ADVOCATES TRAINING PROGRAMME

THE KENYA SCHOOL OF LAW

2025/2026 ACADEMIC YEAR

ATP 100: COMMERCIAL TRANSACTIONS PROJECT WORK

COURSE INSRUCTOR: MR. FRED WAKIMANI

SUBMISSION DATE: JULY,2025

MEMBER ADMISSION NUMBER SIGNATURE

Maryafline Juma 20250211

Mirriam Kemei 20250566

Cynthia Kivindyo 20250739

Janine Chelangat 20251650

Mutune Kioko 20251065

Casmiel Owino 20251221

Elijah Light 20251339

Paul Kariuki Muriu 20250628

Mcrae Macharia 20250520

Jedidiah Oguye 20250916

DECLARATION

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We, the members of firm 11, class A, 2025-2026, do hereby declare that this is our original work
and a collective effort by each member and has not been presented to any academic institution or
used for any other purpose other than The Kenya School of Law for academic credit.

………………………………………
JANINE CHELAGAT
(UNIT REPRESENTATIVE)

…………………………………….
MARYAFLINE JUMA
(FIRM LEADER)

ACKNOWLEDGEMENT

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First and foremost, we give thanks to the Lord Almighty for His grace, guidance, and protection
throughout the course of this project. It is by His strength that we were able to work diligently,
stay united, and complete this task successfully. We also extend our heartfelt appreciation to all
members of Firm 11, Class A for their dedication, teamwork, and collaborative spirit. Each
member played an essential role, and it is through this collective effort that the process was both
smooth and fulfilling. Our sincere gratitude goes to Mr. Fred Wakimani for his clear, insightful,
and well-structured teaching, which provided the foundation and understanding we needed to
approach this task effectively. We further thank the Kenya School of Law for affording us this
opportunity and for the support and resources availed to us throughout the assignment.

4Page
LIST OF STATUTES

Competition Act (Kenya), No. 12 of 2010

COMESA Competition Regulations, 2004

COMESA Competition Rules, 2004

Enterprise Act 2002 (UK)

Enterprise and Regulatory Reform Act 2013 (UK)

Digital Markets, Competition and Consumers Act 2024 (UK)

National Security and Investment Act 2021 (UK)

The COMESA Treaty, 1994

Merger Assessment Guidelines (COMESA), 2014

Rules on the Determination of Merger Notification Thresholds and Method of Calculation

(COMESA)

CAK Merger Threshold Guidelines (Kenya)

Practice Notes and Notices (COMESA Commission)

5Page
LIST OF CASES

Nava Apparels L.L.C-FZ & Mombasa Apparels (Kenya)

Commercial Bank of Africa Ltd & NIC Group PLC (Kenya)

CBA & NIC Merger (Kenya)

Facebook (Meta) Inc. & Giphy Inc. (UK)

3G Truck & Trade Trailer Parts Ltd & TVS Europe Distributors Ltd (UK)

BT Group Plc & Everything Everywhere Ltd (UK)

Sainsbury's & Asda (UK)

Coca-Cola SABCO & Almasi Beverages Ltd (COMESA)

Nutreco International B.V. & Unga Farm Care E.A. Ltd (Kenya/COMESA)

Access Bank & National Bank of Kenya (COMESA)

Vodafone & Three UK

KenolKobil Plc & Gulf Energy Holdings Ltd (Kenya)

Cérélia & Jus-Rol (UK)

Akzo Nobel N.V. & Kansai Plascon East Africa & Kansai Plascon Africa Ltd (COMESA)

Nakumatt & Tuskys (Kenya)

Makini School Ltd acquisition by Scholé Ltd & Advtech (Kenya)

Helios Towers Ltd & Madagascar Towers S.A. & Malawi Towers Ltd (COMESA)

Just Eat & Hungryhouse (UK)

Sika International AG (CAK/COMESA notification conflict)

National Bank of Kenya/KCB Group merger (Kenya)

Plc & Gulf Energy Holdings Limited

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LIST OF ABBREVIATIONS
CAK-Competition Authority of Kenya

CCC-COMESA Competition Commission

COMESA-Common Market for Eastern and Southern Africa

CMA -Competition and Markets Authority (UK)

SLC -Substantial Lessening of Competition

UK-United Kingdom

SMEs Small and Medium Enterprises

NIC- NIC Group PLC

CCR- COMESA Competition Regulations

CD-ROM Compact Disc Read-Only Memory

EU-European Union

IRA- Insurance Regulatory Authority

EPRA-Energy and Petroleum Regulatory Authority

KEBS -Kenya Bureau of Standards

MoU -Memorandum of Understanding

AI Artificial Intelligence

CJEU-Court of Justice of the European Union

CBA-Commercial Bank of Africa

NBK-National Bank of Kenya

CCBA – Coca-Cola Beverages Africa

SABCO – South African Bottling Company

USD – United States Dollar

7Page
Table of Contents
DECLARATION.........................................................................................................................3
ACKNOWLEDGEMENT...........................................................................................................4
LIST OF STATUTES..................................................................................................................5
LIST OF CASES..........................................................................................................................6
LIST OF ABBREVIATIONS......................................................................................................7
INTRODUCTION.....................................................................................................................10
MERGER NOTIFICATION THRESHOLD AND PROCESSES UNDER THE
COMPETITION AUTHORITY OF KENYA (CAK)...............................................................10
1.1 Merger Notification threshold..............................................................................................11
1.2 Merger Review process........................................................................................................12
MERGER NOTIFICATION THRESHOLD AND PROCESSES UNDER THE CCC............15
Legislation.......................................................................................................................................16
2.2 Notification Threshold.............................................................................................................17
2.3 Process of Notification.............................................................................................................18
UNITED KINGDOM MERGER THRESHOLDS AND PROCESS........................................20
Legal and institutional framework................................................................................................20
Notification threshold.....................................................................................................................20
Process of notification of mergers to CMA.................................................................................21
COMPARISON OF MERGER NOTIFICATION THRESHOLDS, PROCESSES AND
CROSS-BORDER MERGERS UNDER THE CAK, COMESA AND THE UK.....................24
Difference In Legal In Terms of The Framework or Regulators...............................................24
Notification Thresholds..................................................................................................................25
Time-Frame.....................................................................................................................................26
Institutional Comparison In The Context of BREXIT...............................................................27
Consequences of Failure to Notify................................................................................................27
The Evaluation Criteria of Mergers and Factors Considered....................................................28
Possible Outcomes of the Mergers Notification Process............................................................31
RECOMMENDATIONS...........................................................................................................31
1. Incentives & Tariffs Reduction.............................................................................................32
2. Harmonization of substantive Law and Procedural laws....................................................32
3. Implementation of measures to curb currency risks............................................................34

