What jurisdictional thresholds trigger a review or application of the law? Is filing mandatory?
There are no particular thresholds that trigger a review or clearance. Any non-Jordanian entity or individual wishing to carry out business in Jordan should register with the CCD, whether by acquiring part or all of an existing Jordanian company or by incorporating a new one. Depending on the sector in which the relevant Jordanian company carries out its activities, there may be certain limitations on the investor’s contemplated investment (see question 3).
An investor should submit the required documentation to the CCD for filing in the relevant company’s folder. Such documents include the relevant share transfer forms and corporate documents and authorisations (for corporate investors) and personal identification documentation (for individual investors). If ‘national interest’ clearance is required, the CCD would liaise with the relevant government or security department to obtain such clearance, the department may request further information from the relevant investor.
As for competition clearances, the approval of the Minister of Industry and Trade may be required if the transaction is deemed an economic concentration that may affect competition in the Jordanian market or if the total market share of the entities involved exceeds 40 per cent. In such an event, submission of certain information or documentation to the Competition Directorate is required as part of the application for the approval.National interest clearance
What is the procedure for obtaining national interest clearance of transactions and other investments? Are there any filing fees?
Upon submitting an application for incorporating or investing in a Jordanian company, the CCD may, depending on the sector and the nationality of the investor, seek the approval of certain security departments (usually, the Ministry of Interior) as well as any other relevant regulatory body (for technical and other purposes). Typically, such approvals are sought simultaneously, whereby a letter is directly issued by the CCD to such authorities and completion of the registration procedure will be stalled pending receipt of the necessary approvals.
The parties are not required to fill out any particular standard forms other than those required for registration with the CCD. Certain authorities may, at their discretion, request additional information to be provided by the relevant investor.
With respect to obtaining a competition clearance, the investor and the target shall submit an application (in the form adopted by the Ministry of Industry and Trade) to the Competition Directorate within 30 days of the date of execution of the economic concentration agreement (the share purchase agreement, merger agreement, etc), attaching thereto the necessary documentation or information.
The Competition Directorate has the right to request in writing any further information or documentation in connection with the economic concentration agreement and the parties involved. Such request must be made within 60 days of the date of submission of the application mentioned above. The Competition Directorate shall then be obliged to issue a notice confirming completion of submission of the information and documentation provided that such issuance shall not prejudice the Competition Directorate’s right to request further information or exercise its supervisory authority. In the event that the information and documentation were complete at the time of submission of the application, the Competition Directorate must issue the notice confirming completion of submission of the information and documentation within 60 days of the date of the application.
The Competition Directorate shall, at the applicants’ cost, announce the submitted application of the economic concentration in two local daily newspapers. The publication must describe the subject matter of the application and invite any person with interest to provide his or her opinion within 15 days of the date of publication. The Minister may, after consultation with the relevant authorities and parties, take any precautionary procedures until the issuance of a decision on the submitted application.
The Minister may, upon the recommendation of the Competition Directorate’s manager, issue a reasoned decision on the submitted application within 100 days of the date of issuance of the notice for completion of submission. The Minister shall attach to his or her decision a report containing a summary of the economic concentration and its impact on the competition in the market, including the economic impact and the terms and conditions of the obligations assumed by the parties (if any). Such decision and summary shall be published in at least two daily local newspapers.
Other than the usual fees and stamp duties for the registration of companies or, as the case may be, the transfer of shares in companies, there are no specified national interest filing fees for any of the above clearances.
Which party is responsible for securing approval?
The investor submits the application to the CCD. Although any national interest approvals are coordinated internally between the relevant authorities, it is the investor’s responsibility to provide the required documentation or information and to follow up with such authorities.
Both the investor and target may be required to secure competition approval.Review process
How long does the review process take? What factors determine the timelines for clearance? Are there any exemptions, or any expedited or ‘fast-track’ options?
Approvals sought from authorities other than security departments are typically provided within five to seven business days.
Approvals from security departments are procured on a case-by-case basis and certain factors such as the nationality of the investor, and any of its related parties could trigger different levels of scrutiny and timelines.
There are no exemptions or expedited ‘fast-track’ options. However, in practice, the investor, or its authorised representative, may directly follow up with the relevant authorities to enquire on the status of the process and push for the quick issuance of the approvals.
The Competition Law provides that a formal application to the Competition Directorate can take up to 160 days before the Minister of Industry and Trade issues a decision approving a transaction for competition purposes.
Must the review be completed before the parties can close the transaction? What are the penalties or other consequences if the parties implement the transaction before clearance is obtained?
Given that registration can only take place before the CCD, the transaction cannot be closed prior to the procurement of the approval letters.
As for the competition clearance, the approval of the Minister of Industry and Trade should be obtained prior to completing the transaction. However, if the parties implement the transaction before the clearance is obtained, the Minister may take any procedures he or she deems appropriate (which may include reversing the transaction) with respect to any economic concentration where no application has been submitted or if it violates the provisions of the Competition Law. Each party may, also, be required to pay a fine of no less than 10,000 dinars and not more than 50,000 dinars.Involvement of authorities
Can formal or informal guidance from the authorities be obtained prior to a filing being made? Do the authorities expect pre-filing dialogue or meetings?
Some public officials may give informal guidance on the review process via pre-filing dialogues or meetings. However, such guidance may not be entirely accurate. Certain authorities refuse to give any form of guidance prior to filing an official application.
When are government relations, public affairs, lobbying or other specialists made use of to support the review of a transaction by the authorities? Are there any other lawful informal procedures to facilitate or expedite clearance?
There are no such specialists.
What post-closing or retroactive powers do the authorities have to review, challenge or unwind a transaction that was not otherwise subject to pre-merger review?
None, other than the powers granted to the Minister of Industry and Trade to take any action necessary if his or her approval is not sought prior to closing a transaction in contravention of the Competition Law.