compliance across jurisdictions, cultural integration, and financial risk management. This research aims to assess the effectiveness of India’s legal framework in supporting cross-border mergers, analysing its impact on regulatory compliance, financial management, and long-term strategic objectives. By identifying the challenges and opportunities associated with cross-border mergers, this study provides valuable insights into their implications for Indian businesses in a globalized market. The findings will contribute to a deeper understanding of how regulatory reforms influence the success of cross-border mergers, shaping India's role as a global business destination.

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