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 4. Modernization of financial systems and Training of Staff.................................................35
5. Issues and suggested reforms regarding public interest concerns.....................................35
6. Integration of modern technology like Generative AI........................................................37
CONCLUSION..........................................................................................................................38

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Question 9
Critically analyze the merger notification thresholds and processes under the Competition
Authority of Kenya (CAK) and COMESA compared to the UK. What are the implications for
cross-border mergers, and how can Kenya improve its regulatory framework?

INTRODUCTION
Mergers are fundamental drivers of corporate growth, market expansion. Under section 41 of the
Competition Act1 a merger occurs when one or more undertaking directly or indirectly acquires
control over the whole or part of a business of an undertaking. The control can be achieved in
many ways such as purchase or lease of shares, acquisition of an undertaking under receivership,
vertical integration, and amalgamation.

However, mergers are subject to national and regional competition authorities, each operating
under distinct legal frameworks. This research critically analyzes the merger notification
thresholds and review processes established by the Competition Authority of Kenya (CAK) and
the Common Market for Eastern and Southern Africa (COMESA) Competition Commission
(CCC), comparing them with regime of the United Kingdom's Competition and Markets
Authority (CMA).

By examining these divergent approaches, this study aims on understanding the implications for
businesses engaged in cross-border mergers, particularly those in Kenya and the wider
COMESA region. Additionally, the study will propose recommendations for Kenya to enhance
its regulatory framework fostering greater efficiency.

MERGER NOTIFICATION THRESHOLD AND PROCESSES UNDER THE COMPETITION

AUTHORITY OF KENYA (CAK)
The regulatory framework for mergers in Kenya is governed by the Competition Act of Kenya
2010.

1
CAP 504, Laws of Kenya.

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In Kenya, mergers must be notified to regulatory bodies like CAK. However, there are mergers
that are excluded requiring CAK’S approval that is mergers that can apply for exemption of
notification this are mergers where the value of the merging parties is between Kshs.500 million
and Kshs.1 billion or where the undertakings are engaged in prospect in the carbon-based
mineral sector.

Secondly mergers that are excluded without CAK’s approval that is they are exempt from
notification to the CAK this where the combined turnover or assets of the merging undertaking
do not exceed Kshs.500 million or if the undertakings meet the COMESA Competition
commission Merger notification threshold and at least 2/3 of turnover or assets (whichever is
higher) is not generated or located in Kenya.

1.1 Merger Notification threshold.

Assets and annual turn overs guide the Authority in the merger’s threshold. Under the Merger
Threshold guidelines2. Merger requires notification if:

a) Combined turnover value of the two entities.

Where the undertakings have a combined turnover or assets of One billion shillings
(Ksh.1,000,000,000) and that of the target undertaking is above Five hundred million shilling
(Kshs.500,000,000)

b) Asset value of the acquiring entity.

Where the turnover or assets of the acquiring undertaking is above Ten billion shillings
(Kshs.10,000,000,000) and the merging parties are in the same market, vertically integrated,
unless the transaction meets the COMESA competition commission merger notification.

c) Carbon-based mineral sector

In the Carbon-based mineral sector if the value of reserves, rights and assets resulting from the
merger exceed ten billion shillings (Kshs.10,000,000,000)

d) Undertaking Operating in COMESA

Where undertaking operate in COMESA and the value of the merger does not exceed Kshs. Five
hundred million (Kshs.500,000,000) and 2/3 of its generated or located in Kenya.

2
The Competition Act (General) rules, 2019 Legal notice No. 176

11 P a g e
Merger filing fee
For the above mergers the merging parties pay merging filing fees: whereby Kshs.500 million to
Ksh.1 billion no filing fee; Over Kshs.1billion to 10 billion the filing fees is Kshs.1 million; Over
10 billion to 50 billion the filing fees is Kshs.2 million; Over 50 billion the filing fees is 4 million

1.2 Merger Review process.

a). Merger submission

Each undertaking shall notify the CAK of the proposal once a decision to merge has been made.
The proposal is to be made in writing. The authority will then acknowledge a receipt of merger
application within 3 days.3

The authority upon receiving the proposal shall review and shall within 30 days request for any
other information necessary from one of the parties involved in the merging 4. In an event where
the application is incomplete, it can request for additional information from the merging parties.

c). Hearing conference.

Where the authority requires to convene a hearing conference, it shall make a determination
within 30 days after the date of the conclusion of the conference.5

The authority has 60 days to determine the proposed merger the authority might seek for an
extension of time which shall not exceed 60 days.6

d). Assessment of mergers.

In assessing proposed mergers, the authority will also determine if the merger is a relevant
merger under Sec 2 and Sec 41 of the Competition Act; Sec 2 of the Act defines a merger while
section 41 highlights ways a merger may be achieved Determine if it meets the threshold for
mandatory notification as provided for.

3
Sec 43(1) of the Competition Act, CAP 504, Laws of Kenya
4
Sec 43(2) of the Competition Act, CAP 504, Laws of Kenya
5
Sec 45 of the Competition Act, CAP 504, Laws of Kenya
6
Sec 44(1) of the Competition Act, CAP 504, Laws of Kenya.

12 P a g e
The CAK under Sec 46(2) takes into account various factors which are categorized into two the
Competition assessment and the public interest assessment.7

a) Competition test.

The authority assesses whether or not the proposed merger is likely to lessen or prevent
competition or create a strong dominant position. The authority will look if there are other
players in the market and the competition levels without the proposed merger. Then consider the
strength and the impact of the proposed merger on the said market.

