Study of economic request

Concentration Review Mechanisms

To maintain the normal competitive course of the national market, the Law has entitled GAC to monitor economic concentration transactions. To achieve such purpose, the Law obligates a firm to notify GAC prior to any economic concentration transaction if such transaction would result in a dominant position. Article Six of the Law provides for the following:

1. Firms involved in merger operations or firms desiring to acquire assets, proprietary rights, usufructs or shares, which causes them to be in a dominant position, shall notify GAC in writing at least sixty days prior to completion of the same.

2. Competing firms desiring to combine two or more managements into one joint management shall, if that results in a dominant position, notify GAC in writing at least sixty days prior to completion of the same.

3. The Regulations shall specify times of such notification, its form and content, information and documents required, procedures to be followed in submitting it as well as the due fees for the inspection thereof.

4. GAC may review all necessary information prior to issuing a Resolution of approval or rejection of the notification submitted thereto, in accordance with the provisions of Paragraphs (1) and (2) above, giving justifications therefor in each case.

The procedures of submitting an economic concentration application can be summarized as follows:

• The merging firm files an application for approval of the implementation of the economic concentration transaction through the e-service, on the GAC’s website;
• Based on the information provided by the firm, GAC representatives shall contact the applicant within 5 working days to notify him of subsequent procedures.
• After the GAC’s experts review the data provided by the applicant and decide that the merging firms do not represent a major economic concentration for the market, the applicant firm shall be given a notice by GAC indicating non-objection to the implementation of the economic concentration transaction.
• In case GAC decides that it is necessary to conduct a prolonged review of the economic concentration application, the applicant will be requested to provide more information regarding the merging firms and the relevant market. GAC will carry out an extensive economic review of such application within a period not exceeding 90 days as of the date of receiving the application, including many inputs, namely:

1. Revenues of the firms participating in the economic concentration transaction;
2. Market share of the firms before and after the economic concentration;
3. Public views after publishing the economic concentration application in newspapers;
4. Views of the clients of firms with regard to the economic concentration application;
5. Views of the competing firms concerning the economic concentration application;
6. Views of the related governmental entities with regard to the economic concentration.

 After completing the economic review, and based on its outcomes, GAC will submit a report to the Board of Directors, including one of the following options:
a. Unconditional Approval
b. Conditional Approval
c. Rejection

After the issuance of the Board of Directors’ resolution, the applicant firm will be notified of such resolution.