Article 1 of a Monthly Series on Mergers and Acquisitions in Egypt and the Middle East
This is the first article in a monthly series examining key legal and execution themes that increasingly shape mergers and acquisitions (M&A) in Egypt and the Middle East.
The series is written for transaction parties, deal teams, in-house legal functions, and advisers who are directly involved in structuring and delivering transactions, with a focus on how legal developments influence deal design, risk allocation, and execution strategy.
This opening article looks at pre-merger control in Egypt, not as a technical competition law topic, but as a structural feature that now sits firmly within mainstream M&A practice.
Table of contents
- Pre-merger control as a deal structuring issue
- The legal framework and its intent
- When a transaction is caught by the regime
- Review timing and deal momentum
- Implications for transaction documentation
- Competition clearance within the wider regulatory landscape
- The role of specialist competition input
- A final observation
- Author Profile
Pre-merger control as a deal structuring issue
Since 1 June 2024, Egypt has operated a mandatory pre-merger control regime for qualifying transactions. This regime gives the Egyptian Competition Authority (ECA) the power to review certain transactions before they are implemented, and to prohibit or condition them where competition concerns arise.
The importance of this change lies less in the legal concept itself and more in its practical consequences. Competition clearance is no longer something that runs quietly in the background.
It now interacts directly with:
- Transaction sequencing
- Conditionality and long stop mechanics
- Information flows between parties
- Certainty of closing
For M&A practitioners, pre-merger control has become part of the deal architecture, not an external compliance overlay.
The legal framework and its intent
The regime is grounded in amendments to Competition Law No. 3 of 2005, as implemented by Prime Ministerial Decree No. 1120 of 2024. Together, they introduce a formal system of prior notification and approval for transactions that qualify as an economic concentration.
The policy objective is straightforward. The ECA is tasked with assessing whether a proposed transaction is likely to materially restrict competition in a relevant market in Egypt, and whether any such restriction can be addressed through conditions or commitments.
What is new is not the existence of competition scrutiny, but the fact that implementation must now wait until that scrutiny is completed.
When a transaction is caught by the regime
In broad terms, a transaction will require notification to the ECA if it involves a form of control or material influence, and if certain financial thresholds are met.
While the detailed assessment is fact sensitive, the thresholds are built around:
- The combined annual turnover or assets in Egypt of the parties exceeding EGP 900 million, and
- At least two parties each achieving annual turnover in Egypt exceeding EGP 200 million, based on the most recent audited financial year
These figures are deliberately calibrated to capture transactions with meaningful market presence, rather than purely technical or local restructurings.
From a transactional perspective, the key point is not memorizing the numbers, but recognizing that threshold analysis must be done early, and often at group level, well before documentation is finalized.
Review timing and deal momentum
The review framework itself provides indicative timeframes, but these should be treated as reference points rather than guarantees.
In straightforward cases, the ECA may complete its initial review within approximately 30 working days from acceptance of a complete filing. Where the authority identifies potential competition issues, the review can extend by a further 45 working days, and in practice may involve several rounds of information requests.
For deal teams, the significance of these timelines lies in their interaction with transaction momentum. Competition review introduces an external pacing item into the transaction, which must be reflected in:
- Conditionality
- Interim operating arrangements
- Financing and funding assumptions
This is particularly relevant in transactions involving regional or multi-jurisdictional filings, where Egypt becomes one element of a broader regulatory sequence.
Implications for transaction documentation
The impact of pre-merger control is most visible in the drafting and negotiation of the Share Purchase Agreement (SPA).
Competition approval is now typically addressed as a standalone condition precedent, with careful attention paid to:
- Responsibility for preparing and submitting the filing
- Allocation of filing fees and advisory costs
- Cooperation and information sharing obligations
- The consequences of delay, conditions, or refusal
These provisions often become a focal point of negotiation, not because they are novel, but because they directly affect risk allocation between buyer and seller.
At the same time, interim period provisions take on greater importance. Where signing and closing are separated by a regulatory review, parties must balance legitimate business protection with the need to avoid premature integration or coordination.
Competition clearance within the wider regulatory landscape
Pre-merger control does not operate in isolation. In Egypt, competition approval often sits alongside other regulatory approvals that remain fully applicable.
Transactions involving non-banking financial services may require approvals from the Financial Regulatory Authority (FRA), particularly following FRA Decision No. 178 of 2024, which tightened oversight of changes of control in regulated entities.
Public transactions and listed targets continue to be governed by Capital Markets Law No. 95 of 1992, its executive regulations, and Egyptian Exchange requirements.
The practical challenge is not identifying these regimes individually, but coordinating them coherently, so that regulatory processes run in parallel where possible and do not undermine deal timing or certainty.
The role of specialist competition input
As pre-merger control becomes more embedded in transactional practice, it is increasingly clear that competition analysis and M&A structuring must move in step.
In many transactions, early involvement of specialist competition counsel can assist in:
- Confirming whether notification is required
- Shaping transaction structure and sequencing
- Anticipating potential concerns before filing
This input complements, rather than replaces, the central role of M&A counsel in aligning legal requirements with commercial objectives and overall deal strategy.
A final observation
Pre-merger control in Egypt should not be viewed as a barrier to transactions, nor as a purely regulatory hurdle. It is now part of the normal legal environment in which M&A transactions are conceived, negotiated, and implemented.
For practitioners and transaction parties, the real challenge lies in integrating competition considerations into deal planning without allowing them to dominate or derail the transaction narrative.
That balance is where experienced M&A advice adds the most value.
Author Profile
Hatem S. Badr is a Cairo based legal counsel and mergers and acquisitions advisor with extensive experience across banking, finance, and corporate transactions in Egypt and the Middle East. He advises on acquisitions, joint ventures, restructurings, and complex cross border transactions, with a particular focus on deal structuring, transaction execution, and the integration of regulatory considerations into commercially workable M&A solutions. He brings both private practice and senior in-house experience to his advisory work.
The next article in this monthly series will examine another legal and execution theme shaping mergers and acquisitions in the region.
Mr. Hatem Badr
Partner
Banking, Finance & M&A