They asses to ensure that there is effective competition in the market and that the consumers will
have a choice of suppliers and switching options which would prompt business to effectively
compete for consumers.

In order to assess the impact, the merging proposal will have on the competition, the Authority
will look at the relevant product market as well as relevant geographic market. The relevant
product market comprises products that are interchangeable by the consumer due to their
characteristics, prices or uses. The relevant geographic market involves the area in which the
merging parties undertake the business and in which the competition conditions are similar. 8

A notable example is in when the Competition Authority of Kenya evaluated the proposed
acquisition of Mombasa Apparels by Nava Apparels. Nava apparels L.L.C-FZ was a limited
liability company involved in the manufacturing of clothing apparel for export to the US, Canada
and Europe While Mombasa Apparels was a limited liability company in Kenya whose market is
the United Arab Emirates and the US. The proposed transaction involved acquisition of assets of
Mombasa by Nava Apparels L.L.C-FZ. This transaction qualified as a merger under sec 2 and 41
of the Competition Act. The Authority in approving the merger process stated that the
transaction is unlikely to negatively impact competition in the market. The authority assessed the
market share of the merged entity, which would rise to 3.83%. It concluded that, despite this
increase, the merger would still face significant competition from other players who control

7
Pg 13, Consolidated Guidelines on the substantive Assessment of Mergers Under the Competition
Act,https://.cak.go.ke
8
Cak Decision on The Proposed Acquisition Of 66.67% Shareholding of AIG Kenya Insurance Company Limited by
NCBA Group Plc,2024.

13 P a g e
96.17% of the market. Based on this analysis, the Authority determined that the proposed
transaction was unlikely to substantially reduce competition in the export clothing apparel
market.

Under the Competition assessment the authority will consider if by merging the restructuring of
the market might inadvertently enable the undertaking to acquire or strengthen its dominance in
the market. The authority is concerned is that is the dominant position acquired would lead to an
abuse such as exploitation of prices.

b) Public interest.

Under the Competition Act some of the various public considerations are; Extent to which the
proposed merger will affect employment, the public, will affect a particular industrial sector or
region, will affect small business to compete in the market.

CAK required the merging entities to enumerate any job losses that may be occasioned by the
merging process. Consequently, the merging parties are required to substantiate any claims of
employment that may be generated as a result of the matter.

In, 2019 The Competition Authority of Kenya approved the proposed merger between
commercial Bank of Africa Limited and NIC Group PLC on condition that none of the
employees of the merged entity are declared redundant within 12 months of closing the
transaction in Kenya.9 The proposed transaction was is the acquisition of shares capital in CBA
in exchange for shares in NIC. It was proposed that the shareholders of CBA get shares in NIC
and ultimately the two banks will merge. The transaction qualified as a merger under sec 2 and
41 of the Competition Act No. 12 of 2010. In assessing the proposed merger, the authority held
that the merging of the two is likely to lessen competition in the market. However, it would lead
to negative public interest however the merging parties stated that no branch closure is
anticipated excepts in locations where there are overlaps and in the existence of the overlap the
merging parties indicated they were opening new branches to accommodate the staffs.

9
Proposed merger between Commercial Bank of Africa Limited and NIC Group PLC
https://www.cak.go.ke/sites/default/files/determinations/2024-07/CAK_Decision_on_Proposed_Merger_between
_Commercial_Bank_of_Africa_Limited_and_NIC_Group_Plc%20%281%29.pdf

14 P a g e
The authority considers if the proposed merger will affect ability of national industries to
compete in the international levels.

The authority will also consider if the merging process will lead to collapse of key local
industries or if the merging process will prejudice the SMEs by crowding or closing
opportunities for them.

e). Decision

After the above considerations the Authority can approve, conditionally approve, or prohibit a
merger. Conditional approvals come with specific requirements that must be met by the merging
entities. In some cases, the CAK may convene a hearing conference to gather more information
and views on the proposed merger. This conference provides a platform for stakeholders to
present their opinions and for the Authority to make a more informed decision10.

MERGER NOTIFICATION THRESHOLD AND PROCESSES UNDER THE CCC

The main objective of the Common Market for Eastern and Southern Africa (COMESA), which
comprises 21 member states, is to foster regional integration by creating a larger, unified market.
COMESA promotes regional integration by harmonizing policies, trade practices and market
structures of its member states.11 To support this integration, Article 55 of the 1994 COMESA
Treaty recognized the necessity of adopting competition rules to regulate anti-competitive
behavior that could impede trade liberalization within the common market. 12 Since national
competition authorities have limited jurisdiction, in 2002, COMESA developed the COMESA
Competition Regulations as a regional competition framework to address anti-competitive
conduct with cross-border effects.13 The COMESA Competition Regulations were adopted in
2004 and came into effect on 1st January 2005. The CCR aims to promote fair competition, to
enhance regional trade and investment while maximizing consumer welfare across the COMESA
region.

10
Sec 45 of the Competition Act, CAP 504, Laws of Kenya.
11
Treaty Establishing the Common Market for Eastern and Southern Africa (signed 5 November 1993, entered into
force 8 December 1994https://www.comesa.int/wp-content/uploads/2019/02/comesa-treaty-revised-20092012_with-
zaire_final.pdf) accessed 1 June 2025
12
COMESA Treaty 1994, art 55
13
COMESA Competition Commission COMESA Competition Regulations, 2004

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 A regional competition authority was envisioned to streamline merger notifications, foster
cooperation among national competition agencies, avoid conflicting decisions, and create a
stable legal environment conducive to business and investment. The COMESA Competition
Commission (CCC) was established under Article 6 of the 2004 regulation to enforce CCR. In
2008.14 It however started its enforcement activities in January 2013.

