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Welcome to the latest edition of Law Update titled “Rise of Generative AI.”
In this edition, we dive into the dynamic world of Technology, Media, and Telecommunications (TMT) across the Middle East and North Africa (MENA) region. TMT continues to play a vital role in positioning the region as an international business and social hub, driving significant growth and innovation.
Our focus in this Law Update is on the sector’s ongoing potential to advance and propel the region toward a more digital economy. We explore the benefits of embracing a digital transformation and how local authorities have responded by enhancing regulations to accommodate the evolving TMT landscape.
This edition covers a range of topics, including – the new Telecommunications & Information Technology Law in Saudi Arabia, the intricacies of trademarks in the Metaverse, and the legal challenges faced by the video game industry. Additionally, we take a regional perspective, discussing jurisdictions such as Kuwait, Saudi Arabia, UAE, Oman, and Bahrain to provide a comprehensive understanding of the TMT landscape.
We hope you thoroughly enjoy this packed issue of Law Update, filled with captivating articles that address key legal issues within a vital sector for the region.Read the full edition
On 29 December 2022, amendments to the Law on the Protection of Competition and Prohibition of Monopolistic Practices No. 3 of 2005 (the Egyptian Competition Law “ECL”) were published in the Egyptian Official Gazette. The amendments have entered into force as of the following day (i.e., Friday, 30 December 2022). Accordingly, M&A transactions that entail change in control or material influence that meet the thresholds stated in the Law require the approval of the Egyptian Competition Authority (“ECA”) before closing the transaction.
The amendments define the economic concentration as any change in control or material influence through a merger, an acquisition or a joint venture. The thresholds set in the law are as follows:
The amendments have made the transaction subject to two phases approval process:
It is worth mentioning that the new amendments do not apply to the banking sector and non-banking financial services. Any economic concentration in the banking sector shall be subject to the Central Bank of Egypt (“CBE”) approval only. According to Law No 194 for Year 2020, the banking sector includes the following activities:
As for the non- banking financial services, they shall be subject to the Egyptian Financial Regulatory Authority (“FRA”) approval after seeking ECA opinion on the matter. According to law No 10 for year 2009, the non-Banking financial activities include:
Under the new regime, the sanction for failure to submit the notification or executing the transaction after ECA rejection or failure to abide by ECA conditional approval is a fine ranging between a minimum of 1% and a maximum of 10% of the combined annual turnover or the combined assets or the transaction subject matter of the violation. In case the annual turnover cannot be calculated the fine is a minimum of EGP 30 million and a maximum of EGP 500 million.
The amendments also give ECA the right to take corrective measures in case of failure of submitting the notification or non-abiding by ECA decision and the agreement may be considered null and void.
The obligation of notification to ECA does not affect any other obligation of notification stated in other laws or international agreements.
Having immediate effect means that any ongoing transaction not closed before the publication of the law would be subject to the new regime of pre-merger approval. The Executive Regulations and the Guidelines on the implementation of the new amendments are yet to be issued by the ECA.
Our qualified members of the team are happy to provide legal assistance explaining the new amendments and submitting the filing notifications to ECA.
Partner, Head of Dispute Resolution - Egyptk.email@example.com
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