MCA Proposes Expansion Of Fast-Track Merger Route Under Companies Act

The Ministry of Corporate Affairs (MCA) has released draft amendments to the Companies (Compromises, Arrangements and Amalgamations) Rules, 2025, aiming to broaden eligibility for fast-track mergers under Section 233 of the Companies Act, 2013.

The proposed changes follow the Union Budget 2025–26 announcements to simplify merger procedures. Currently, fast-track routes apply to mergers between small companies, start-ups, and wholly-owned subsidiaries. The draft rules suggest including more classes of unlisted entities with debt under this route. Approvals under this mechanism are handled by Regional Directors, unlike the regular merger route requiring the National Company Law Tribunal’s involvement.

Experts indicate that while the proposal may ease the process, its impact depends on removing procedural ambiguities and ensuring clear criteria for inclusion under the fast-track route.