The CCC is tasked with investigating mergers, restrictive trade practices, and consumer
protection matters that have a regional dimension that is, conduct affecting two or more Member
States. In contrast, domestic competition issues, fall within the jurisdiction of national
competition authorities, such as The Competition Authority of Kenya (CAK) 15, which deals with
matters competition in Kenya. The CCC also operates under a Board of Commissioners, which
functions as both an appellate and policy-setting body. Under COMESA law, all mergers that
have a cross-border impact on more than one Member State must be notified to the CCC for
review and approval.16

Legislation
In addition to the COMESA Competition Regulations 17 mergers are further guided by the
COMESA Competition Rules, 2004,18 the Merger Assessment Guidelines19 issued in 2014, and
the Rules on The Determination of Merger Notification Thresholds and Method of Calculation. 20
Supplementary Practice notes and Notices 21 issued by the commission also provide procedural
clarity on thresholds, fees and filing requirements. 22 The thresholds for mandatory notification
under the guidelines are the following

14
COMESA Competition Regulations, 2004, art 6
15
The Competition Authority of Kenya
16
COMESA Competition Regulations, 2004 (entered into force 1 January 2005)
https://www.comesacompetition.org/wp-content/uploads/2020/07/COMESA-Competition-Regulations.pdf accessed
1 June 2025.
17
COMESA Competition Commission COMESA Competition Regulations, 2004
18
COMESA Competition Rules, 2004
19
COMESA Competition Commission, Merger Assessment Guidelines (31 October 2014)
https://www.comesacompetition.org/wp-content/uploads/2014/10/141121_COMESA-Merger-Assessment-
Guideline-October-31st-2014.pdf accessed 1 June 2025
20
COMESA Rules on the Determination of Merger Notification Threshold and Method of Calculation
https://www.comesacompetition.org/wp-content/uploads/2015/04/Amendments-to-the-Rules-to-the-Determination-
of-Merger-Thresholds-and-Method-of-Calculation-adopted-by-COM-26-March-2015.pdf accessed 1 June 2025
21
COMESA Competition Commission, Guidelines and Practice Notes https://comesacompetition.org/guidelines-
and-practice-notes/ accessed 1 June 2025
22
https://www.werksmans.com/storage/2022/11/A-Jurisdictional-Guide-.pdf accessed 1 June 2025

16 P a g e
2.2 Notification Threshold
Rule 4 of the COMESA Rules on Determination of Merger Notification Thresholds and method
of Calculation provides a precise set of jurisdictional thresholds that must be satisfied
cumulatively.23

The Regional Dimension Test

The initial criterion for COMESA jurisdiction is the regional dimension test, which
fundamentally establishes the territorial scope of the transaction. This threshold mandates that
the merging parties must operate in at least two COMESA Member States. This stipulation
ensures that only mergers with a genuine cross-border implication fall within the ambit of the
Commission's oversight

Under the Practice Note to the COMESA Competition Rules the regional dimension can be
satisfied if;24

(a) Both the acquiring and target firms operate in at least two COMESA Member States. 25

(b) The acquiring firm operates in at least two Member States, while the target firm operates in at
least one COMESA Member State.26

(c) The target firm operates in at least two Member States, while the acquiring firm operates in at
least one COMESA Member State.27

a) The Combined Turnover or Asset Value Test

Other than geographical reach, CCC's analysis extends to the aggregate economic significance of
the transaction, as determined by the combined turnover or asset value test. This threshold
requires that the combined annual turnover or the combined annual asset value of all merging
parties within the COMESA Common Market must collectively amount to at least US$50
million.28

23
COMESA Rules on the Determination of Merger Notification Threshold, Rule 4
24
COMESA Competition Commission Revised Practice Note Regarding the Commission’s Interpretation of The
Term Operate(9th March 2023) https://www.comesacompetition.org/wp-content/uploads/2023/03/Revised-Practice-
Note-on-Rule-4-89663.pdf accessed 1 June 2025
25
Ibid
26
Ibid
27
Ibid
28
COMESA Threshold Rules (n5) r 4

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 a) The Individual Turnover or Asset Value Test

Complementing the combined economic significance, the individual turnover or asset value test
ensures that at least two of the merging parties possess a meaningful and discernible economic
presence within the COMESA market. This condition is met where each of at least two of the
parties involved in the merger have an annual turnover or asset value, whichever is higher, of at
least US$10 million within the Common Market.29

b) The Two-Thirds Exemption Rule

The final and critically important threshold is the two-thirds exemption rule, which acts as a
fundamental safeguard against the overreach of COMESA's regulatory authority. Even if a
merger satisfies the preceding three thresholds, it will be exempted from COMESA's jurisdiction
if each of the merging parties derives at least two-thirds of its turnover or holds two-thirds of its
assets within one and the same COMESA Member State.30

This exemption is pivotal in maintaining a judicious balance between COMESA's regional

integration objectives and the sovereign jurisdictional prerogatives of its Member States, thereby
fostering a collaborative and effective multi-tiered competition enforcement regime.31

2.3 Process of Notification

The Regulations call for the mandatory notification of mergers that satisfy the requirements of
Part 4 of the Regulations.32 Article 24(1) of the COMESA competition Regulations states that
notification of a merger should be done as soon as is practicable. 33 However, the said
notification should not be done later than 30 days of the decision to merge.

Merger Submission

To file a merger, the parties must fill out Form 12 from the CCC and pay the required fee. The
filing is only considered complete if all information is given and the fee is paid. If any

29
COMESA Threshold Rules (n5) r 5
30
COMESA Threshold Rules (n5) r 6
31
Revised Practice Note (n10) 4
32
COMESA Competition Regulations(n4)
33
COMESA Competition Regulations 2004, art 24(1)

18 P a g e
information is missing or the fee is not paid, the filing is incomplete. The form can be found and
downloaded from the Commission's website.34

a) Notification

You can notify the Commission through email, CD-ROM or sending one original hard copy file.
If you notify by email and pay the fee, the later date (either when the email is received or when
the fee is paid) is taken as the official date of notification. If you use email or CD-ROM, you
must send the original hard copy to the Commission within 7 days.35

b) Cost of Filing a Merger

The filing fee is 0.1% of the combined annual turnover or asset value of both merging companies
in the COMESA region. You use the higher of the two. The maximum fee you can be charged is
US$200,000.36

c) Assessment criteria by the CCC

Once the notification is received, the Commission will start examining the merger.

