Main Supranational Merger Control Regulations Likely To Apply To M&A Transactions In Africa

Most of the African countries have enacted competition law legislations in order to improve market conditions and attract investors. These regimes are very different from one country to another, depending in particular on the history of the country, its culture and whether its legal system is common law or civil law based. It should also be noted that while most of the African competition regimes contain rules addressing anticompetitive practices (e.g., concerted practices, abuse of dominance, State aids), they do not always provide for a merger control regime.

Most of these competition regimes are quite recent and have generally developed as from the very end of the 20th century, some of them still being at the early development stage and requiring improvements, implementing acts or institutions in order to be fully effective.

As in the European Union, several African countries have recently formed regional communities which also have, among their other supranational tasks (e.g., promotion of free trade areas, monetary unions), the power to control concentrations taking place within the territory of their Member States.

In particular, CEMAC1, COMESA2, UEMOA3 and CEDEAO4 are four regional organizations in Africa which have been instrumental in promoting the development of a merger control framework between their Member States. However, as a result of the different legal cultures of their respective Member States, the merger control regimes enacted by these organizations have very different scopes and are based on diverging concepts, both from a procedural (e.g., voluntary or mandatory control, regional authorities and courts5 in charge of the control, prior or subsequent control of concentrations) and substantive point of view (e.g., thresholds, control criteria, remedies, sanctions). It should also be noted that, even within one and the same regional organization, the national merger control legislations of its Member States may be based on totally different concepts.

The purpose of the following comments is to point out some of the key characteristics of such regional merger control regimes of interest to companies involved in M&A deals in Africa, it being noted that each of them contains detailed provisions and raises specific issues that are not being addressed in this short Bulletin.

1. CEMAC

   CEMAC Regulation No.1/99/UEAC-CM-639 of June 25, 1999 provides that concentrations of a community dimension must be subject to a prior notification and merger control review carried out by the CEMAC Organe de Surveillance de la Concurrence (« OSC »). Only concentrations meeting one of the following alternative thresholds6 are considered as being of a community dimension: at least two of the undertakings involved each have a turnover above CFA Francs 1 billion in the Common...