Notification and clearance timetable

Filing formalities

What are the deadlines for filing? Are there sanctions for not filing and are they applied in practice?

The transaction must be notified to the Competition Council before its completion, as soon as the parties concerned are able to present a sufficiently concrete file to allow the investigation of the case and, in particular, when they have entered into an agreement in principle, signed a letter of intent, or as of the announcement of a public offer.

The sanctions for not filing are as follows:

  • for legal entities responsible for filing: a fine amounting to a maximum of 5 per cent of the pre-tax turnover made in Morocco during the last fully closed financial year, increased, when applicable, by the turnover made in Morocco during the same period by the acquired company; and
  • for natural persons responsible for filing: a fine of a maximum amount of 5 million dirhams.

Moreover, upon failure to file a notification, the Competition Council compels the parties, subject to a daily penalty payment, to notify the operation, unless they revert to the previous state of affairs.

Which parties are responsible for filing and are filing fees required?

This notification obligation is the responsibility of the natural or legal persons who acquire control of all or part of an undertaking or, in the case of a merger or the creation of a joint venture, of all parties concerned, who must then notify jointly.

There are no filing fees.

What are the waiting periods and does implementation of the transaction have to be suspended prior to clearance?

The Competition Council must rule on the transaction within 60 days of receipt of the complete notification file (Phase I). In case of opening of an in-depth investigative phase, the Competition Council has 90 additional days to take its decision (Phase II). These time limits may be extended or suspended in the cases listed in question 18.

Under article 12 of the Competition Law, the filing has a suspensive effect. The parties are thus not entitled to implement their concentration plan as long as the Competition Council (or the administration, if it takes on the case) has not authorised the transaction.

Nevertheless, in case of duly motivated need, the parties can ask the Competition Council for an exemption to this suspensive effect, allowing them to actually complete all or part of the transaction without waiting for an authorisation decision of the competition authorities and without prejudice of this decision (article 14, paragraph 2 of the Competition Law).

Pre-clearance closing

What are the possible sanctions involved in closing or integrating the activities of the merging businesses before clearance and are they applied in practice?

According to article 19 of the Competition Law, closing a concentration before clearance may lead to the application of the fines imposed for failure to file a concentration as set out in question 9.

Are sanctions applied in cases involving closing before clearance in foreign-to-foreign mergers?

No specific rules concerning the sanctions to apply in cases involving closing before clearance in foreign-to-foreign mergers are established by the Moroccan competition legislation and the sanctions for closing before clearance set out in question 12 should be applicable in these cases.

What solutions might be acceptable to permit closing before clearance in a foreign-to-foreign merger?

Moroccan legislation provides no specific solutions permitting closing before clearance in a foreign-to-foreign merger.

In case of duly motivated need, the parties to a foreign-to-foreign merger can, however, ask the Competition Council for an exemption to the suspensive effect to allow them to close the transaction before clearance (article 14, paragraph 2 of the Competition Law).

Public takeovers

Are there any special merger control rules applicable to public takeover bids?

No specific merger rules are applicable to public takeover bids. The Competition Council seems to apply the general rules and principles of the Moroccan legislation to assess such concentration, as illustrated in its Opinion No. 9/10 relating to the public takeover bid launched by Kraft Foods Inc over Cadbury Plc.

Documentation

What is the level of detail required in the preparation of a filing, and are there sanctions for supplying wrong or missing information?

The notification file submitted to the Competition Council must contain specific information and documents listed in the Decree as regards:

  • the contemplated operation (including a copy of the agreement subject to the notification);
  • the undertakings concerned and the groups to which they belong (including in particular their annual accounts, a list of their main shareholders, etc);
  • a presentation of the relevant product and geographic markets concerned (including the markets shares of the parties); and
  • when a market is affected, a detailed presentation of this market and of the firms active in this market (including the market shares of the parties).

A market is considered to be affected when:

  • one or more undertakings operate on the concerned market and have an aggregated market share reaching 25 per cent or more;
  • at least one of the concerned undertakings operates on the concerned market and another of the concerned undertakings operates on the upstream, downstream or associated market, whether or not there exist supplier relations, as long as all the concerned undertakings reach a 25 per cent market share; or
  • the operation leads to the eviction of a potential competitor on the market.