i. Competition

When reviewing mergers, the COMESA Competition Commission focuses first on whether the
merger will harm competition in the market. If it finds that competition will be significantly
reduced, it looks at whether the merger will bring efficiencies or benefits that outweigh that
harm. The Commission considers various market factors, such as barriers to entry, market
concentration, and potential for dominance.37

ii. Public Interest

Besides competition, the Commission also examines public interest issues. This means looking at
how the merger will affect consumers, prices, quality, and innovation. Importantly, the
Commission assesses the impact on employees, including whether jobs will be protected or lost,

34
COMESA Competition Commission, Form 12: Notice of Merger
https://comesacompetition.org/wp-content/uploads/2023/03/Form-12-Notice-of-Merger-2.pdf accessed 1 June 2025
35
https://www.comesacompetition.org/mergers-and-acquisitions/how-to-file-a-merger/ accessed 1 June 2025
36
COMESA Competition Commission, Form 12: Notice of Merger (n 23)
37
COMESA Competition Regulations 2004, art 26

19 P a g e
and how working conditions might change. Employee protection is a critical part of the overall
public interest evaluation.38

If the merger is found to be harmful to competition, public interest, or employee welfare, it may
be blocked or approved with conditions. Appeals can be made to the Board of Commissioners.39

The Commission must make a decision within 120 days of getting the complete notification. If
they don’t make a decision in that time, the merger is automatically approved. After reviewing
the merger, the Commission can approve it with no conditions, approve it with certain conditions
or reject it completely.40

UNITED KINGDOM MERGER THRESHOLDS AND PROCESS

Legal and institutional framework.

The United Kingdom (UK) merger control is governed by the Enterprise Act of 2002 41. The
Competition and Markets Authority (CMA) enforces the Enterprise Act. 42 The Act provides the
parameters and procedures to be followed in cases of a relevant merger situation that may result
to a Substantial Lessening of Competition (SLC).

Notification threshold
Section 23 of the Act defines the three threshold notification criteria.43

1.1 One or more enterprises ceasing to exist

A relevant merger situation is created when either two or more enterprises ceases to exist or there
must be arrangements in progress or being contemplated, which if successful will lead to the
enterprises ceasing to exist.44

2.2 Turnover, Share Supply and Hybrid tests

38
ibid
39
ibid
40
ibid
41
Enterprise Act 2002, in https://www.legislation.gov.uk/ukpga/2002/40/contents.
42
Competition and Markets Authority, in https://www.gov.uk/government/organisations/competition-and-markets-
authority
43
Section 23 of the Enterprise Act
44
Section 23(1)(a) of the Enterprise Act

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The turn-over test is satisfied where the UK turnover associated with the enterprise which is
being acquired exceeds £100 Million. 45 The share supply test requires that at least one of the
enterprises that ceases to be distinct has a UK turnover that is above £10 Million. In addition,
that the ceasing enterprise supplies or acquires goods or services of any description. So also, that
after the merger, the same persons or entity supplies or acquires at least 25% of particular goods
or services of the same kind as are supplied in the UK or in a substantial part of the UK. 46
Additionally, the merger must result in an overall increment to the share supply or acquisition.

Under the Hybrid test, the person or persons that carry on an enterprise concerned must supply or
acquire at least 33% of goods or services of any description in the UK, the same enterprise
concerned has a UK turnover exceeding £350 Million, and any other enterprise concerned has a
nexus with the UK.47

2.3 The Merger has not taken place

The third criterium is that either the merger must not yet have taken place or the date of the
merger must be no more than four months before the day the reference is made unless the merger
took place without having been made public and without informing the CMA.

Process of notification of mergers to CMA

Under the CMA Act, the decision on whether to notify or not is voluntary. Even if a particular
enterprise constitutes a relevant merger situation but does not raise competition concerns, the
parties are free to decide whether or not to notify CMA.

In cases that concern the possibility of competition, the parties should consider notifying the
competition authority. The CMA has its own intelligence through which it finds out which
enterprise ought to have notified and it did not. In instances where such an entity has gone
through the whole process of merger, there is a risk that the authority might order a disposal of
the enterprise.48 Furthermore, individuals can report such mergers to the CMA.

45
Section 23(1)(b) of the Enterprise Act
46
Section 23(4)(a) of the Enterprise Act
47
Section 23(4)(d) of the Enterprise Act
48
For example, in the case of the completed acquisition by Facebook, Inc (Now Meta Platforms, Inc) of Giphy, Inc
(18th October 2022) was found to raise competition concerns and was required to sell out the target company.
<https://assets.publishing.service.gov.uk/media/61a4bfa2e90e07044a559d57/Facebook_GIPHY_-
_Summary_of_Final_Report.pdf> accessed on 5th June 2025

21 P a g e
Under the CMA, the notification procedure begins with a preliminary examination followed by
phase one and finally phase two.

1.2 Preliminary examination: voluntary and involuntary

3.1.1 Voluntary notification

In a voluntary notification, pre-notification discussions are held. Within a minimum of two

weeks before the notification, the CMA assigns a team to liaise with the parties concerning the
threshold issues and the nature and scope of the information that will be required. Then the
parties voluntarily notify the CMA as required by filling a prescribed Merger notice form, which
is available on the CMA website.49

3.1.2 Involuntary notification

Where parties had chosen not to inform, and the authority is convinced that the merger falls
within the threshold, it conducts an investigation on its own initiative from publicly available
sources. The authority sends an inquiry letter to the parties, and the parties must respond to it.
Once it has received sufficient information, the CMA responds by giving the parties the statutory
deadline for conducting phase one investigations.50

1.3 Phase one examination

It is run within 40 working days. During day 1- 15, the CMA confirms that it has received a
complete merger notification, or that it has conducted its preliminary investigations on its own
initiative. The CMA then gathers substantive information from the parties and from interested
third parties. During days 15-20, the CMA holds the “state of play” discussions. During days 20-
35, the CMA may hold an issues’ meeting where there is a complex or material competition
issue.51 It then sends an issues letter way in advance. 52 By the 40th day, the CMA issues its
decision, which is either; an unconditional clearance; a clearance subject to legally binding
undertakings; or a reference to phase 2 investigation.53

