Merger Under Scrutiny — The CCI Antitrust Economist

A four-round, advanced competition-economics simulation set inside the Competition Commission of India (CCI), Combination Division, New Delhi. You are the economics cell reviewing a notified ₹14,200 crore all-cash merger: Aarav Foods Ltd. (≈27% of the national branded edible-oils market) wants to acquire Sundara Consumer Brands (≈18%) — two firms retailers see as each other's closest substitute on price and promotion. On 3 August 2026 the 30-day prima-facie clock has expired, the Commission has formed a prima-facie opinion of an Appreciable Adverse Effect on Competition (AAEC), and the case is in Phase II with the 210-working-day outer limit running. You must deliver the substantive competitive-effects assessment the Commission will defend before the NCLAT on appeal. Round 1: define the relevant market with the SSNIP / hypothetical-monopolist test — broad ‘all edible oils’ (shares look modest) or narrow ‘branded sunflower + soyabean refined oils’ (overlap is alarming), national or state-level — knowing market width is contestable and outcome-determinative. Round 2: compute pre/post-merger HHI and the HHI delta (national sunflower oil rises ~1,950 → ~2,920, a +970 delta against +100/+150 review thresholds; three states exceed HHI 3,000), apply the structural presumption, and classify each market as safe / needs-scrutiny / presumptively harmful while distinguishing unilateral from coordinated effects. Round 3: estimate the unilateral price effect from the high diversion ratio and margins (UPP / GUPPI / merger simulation predicts a 6–11% price rise), then discipline the acquirer's ₹900 crore synergies on the three-part standard (merger-specific, verifiable, passed-through) and net credited pass-through against the ₹1,400–2,600 crore consumer-welfare loss. Round 4: recommend unconditional clearance, prohibition, or conditional clearance with a structural divestiture or behavioural conditions, weighing Type I (block a good deal, destroy synergies, invite a successful appeal) against Type II (clear a bad one, raise prices on a staple) error under the deadline, and defend the order to the bench. The math rewards a tested narrow market, an HHI screen used as a trigger not a verdict, an effects estimate that survives appeal, disciplined synergy crediting, and a proportionate structural remedy — and punishes the five classic errors: accepting the parties' broad market, treating high HHI as the verdict, crediting unverified synergies, defaulting to a hard-to-monitor behavioural price cap, and a disproportionate blanket prohibition. Operationalises Viswanath Pingali's empirical-pricing and CCI competition-policy research under the Indian Competition Act, 2002.