Companies to pay for non-notification of mergers


Companies Involved in mergers which have an effect on trade in the Common Market for Eastern and Southern Africa (Comesa) risk paying 10 percent of their annual turnover as a penalty to the Comesa Competition Commission if they fail to notify the regional body of the transaction within 30 days as set out in the guidelines for mergers in the region.

Last year, the commission, which sits in Lilongwe, reduced merger notification fees to $200,000 from $500,000, calculated at 0.1percent of the combined assets or turnover whichever is higher in the Common Market. Before, it was 0.5 percent of the combined assets or turnover. The revision was done as part of efforts to support the regional integration agenda.

But Head of Mergers and Acquisitions at the Comesa Competition Commission, Willard Mwemba, said there are still instances where the Commission hears of mergers taking place through media reports, an indication that some companies are still making transactions without seeking approval from the Comesa Commission, the body responsible for enforcing merger control in the Common Market.


A notifiable merger is supposed to be notified to the Comesa Competition Commission within 30 days of the parties’ decision to merge.

“Failure to do so is an infraction of the regulations and may attract penalties including a maximum of 10 percent of the annual turnover of the parties. Further, a merger implemented without notification is null and void and no rights and obligations imposed on or by the participating parties shall be legally enforceable in the Common Market,” Mwemba said in an emailed response.

The commission has so far handled more than 100 merger transactions assessed since its inception in 2013, corresponding to turnover of over $19 billion.


In 2015 alone, more than 72 mergers worth over $20 million were approved, 20 of which involved Malawi.

The transactions assessed and approved for Malawi include Old Mutual Africa Holdings versus Oceanic Insurance, Fedex Corporation and Supa Swift Malawi and International Hotel Licensing Company versus the Protea Group of Companies.

Only mergers that have a regional dimension are notifiable to the Comesa Competition Commission where both the acquiring firm and the target firm or either the acquiring firm or target firm operate in two or more Comesa member states.

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