49
Competition and Markets Authority official website <www.gov.uk/cma> accessed on 5th June 2025.
50
Timothy Mclver and Anne Mette Heemsoth Debevoise &Plimpton LLP, Merger Control in the UK (England &
Wales): Overview, Practical Law Global Gide, 2017, Competition, p. 3.
51
Ibid
52
Ibid
53
Section 24 of the Enterprise Act

22 P a g e
The CMA refers the results of phase one to the second phase of investigation if the merger will
result to an SLC or is more likely than not to lessen competition, and when it believes that there
is a realistic prospect that the merger will result in a SLC. If the merger is not sufficiently
advanced, or the market involved is of little importance, or the benefits outdo the adverse effects,
or when it is wiser to accept an undertaking rather than move on to phase two, CMA does not
have to refer the matter to phase two.54

2. Phase two: Full investigations by CMA.

The CMA is under a statutory obligation to complete the investigations within 24 weeks and
publish a report. If need be, the period can be extended for not more than 8 weeks.55

2.1 The nature of the investigations.

The investigation comprises of written submissions from the parties to the merger and interested
third parties and oral hearings of the parties to the transaction and the very significant third
parties.
2.2 Possible decisions
The CMA must then decide on whether there is a relevant merger situation, and if so, whether it
may lead to a SLC. The decision takes the form of an unconditional clearance, clearance subject
to legally binding undertakings, a prohibition. One of such judgment on the effect of the merger
on competition was the BT and EE acquisition.

4.3 The BT and EE acquisition

There was an anticipated acquisition by British Telecom Group plc of Everything Everywhere
Limited. Concerns were raised by other operators and customers in the UK telecoms industry
especially in relation to access to the Openreach network. BT was given an unconditional
clearance. CMA concluded that BT and EE operate largely in separate areas, with only limited
overlap, and consequently the merger would not substantially lessen competition in any market
or markets in the UK.56

54
Section 33 of the Enterprise Act
55
Section 51 of the Enterprise Act
56
Anticipated acquisition by BT Group plc of EE Limited (ME/6519-15), 9th June 2015, in
https://assets.publishing.service.gov.uk/media/558a835ded915d1592000001/BT-EE_full_text_decision.pdf

23 P a g e
COMPARISON OF MERGER NOTIFICATION THRESHOLDS, PROCESSES AND CROSS-
BORDER MERGERS UNDER THE CAK, COMESA AND THE UK

Merger notification processes and thresholds in Kenya, the countries in the COMESA region as
well as the United Kingdom are different in terms of regulations, time frame, the procedures to
be undertaken as well as the consequences of non-notification among others. This part of the
research is going to clearly outline and discuss the various differences in relation to the
thresholds of merger notification and the processes in Kenya, the COMESA region and the UK.

Difference In Legal In Terms of The Framework or Regulators

In Kenya Mergers are regulated by the Competition Authority of Kenya (CAK) established
under the Competition Act 2010. The mandate of CAK is to promoted and safeguard
competition. Under Section 42 of the Competition Act, the Authority regulates mergers in the
sense that, it mandates all merging entities to seek approval of the CAK prior to the
implementation of a merger. 57

In the COMESA region on the other hand, mergers are regulated by the COMESA Competition
Commission established under Article 6 of the COMESA Competition Regulations with the aim
of investigating and approving mergers within the COMESA region. 58

In the United UK, mergers are regulated by the Enterprise Act 2002 which gives the parameters
and procedures to be followed in cases dealing with mergers.

The impact of this is that entities involved in cross-border mergers that affect more than one
jurisdiction may find themselves needing to notify multiple regulators. For instance, if a Kenyan
company merges with another company based in a different COMESA member state, it might be
required to notify both CAK and CCC. This dual notification process can increase administrative
workload and costs. Meanwhile, the UK's voluntary system might seem easier at first, but there's
a catch, the CMA can still step in after the merger if it believes the deal negatively affects
competition.59 The voluntary nature of UK merger control may create asymmetric regulatory

57
Competition Act 2010, Sec 42.
58
COMESA Competition Regulations , Article 6
59
David Reader, UK Merger Control: Finely tailored but time for a new suit? in Barry Rodger, Peter Whelan and
Angus MacCulloch (eds), The UK Competition Regime, a twenty-year Retrospective (OUP 2021), p. 18.

24 P a g e
burdens where Kenyan parties face mandatory delay requirements while UK counterparts can
proceed immediately. This unpredictability can make planning harder for international
businesses.

Notification Thresholds

Merger notification thresholds are different under the CAK, the CCC and even the UK and this
have some implications for cross-border mergers.60The differences in terms of the notification
thresholds are as follows;

i) The combined turnover or asset value

For a merger to be notifiable to the CCC, this threshold requires that the combined annual
turnover or the combined annual asset value of all merging parties within the COMESA
Common Market must collectively amount to at least US$50 million. 61 While under the CAK the
combined asset turnover is 1(one) billion Kenya Shillings.

ii) Individual turnover or asset value

For a merger to be notifiable to the CCC, the asset value or the annual turnover of each
undertaking involved in the merger whichever is higher, should be of at least US$10 million
within the Common Market.

For a merger to be notifiable to the CAK the asset value of the target undertaking should be 500
million shillings while the asset value of the acquiring the undertaking should be above 10
billion shillings.

In the UK the threshold required for notification is that; the value of the enterprise which is being
acquired should exceed £100 Million.

iii) Undertakings dealing in carbon based mineral sector

Under the CAK it is mandatory for undertakings dealing in carbon based mineral sector to notify
the authority irrespective of the value of the asset which is not the position in UK and COMESA.
60
Ibid
61
COMESA Threshold Rules (n5) r 4

25 P a g e
Multinational entities must track and compare different financial thresholds set by regulators. A
transaction that falls below the threshold in Kenya might still need notification in COMESA due
to its higher combined turnover requirement. Moreover, companies operating in Africa often deal
in local currencies, such as the Kenyan Shilling. Currency exchange rate fluctuations can shift
the value of a deal pushing it above or below a threshold. For example, a deal priced at USD 49
million may avoid COMESA notification today, but tomorrow, due to currency weakening, it
might cross the USD 50 million mark and require full notification and filing fees. This creates
uncertainty and requires proactive financial planning.

