Mergers and Monopolies

The Competition and Consumer Authority’s mandate with respect to the regulation of Mergers and Acquisitions is to administer the provisions of Part XI of the Competition Act, through investigating and analysing mergers with the view to authorising (with or without conditions), prohibiting or referring the notified merges.

For the purposes of the Competition Act 2018, a merger occurs when one or more enterprises directly or indirectly acquires or establishes direct or indirect control over the whole or part of the business of another enterprise.

Mergers and Acquisitions Control Process

From an economic point of view, mergers have an immediate effect on the structure of the market, and prohibiting potentially anti-competitive mergers is an effective way to prevent the creation of market power. Therefore, in assessing a proposed merger, the Competition and Consumer Authority first determines whether the merger would be likely to prevent or substantially lessen competition, or would be likely to result in any enterprise, including an enterprise which is not involved as a party in the proposed merger, acquiring a dominant position in a market. Furthermore, the Authority considers any factor which bears upon the broader public interest in a proposed merger.

The key steps involved in the mergers and acquisitions control process are as follows:

Step 1:- Notification of mergers and acquisitions is as per section 47 of the Act, with respect to the thresholds applicable for merger control. Pursuant to regulation 18(2), the merger notice shall be accompanied by a merger fee of 0.01 percent of the merging enterprises’ combined turnover or assets in Botswana, whichever is higher.

Step 2:- Assessment of mergers and acquisitions in line with section 52(1) provides the basis upon which the Competition Authority will assess the notified mergers and acquisitions. Once a merger is notified, the Authority investigates the proposed transaction through engaging key stakeholders, such as; the parties to the transaction, customers, competitors, consumer association, industry representative body, interested third parties, amongst others.

Step 3:- Determination of mergers and acquisitions provides the manner in which the Authority may make a determination in relation to a notified merger and acquisition.