Merger regulation should facilitate rather than hinder business transactions. Jurisdictions in Sub Saharan Africa (SSA) need to reformulate their regulations or to adopt regulations that facilitate international business and which also efficiently and effectively achieve their regulatory mandate.
Last Update: 17.01.17
The main objective of merger regulation is to ensure that the post-merger firm does not inhibit competition in the market, thus ensuring that economic efficiency is maintained. The proliferation of merger regulation systems in emerging markets has however been a point of concern owing to the ensuing counter effect to the economic efficiency objective. In addition, questions have been raised regarding the ability of emerging markets to run an efficient merger regulation system in light of their resource and capacity constraints.
The increasing number of merger regulation systems is raising the level of regulatory compliance costs for the concerned undertakings. Add to that the inefficiency of some of the systems and the level of uncertainty goes up , possibly dissuading the undertakings from proceeding with their transactions. Some commentators posit that certain developing and emerging markets may be better off not adopting merger regulation systems owing to constraints in efficiently operating the system. This argument is compounded by the fact that in a number of cases the model chosen as the basis for adoption (which is the EU merger regulation system for many emerging economies) may not be suitable to the market it is directed towards.
Some of the dominant themes include economic development (in some instances within a regional integration perspective), incentivizing Foreign Direct Investment (FDI), or at times from recommendations of international institutions.
Some important questions to ask are hence: How do the merger regulation regimes in SSA fit into the global convergence in merger regulation? Is there a need for redefined merger regulation systems for SSA to take into account the level of economic development? What is the appropriate merger regulation regime?
The core research work of this project is the comparative analysis of the SSA merger regulation systems to that in the US and the EU (which are at the forefront of international convergence) in an effort to answer the above questions. This will be against the backdrop of the ICN, OECD and UNCTAD proposals, guidelines and recommendations which address the core convergence themes. The comparative analysis leads to a normative study of the merger regulation systems and hence determine the level of convergence or divergence from the increasingly converging international standard.
The second core analytical focal point will involve a discussion of development economics where the argument that competition law aids in economic development will be tested by a brief analysis of the impact of merger regulation on particlarly Foreign Direct Investment and other investment initiatives in the region.
The novelty of most of the SSA systems means that there may be absence of case studies in some jurisdictions. In such instances it would be practical to focus the analysis on the merger regulation guidelines which are indicative of how the authority in question would analyze a case before it.
Vincent Angwenyi
Globale Wettbewerbsordnung