Time-Frame

The merger notifications and the completion period under the CAK, the CCC and the CMA of
the UK differ in terms of duration needed for the notification and the time taken for review so
that the merger can be completed.

Under the CAK, the Authority takes at least 60 days to finish reviewing the merger once all the
relevant documents have been submitted. Under the CCC on the other hand, parties ought to
notify the Commission of the decision to merge, the Commission then takes at least 120 days to
review the merger after all the relevant documents have been filled.

In the UK, the duration taken by CMA to review and ensure the merger has come to a conclusion
is about six to 8months due to the intense procedures and the two phases involved.

Timelines in mergers and acquisition are significant as market dynamics are spontaneous and can
shift anytime. Each authority takes a different amount of time to review and approve a merger.
For entities working across these regions, such misaligned review periods can cause delays in
implementing mergers. This is especially problematic when business plans rely on prompt
approvals. For example, if CAK clears a merger within two months but CCC takes four months,
the company must wait for CCC before integrating operations, hiring new staff, or launching
joint products. This waiting period adds costs and uncertainty, and may even discourage mergers
altogether, particularly in fast-moving industries.

26 P a g e
Institutional Comparison In The Context of BREXIT

The COMESA and Kenya regimes offer more layers of regional obligations with regards to the
regulation of mergers even though EAC has not fully operationalized its competition regulator,
the EAC Competition Authority.62 On the other hand, in the UK, UK-only mergers have a one-
stop shop clearance since the UK exited the European Union. However, those that have both a
UK and EU dimension do not benefit from the “one-stop shop” anti-trust clearance regime
established by Brexit. 63

As a result, many transactions now require clearance from both the European Commission and
the UK’s Competition and Markets Authority (CMA) (as well as any relevant competition
authorities in other jurisdictions, such as the US and China). 64Accordingly, the institutional layer
behind UK mergers at times offer an inconsistent notification framework and thereafter
obligations arising from the same. This will be contextualized further below when the
implications are laid out.

Consequences of Failure to Notify

As aforementioned, in Kenya, it is an offence to implement a merger without CAK approval

which is punishable by up to 5 years’ imprisonment, a fine up to KES 10 million, or both. 65
Additionally, the CAK may impose a financial penalty up to 10% of the preceding year's gross
annual turnover of the undertakings involved.66 With regards to COMESA the failure to notify a
notifiable merger renders the merger legally unenforceable. The CCC may impose financial

62
Kevin Mathenge ‘ Overview of merger control in Kenya’< https://mathenge.africa/overview-of-merger-control-
in-kenya/ > accessed 1st of June of 2025.
63
, https://www.macfarlanes.com/what-we-think/2022/the-impact-of-brexit-on-uk-m-a/ < accessed 1st of June
2025.
64
ibid
65
Section 42(5) of the Competition Act 2019.
66
Section 42(6) of the Competition Act 2019.

27 P a g e
penalties of up to 10% of either or both of the merging parties’ annual turnover in the Common
Market.67

In 2021, the COMESA Competition Commission (CCC) issued its first fine for failure to notify a
transaction to the CCC within the timelines of Article 24(1) of the COMESA Competition
Regulations of 2004. The fine was issued to Helios Towers Ltd and Madagascar Towers S.A and
Malawi Towers Ltd who failed to notify the commission of Helios’ acquisition of shares in the
two parties. The Committee Responsible for Initial Determinations (CID) imposed a fine of
0.05% of the Parties' combined turnover in the Common Market in the 2020 financial year.68

Comparatively, in the United Kingdom the failure to notify a notifiable merger is also an offence
similar to the CAK and COMESA. Penalties include imprisonment for up to 2 years, a fine of up
to 5% of the total value of the turnover, or both. 69 It's worth noting that the UK law does allow
for a "reasonable excuse" defense for failing to comply with notification requirements on a case
by case basis. 70

Not notifying a merger that should have been reported can be extremely costly. The fines
imposed by CAK or CCC are calculated based on company turnover, meaning the penalty grows
with business size. Moreover, reputational damage and potential court proceedings can disrupt
normal operations. Non-compliance with either regime may result in substantial penalties,
including fines and potential nullification of the transaction. For example, in the 2023 Sika
International AG merger case, even though the CCC approved the merger, CAK fined the
company Ksh 17.5 million for not filing separately in Kenya. CAK’s position is that because
two-thirds of the merged company’s turnover or assets are in Kenya therefore a separate filing is
required. This requirement increases the cost and complexity of cross-border mergers.71

67
COMESA COMPTITION COMMISSION FAQ 16 ON THE CONSEQUENCES OF BREACHING THE CONDITIONS OF
APPROVAL OF THE MERGER < https://www.comesacompetition.org/mergers-and-acquisitions/faq/ > accessed 1st
June 2025.
68
Burton Phillips and others, ‘COMESA Competition Commission issues first ever merger related fine - the time for
soft enforcement is over’< https://www.webberwentzel.com/News/Pages/comesa-competition-commission-
issues-first-ever-merger-related-fine.aspx. >accessed 2nd July 2025.
69
Section 174 of the Enterprise Act 2002.
70
See CMA,’ Administrative Penalties: Statement of Policy on the CMA’S approach, Consultation document’ July
2013.
71
CAK DECISION ON THE MATTER REGARDING THE ACQUISITION OF LSF11 SKYSCRAPER BY SIKA
INTERNATIONAL ,Para 20

28 P a g e
The Evaluation Criteria of Mergers and Factors Considered

The possible adverse effects of unregulated mergers do not need more emphasis. This sets the
basis for evaluation criteria of mergers that sets out various factors that are considered before
approval of mergers in the Kenya, United Kingdom and COMESA tripartite.