In case of wrong or missing information in the notification file, the Competition Council can impose the fines for failure to file a concentration as set out in question 9 and also withdraw its authorisation decision. Unless the parties revert to the previous state of affairs, they must once again notify the transaction within one month from the withdrawal of the decision.

Investigation phases and timetable

What are the typical steps and different phases of the investigation?

Upon receiving a notification file, the Competition Council must publish a release containing, in particular, a non-confidential summary of the transaction and the time frame in which interested third parties are invited to make observations.

During Phase I, the Competition Council will examine the file and designate a case officer to follow up the file and conduct the investigation.

If the Competition Council considers, at the end of Phase I, that serious doubts remain as to the risk of infringing competition (or at the request of the governmental authority in charge of competition), a Phase II investigation is opened to conduct an in-depth analysis of the transaction.

During Phase II, a report is sent to the parties and to the Government Commissioner. This report contains a statement of the facts as well as the elements of information on the basis of which the case officer has based its analysis and the observations of the parties, if any.

Hearings at the Competition Council are not public. Only the concerned parties and the Government Commissioner may attend such hearings. The Competition Council may also hear all persons in a position to contribute information on the case.

At the end of Phase II, a draft of the decision is communicated to the concerned parties who may present their observations within 10 days.

What is the statutory timetable for clearance? Can it be speeded up?

The timetable for clearance is as follows:

Phase I (60 days)

According to article 15 of the Competition Law, the Competition Council must rule on the transaction within 60 days of receipt of the complete notification file.

If commitments are offered by the parties, this 60-day time limit is extended by 20 days.

In case of particular necessity, such as the finalisation of the commitments, the parties may ask the Competition Council to suspend the deadline for a maximum of 20 days.

At the end of Phase I, the Competition Council may either:

  • decide that the notified transaction does not fall under the scope of the merger control;
  • authorise the operation subject, where applicable, to the effective implementation of the remedies proposed by the notifying parties;
  • open an in-depth analysis of the transaction (Phase II) if it finds that serious doubts remain as to the risk of infringing competition; or
  • refrain from adopting any of the above decisions.

Within 20 days after having received a copy of the decision or having been informed of it by the Competition Council, the governmental authority in charge of competition may ask the Council to open a Phase II investigation.

The transaction is deemed to be authorised upon the conclusion of this 20-day time limit.

Phase II (90 days)

According to article 17 of the Competition Law, the Competition Council must determine within 90 days whether the transaction is likely to infringe competition, notably by creating or strengthening a dominant position or a buying power that places suppliers in a position of economic dependency. The Competition Council also assesses whether the contemplated transaction brings a sufficient contribution to economic progress to offset the competition infringements.

If the notifying parties offer commitments to remedy the anticompetitive effects of the contemplated operation less than 30 days before the end of the 90-day deadline, the deadline will then expire 30 days after the reception of the commitments. Moreover, the 90-day deadline may be suspended for up to 30 days at the parties’ request in case of particular necessity, notably to finalise their commitments.

The deadline may also be suspended by the Competition Council, in particular when the notifying parties have failed to provide it with the requested information or to inform it of the occurrence of a new material event. The time limit resumes when the cause of the suspension has been addressed.

The Competition Council may, at the end of the Phase II, either:

  • authorise the operation subject to, where applicable, the effective implementation of commitments offered by the notifying parties;
  • authorise the operation, while requiring the parties to take all appropriate measures to ensure sufficient competition or to comply with instructions destined to provide a sufficient contribution to economic progress to offset the competition infringements; or
  • prohibit the concentration and require the parties, when applicable, to take all appropriate measures to re-establish sufficient competition.

Upon receiving a copy of the decision or being informed of it by the Competition Council, the Chief of Government, or the delegated governmental authority, may within 30 days exert its power and issue a decision on the transaction for reasons of public interest (such as industrial development, competitiveness of the companies within the international context or job creation).

The transaction is deemed to be authorised when this 30-day time limit has expired.

The Moroccan competition legislation does not contain any accelerated procedure.