Structure and process, legal regulation and consents

Structure

How are acquisitions and disposals of privately owned companies, businesses or assets structured in your jurisdiction? What might a typical transaction process involve and how long does it usually take?

Acquisition and disposal of Sudanese companies vary according to the type of company. A public joint stock company, unlike private companies in which the public are not entitled to subscribe in shares, the shares should be transferred in Khartoum Stock Exchange through a financial services company (a financial brokerage company dealing with Khartoum Stock Exchange delegated by the selling shareholder). Following the transaction at Khartoum Stock Exchange, it should be registered before the commercial register in a process that normally takes one to two months.

Regarding private companies, the transfer of shares agreement shall be entered into between the parties and submitted along with the form C7 with the Registrar of Companies.

The general rule mandates that movable assets are transferred by possession and fixed assets (eg, real property) are transferred after being notarised before the notary public and registered in the Registrar of Lands.

Legal regulation

Which laws regulate private acquisitions and disposals in your jurisdiction? Must the acquisition of shares in a company, a business or assets be governed by local law?

The applicable law governing acquisitions in Sudan depends on the target sale item (ie, assets or shares). In the sale of shares, the following would be applicable: the Companies Law of 2015, the Khartoum Exchange Law of 2016 and the Investment Law of 2013. In an asset sale, the applicable law would depend on the type of asset. Sudanese law shall prevail in cases of a sale of shares or assets in that the registration process will be subject to the laws of Sudan.

Legal title

What legal title to shares in a company, a business or assets does a buyer acquire? Is this legal title prescribed by law or can the level of assurance be negotiated by a buyer? Does legal title to shares in a company, a business or assets transfer automatically by operation of law? Is there a difference between legal and beneficial title?

Under Sudanese law, there is no distinction between a beneficial and a legal title. Legal and beneficial title of shares are assumed once the transaction is executed via the Khartoum Stock Exchange or the Registrar of Companies. The process is different in assets, whereby the general rule mandates that movable assets are transferred by possession and fixed assets (eg, real property) are transferred after being notarised before the notary public and registered in the Registrar of Lands.

Multiple sellers

Specifically in relation to the acquisition or disposal of shares in a company, where there are multiple sellers, must everyone agree to sell for the buyer to acquire all shares? If not, how can minority sellers that refuse to sell be squeezed out or dragged along by a buyer?

Sudanese law does not explicitly prohibit the concept of drag along clauses, and hence it may be covered under the shareholder agreement or the articles of association.

Exclusion of assets or liabilities

Specifically in relation to the acquisition or disposal of a business, are there any assets or liabilities that cannot be excluded from the transaction by agreement between the parties? Are there any consents commonly required to be obtained or notifications to be made in order to effect the transfer of assets or liabilities in a business transfer?

The acquisition of shares shall neither affect ‘the rights and liabilities of the merged companies nor any legal proceedings undertaken by or against any of the merged companies’. Pursuant to article 14 of the Banking Law of 2004, the approval of the Central Bank of Sudan is required for any merger of a Sudanese bank .

Generally, there are no required consents or notifications to effect the transfer of assets or liabilities.

Consents

Are there any legal, regulatory or governmental restrictions on the transfer of shares in a company, a business or assets in your jurisdiction? Do transactions in particular industries require consent from specific regulators or a governmental body? Are transactions commonly subject to any public or national interest considerations?

In cases where the assignor is a juristic person, the transfer of shares requires the approval of the board of directors. However, there are no approvals required where the assignor is a natural person. As for the sale of assets, generally there are no required approvals.

Are any other third-party consents commonly required?

Yes, in cases where the articles of association require it. Further, some of the company’s material documents might include a change of ownership or control clauses whereby the prior consent of such party is required.

Regulatory filings

Must regulatory filings be made or registration (or other official) fees paid to acquire shares in a company, a business or assets in your jurisdiction?

Administrative fees shall be paid in cases of a transfer of shares. As for the assets, administrative fees and taxes are imposed.