A new start for COMESA

Merger filing thresholds introduced and filing fees reduced.

The COMESA Competition Commission (the CCC) announced on 8 April 2015 that the Council of Ministers of the COMESA member states has approved the introduction of long-awaited monetary filing thresholds and a scaling down of merger filing fees. These changes address two of the key concerns voiced by the legal and business community since COMESA’s merger control regime entered into force in January 2013. In addition, a revised filing form has been adopted.

Monetary merger filing thresholds

The Rules on the Determination of Merger Notification Thresholds and Method of Calculation (the Rules on Filing Thresholds) repeal the "zero" thresholds rule and introduce a three-prong test. A merger is now notifiable to COMESA if:

  • the combined annual turnover or assets, whichever is higher, in COMESA of all parties to the merger equals or exceeds $50m; and
  • the annual turnover or assets, whichever is higher, in COMESA of each of two of the parties to the merger equals or exceeds $10m; and

provided each of the parties to the merger do not achieve two-thirds of its COMESA turnover or assets in COMESA within one and the same member state.

The thresholds are modelled on European merger control rules, with the notable difference that the first part of the test is a combined regional threshold (instead of the combined worldwide threshold which applies under EU law). Whilst significantly lower than EU thresholds, the COMESA thresholds attempt to reflect the size of the region’s economic activity and to catch only such transactions expected to have an appreciable effect on trade and restrict competition in the COMESA region. As a result, merging parties with turnover/assets below these prescribed thresholds (or with two-thirds or more of their turnover in one and the same COMESA member state) are no longer subject to a filing to the CCC. However, in these circumstances, a filing to national competition authorities may be needed in those COMESA member states with merger filing requirements. It is therefore important to keep in mind that transactions below COMESA thresholds will not exempt merging parties from any filing obligation under applicable national rules.

Key points to note as regards these new thresholds:

  • For businesses with turnover or assets in excess of $50m and planning to invest in the COMESA region, a stand-alone acquisition of a target with COMESA turnover or assets of at least $10m will meet the new thresholds, unless the parties generate two-thirds or more of their COMESA turnover from (or have more than two-thirds of their COMESA assets in) the same member state. These remain relatively low thresholds for large businesses but should make a notable difference for medium-size companies. 
  • The monetary thresholds must be read in conjunction with the other filing requirements contained in the COMESA Competition Regulations 2004 (the Regulations). This means that, in addition to the monetary thresholds set out above, a merger will be notifiable only if at least one of the merging parties operates in two or more COMESA member states. 
  • The new Rules on Filing Thresholds should also be read in conjunction with the COMESA Merger Assessment Guidelines adopted by the CCC in October 2014 (the Guidelines). The purpose of the Guidelines was to provide guidance on what constitutes a ‘notifiable’ merger and has had the effect of introducing a narrower reading of COMESA’s merger filing requirements, pending adoption of the new monetary thresholds. It is unclear at this stage if and when the CCC will amend its Guidelines to reflect the adoption of monetary thresholds. In the meantime and until announced otherwise by the CCC, it should be possible to rely on the Guidelines to narrow down even further the merger filing obligation. For example, a merger in which the prescribed monetary thresholds are met would not be notifiable pursuant to the Guidelines if none of the parties have turnover in excess of $5m in each of at least two COMESA member states. This is because the Guidelines provide that the CCC will only consider that a party "operates" in a member state if it has turnover in excess of $5m. 

The Rules on Filing Thresholds also provide welcome clarification on the concept and the calculation method of turnover and assets. For example, the new rules make clear that, as regards partial acquisitions, only the turnover/assets of the parts being acquired will be taken into account with regard to the seller.

Reduced merger filing fees

The COMESA Council of Ministers has scaled down the applicable merger filing fees. The filing fee is now calculated at 0.1 per cent (instead of 0.5 per cent) of the combined annual turnover or combined asset value (whichever is higher) of the merging parties in the COMESA region, capped at a maximum fee of $200,000 (instead of $500,000).

This means therefore that parties to a merger with a combined COMESA turnover (or assets) of at least $200m will pay the maximum fee of $200,000 but no more. Under the previous calculations, this same filing fee of $200,000 was payable for transactions in which parties achieved a combined COMESA turnover of only $40m. Although the absolute amount remains significant, businesses with turnover above $200m with plans to acquire in the COMESA region will therefore see the applicable filing fee reduced by 60 per cent.

The realignment of filing fees, combined with the introduction of monetary thresholds, are expected to reduce COMESA’s merger filing revenues, part of which is paid back to COMESA member states. Indeed, under the revenue sharing formula agreed amongst COMESA member states, 50 per cent of the filing fees received by the CCC is kept by the CCC and the other half goes back to the member states affected by the merger. In 2014, the CCC received 44 notifications earning $10.6m. Egypt received back the highest share of fees estimated at $0.94m, followed by Zambia with $0.82m. Conversely COMESA member states with merger control regimes and applicable filing fees may see local merger filings and revenues increase as a result of these amendments.

Entry into force

The amendments to the rules on merger filing thresholds and filing fees were made by the Board of Commissioners and approved by the Council of Ministers on 26 March 2015 and entered into force on the same date.


The new monetary thresholds and scaling down of filing fees should reduce the administrative and financial burden for businesses investing in the COMESA region. Two years following entry into force of its merger control regime, COMESA should be commended for taking into account observations from stakeholders, the business community and international recommended standards to adopt more realistic tools to measure conditions to filing and applicable fees. COMESA will no doubt gain in credibility as a result. Nevertheless as national merger control regimes continue to emerge in the COMESA region (over half of the 19 member states in the COMESA region now have a merger control regime in place), businesses should not lose sight of the fact that those transactions now exempted from a COMESA filing might instead be subject to filing with one or more national competition authorities in the COMESA region. Whether enforced by the CCC or national competition authorities, merger control rules in the COMESA region should therefore continue to be on businesses’ global regulatory map.