An analysis of the merger in the united arab emirates

The thresholds are comparatively high and differ depending on the sector. In addition to the ambiguity regarding calculating the total transactions in a relevant market and the market share of the establishments therein, the availability of information is an issue.

Once the committee receives the application, it has 90 days — which may be extended by an additional 45 days — to review the transaction and make its decision. However, it is uncertain whether: Moreover, it remains to be seen whether the committee will make its decisions public or issue them only to the concerned parties.

Therefore, it is difficult for the parties to a transaction to determine whether the envisaged transaction will require committee approval. Depending on how narrow the scope is, the size or volume of a relevant market may differ considerably. How this market share will be ascertained is not defined by the law.

Register for a free subscription. Remaining issues The two resolutions passed in have brought some much-needed clarity to the UAE competition regime.

The notary public will usually be reluctant to notarise extensive agreements and deny approval of a transaction based on comprehensive sale and purchase or merger agreements as they are commonly used for instance in western jurisdictions.

Thus, depending on how the relevant market is defined in respect of product and geography, mergers of comparatively small enterprises or only extremely An analysis of the merger in the united arab emirates transactions may require committee approval.

However, agreements which have little effect are exempt from this restriction. Dominant position — establishments dominant in a specific market are prohibited from taking advantage of their dominant position to breach, minimise or exclude competition — for example, by undertaking practices such as price fixing.

To ensure that they do not violate the merger regulations, parties should consider involving the committee at an early stage if they suspect that the envisaged transaction may require approval.

Any transfer of shares in or merger of companies registered in the United Arab Emirates requires approval from the competent administrative authorities. Further, the fees that the committee may charge for processing applications have not been determined by law or regulation.

While the relevant cabinet resolution has not yet been made publicly available, the committee has been appointed and convened at least four times.

The application of the law and related regulations is overseen by the Competition Regulation Committee, which is under the authority of the Ministry of Economy. Again, further guidance in this regard would be helpful. These transactions fall within the competition law regime where they enable a person or group of persons to exercise control over another person or group of persons.

Thus, defining the relevant market is imperative in order to determine whether an economic concentration constitutes a notifiable transaction and requires approval. This definition distinguishes between enterprises by applying different thresholds for the trading, manufacturing and services sectors.

The regulation of restrictive agreements and the conduct of establishments in dominant market positions will be relevant mostly in commercial transactions. In addition, the parties to the transaction will conclude a separate agreement, which comprises the full commercial terms of the deal.

These issues were recently addressed by the legislature through two cabinet resolutions: During the review period, the parties may not carry out actions to execute the proposed transaction.

Merger control in United Arab Emirates

The committee will likely — in line with the practice of the notary public — require only the official transfer or merger agreement to be notarised by the notary public. Economic concentrations — where a proposed economic concentration may affect competition in a specific market, particularly where the concentration would create or enhance a dominant position, an application for approval should be submitted to the committee before concluding the relevant contract.

The committee has discretion to outright approve or reject the proposed transaction or grant conditional approval, subject to the parties to the transaction complying with conditions set by the committee.

For certain sectors, specific regulations on competition exist. However, considerable uncertainty remains with respect relevant issues. This exemption will likely be of little relevance with respect to merger control with participation involving foreigners. Typically, competition law regimes determine a relevant market based on two parameters: It remains to be seen whether the Federal Competitiveness and Statistics Authority, which was recently set up to compile and publish economic data, will be a useful source of market share information in the future.

To date, it is unclear whether the committee is fully operational and whether it is accepting applications for exemptions or pre-approvals.

In particular, it is unclear whether the basis for calculating the total transactions in the relevant market and the market share of the parties merging should be determined with reference to the value monetary turnover or the volume amount of goods or services sold of the relevant transactions.

For example, a business in the manufacturing sector will qualify as a medium-sized enterprise if it has no more than employees or its annual revenues does not exceed Dh million. Due to the lack of publicly available official economic data, determining the value or volume of transactions in a relevant market will be extremely difficult.

Under the newly amended competition law regime, the following practices are prohibited:Deloitte advises corporate buyers and private equity investors throughout the entire M&A deal life cycle.

Our end-to-end merger, acquisition and divestiture advisory services are customized to meet the unique needs of each of our clients. Public mergers and acquisitions in United Arab Emirates: overviewby Sameer Huda and Nick Jennings, Hadef & Partners LLC Related Content Law stated as at 01 Mar • United Arab EmiratesA Q&A guide to public mergers and acquisitions law in the United Arab country-specific Q&A looks at current market activity; the regulation of.

UAE Merger Control Update: Behold the Threshold(s) as per UAE Cabinet resolution setting filing thresholds. The Federal Cabinet of the United Arab Emirates has recently issued Cabinet Resolution No. 13 of (the Cabinet Resolution), which sets out the percentages and thresholds related to the implementation of analysis or explanation.

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Mergers & Acquisitions

Pilomat References Middle East Trip. Tourism in UAE Table + of Contents Introduction • • Overview. UAE Merger Control Update: Implementing Regulations Now In Force. Doing Business in the United Arab Emirates – Understanding the Abu Dhabi and Dubai Laws and Legal System: Latham & Watkins February 2, | Number | Page 3 analysis or explanation of the subject matter be required, please contact the lawyer with whom you.

Merger and Acquisition in the United Arab Emirates and its effect on the organizational growth, productivity, and competitive advantage Larissa Zaplatinskaia September 20, Introduction Over past five years there have been dramatic rise in the number of mergers and acquisition.

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An analysis of the merger in the united arab emirates
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