CAIRO - 26 May 2024: The Egyptian Competition Authority (ECA) has announced the implementation of an ex-ante merger control system starting from June 2024. This was revealed by the Chairman of the ECA, Mahmoud Momtaz, during a press conference.
The primary objectives of this new system are to achieve legal certainty and maintain market stability.
The ex-ante merger control regime plays a crucial role in fostering domestic and foreign investments, eliminating obstacles to entering and expanding markets, and bolstering the competitiveness of market frameworks.
This announcement came after legal amendments were made to the Egyptian Competition Law (ECL) under the provisions of Law No. 175 of 2022, and the corresponding Executive Regulations issued by the Prime Minister's Decree No. 1120 of 2024.
These recent amendments have expanded the ECA's responsibilities to include ex-ante control over economic concentrations, such as mergers and acquisitions.
The Executive Regulations provide clarity on important implementation details, including criteria for calculating turnover, notification requirements, and guidelines for assessing the competitive impact of economic concentrations.
Momtaz emphasized that this law aims to diversify the production structures of the Egyptian economy, encourage small and medium-sized enterprises (SMEs), and enhance consumer welfare.
The ECA may authorize an economic concentration in certain cases, such as if it is proven that the concentration will result in efficiencies that outweigh the effects of reduced competition, or if non-implementation would lead to entities exiting the market.
The authority has established fast and transparent review processes for notified economic concentrations, with over 95 percent of notifications successfully processed in the initial phase within 30 working days.
The ECA also ensures the confidentiality of submitted data and has practical experience in ex-ante merger control, particularly in the healthcare and pharmaceutical sectors.
During 2023-2024, the ECA took an average of 15 working days to examine over 800 healthcare-related notification files, with 72 percent completed within 10-15 days. The ECA also reviews notifications for COMESA mergers and acquisitions.
Following the enactment of the 2022 competition law amendments, the ECA has taken several measures to enforce the new provisions, including establishing a specialized "Economic Concentrations Department" with a technical team and developing a streamlined workflow for handling economic concentration cases.
Additionally, they have finalized an economic concentration notification form in Arabic and English, provided comprehensive guidelines on applying the economic concentration control provisions, and published FAQs related to the new ex-ante merger control regime.
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