1. Now that the Federal Competition and Consumer Protection Bill has been passed will I still file with the Commission for the approval of a Merger?
The role of the Commission in relation to Mergers will now be in the exercise of its primary function as the regulator of the capital market. The regulatory purview of the Commission will be restricted to mergers and acquisitions by or involving public companies as well as transactions involving a change of shareholding of capital market operators.
2. If a private company is to be merged with or acquired by a public company, is there a need to obtain the No Objection of the Commission?
Yes. Where any merger or acquisition involves a public company, the public company has a duty to obtain the No Objection of the Commission.
3. Will the issuance of a No Objection by the Commission and the requirement to secure the approval of the Federal Competition and Consumer Protection not amount to double approval for the same transaction?
No. The review and approval by the Commission on mergers will be restricted to the objective captured in Section 121(1) (d) of the Investments and Securities Act, which is to ‘determine whether all shareholders are fairly, equitably and similarly treated and given sufficient information regarding the merger’ as well as other statutory mandates of the Commission. The Federal Competition and Consumer Protection Commission on the other hand will consider the anti-competitive effects of a transaction in a relevant market.
4. What will be the implication of a transaction which results in the acquisition of control of a public listed company?
It should be noted that the provisions and application of Sections 131-151 of the Investments and Securities Act, 2007 remain unaffected by the enactment of the Federal Competition and Consumer Protection Act. Consequently, the Commission will continue to enforce compliance with the takeover provisions and monitor acquisition of shares of public companies.
5. At what stage will a company be expected to obtain the No Objection of the Commission? will this be before or after obtaining the approval of the Federal Competition and Consumer Protection Commission?
As with most jurisdictions, mergers may require a number of regulatory approvals from different authorities. Subject to the requirements of the Federal Competition and Consumer Protection Commission, the order in which parties choose to obtain approval is entirely discretionary and may be governed by the transaction timelines of the parties and the processing time of each regulator.
6. How will corporate restructurings be handled going forward?
In keeping with the practice, every public company undertaking a proposal, scheme, transaction, arrangement, or activity or issue of securities or offer for subscription or purchase of securities in relation to:
The conversion of a public company or the reconstruction of it shares;
a carve-out, spin-off, split-off or other form of restructuring of its operations;
The acquisition or disposal of asset which results in a significant change in the business direction or policy of a public company or any other listed entity whether or not in relation to any proposal, scheme, transaction, arrangement or activity;
shall obtain the No Objection of the Commission.
7. I have already filed an application with the Commission for approval. Will I be required to file afresh with the Federal Competition and Consumer Protection Commission?
No. every complete application filed with the Commission prior to the effective date of the Federal Competition and Consumer Protection Act and for which appropriate processing fees had been paid would be continued and completed.
8. Will the Fees remain the same for public companies obtaining the No Objection of the Commission?
No. A new fee regime will be prescribed and published on the website of the Commission
Further questions or clarifications on any issue which has not been addressed above, may be directed to firstname.lastname@example.org and email@example.com