i) The Effect on Competition by The Mergers

The Competition Authority of Kenya Act of 2011 under Section 46 sets out the considerations
the authority is to take in account when evaluating mergers. These include whether the merger
would likely prevent or lessen competition, restrict trade, or endanger the continuity of supplies
or services.72 In the UK, the Competition and Markets Authority evaluates whether the merger
results in a substantial lessening of competition (SLC) within any market or markets in the UK.
The proposed merger between grocery giants Sainsbury's and Asda was blocked by the UK
Competition and Markets Authority (CMA) in April 2019 due to concerns over reduced
competition and increased prices for consumers.73

Under the COMESA Competition Regulations there is in play a substantive test in that. If the
CCC determines that a merger is likely to “substantially prevent or lessen competition it may
74
nevertheless consider public interest grounds to justify the transaction. In practice, PI concerns
are analyzed in detail in about 5% of notified transactions. 75 Thus in all these jurisdictions where
competition concerns are identified, the different regulatory authorities may consider public
interest (PI) justifications which we discuss further below.

ii) The Wider Public Interest Criteria on Mergers

All of Kenya, COMESA and the UK regimes evaluate the public interest effect of mergers. Thus,
in addition to evaluation of mergers from a competition standpoint they are extensively evaluated

72
Kevin Mathenge , ‘ Overview of Merger Control in Kenya,’ < https://mathenge.africa/overview-of-merger-
control-in-kenya/ > accessed 1st June 2025.
73
Tutore2unet,’ Examples of mergers that have been blocked by the CMA,’ <
https://www.tutor2u.net/economics/reference/examples-of-mergers-that-have-been-blocked-by-the-cma. >
accessed 1st June 2025.
74
Mellott, J., & Ciric, R. (2020). Public Interest in Merger Control: The Lay of the Land. The Antitrust Bulletin, 65(2),
208-226. https://doi.org/10.1177/0003603X20912892 (Original work published 2020)
75
ibid

29 P a g e
in terms of such mergers may lead to large scale job losses. For instance, in the National Bank of
Kenya/KCB Group merger, the CAK granted an approval under the condition that the merged
entity would retain 90% of its employees for 18 months following closing 76while when
Kenolkobil Plc proposed to acquire Gulf Energy Holdings Limited this was approved subject to
the retention of 102 employees for 24 months and maintenance of the preceding basic
remuneration and employment benefits. 77

In COMESA, mergers are reviewed not only for their effect on market competition but also their
potential to hinder cross-border trade, regional investment and economic equity among member
states. In Akzo Nobel N.V’s (“AkzoNobel”) acquisition of Kansai Plascon East Africa
Proprietary Limited (“KPEA”) and Kansai Plascon Africa Limited (“KPAL”) the CCC approved
the merger subject to a condition that the merging parties continue productions in the Malawi
manufacturing plant for a period of three years after the CCC’s decision to remedy the plant’s
potential closure and job losses resulting thereof.

In the United Kingdom, public interest in mergers is shaped by both competition regulation and
ministerial oversight. In addition to the CMA, the Enterprise Act of 2002 enables the government
through the Secretary of State for Business and Trade to intervene in mergers on specified public
interest grounds. Further, the United Kingdom being a world powerhouse is particularly sensitive
on the effect of mergers on national security evidenced by the legislation of the National Security
and Investment Act 2021. This gave the UK government expanded powers to review, approve or
block deals involving sensitive sectors such as defense, energy, artificial intelligence and data
infrastructure particularly in sectors like pharmaceuticals and technology. 78

The effect of this is that authorities can block or conditionally approve mergers based not just on
market dominance, but also on broader public concerns. For instance, if a merger threatens to
eliminate jobs in Kenya, CAK may deny or impose employment-retention conditions. A merger

76
Competition Authority of Kenya, Decision on Proposed Acquisition by KCB Group PLC of up to 100% of the
Ordinary Shares of National Bank of Kenya (2019), < https://www.cak.go.ke/sites/default/files/2019-09/CAK
%20Decision%20on%20Proposed%20Acquisition%20of%20100%25%20of%20the%20Ordinary%20Shares%20of
%20National%20Bank%20of%20Kenya%20Limited%20by%20KCB%20Group%20PLC.pdf> accessed 1st June 2025.
77
Baker Mckenzie Resource hub <https://resourcehub.bakermckenzie.com/en/resources/africa-competition-
guide/africa/kenya/topics/merger-control-developments?> accessed 1st June 2025.
78
The Guardian, ‘UK firms critical to public health protected from foreign takeovers’ <
https://www.theguardian.com/business/2020/jun/22/uk-firms-critical-to-public-health-protected-from-foreign-
takeovers-coronavirus.> accessed 1st June 2025.

30 P a g e
that might result in job losses in Malawi, for example, may be subject to special requirements by
CCC. In the UK, mergers in sensitive sectors like defense or tech can be blocked on national
security grounds even if competition is not affected. Businesses must therefore be prepared to
address these non-economic concerns with credible data and mitigation plans.

Possible Outcomes of the Mergers Notification Process

The outcomes of the three regimes are nearly uniform but may vary in the intensity of their
penalties. Mergers may be approved without conditions, approved with conditions and rejected
outright.

In terms of COMESA a merger that binds different jurisdictions could be allowed in one but
rejected in another state due to the adverse effects in that jurisdiction. In the aforementioned
Akzo Nobel case, the COMESA Competition Commission when releasing its decision to
prohibit the proposed acquisition by Akzo Nobel N.V uniquely prohibited the merger in 3
member states that are Eswatini, Zambia and Zimbabwe but accepted it in Malawi.

It is worth noting that the regional enforcement mechanisms of fines when regulating mergers
have been blunt to say the lease. Parties have been fast to fail to adhere to notification processes
set out by regional bodies such as that of the CCC citing sovereignty. CCC have also been slow
to impose fines and other measures when their rules and guidelines are breached. The imposition
of the fine to Helios Towers in 2021 is an indication that the CCC is sharpening its enforcement
activities. Thus, businesses operating in the Common Market must be aware of, and apply, the
applicable merger control and restrictive business practice laws or risk facing harsh enforcement
action.79

RECOMMENDATIONS

UK manufacturing enterprises are among Europe's top acquirers. In 1990, UK corporations

79
Burton Phillips and others, ‘COMESA Competition Commission issues first ever merger related fine - the time for
soft enforcement is over’< https://www.webberwentzel.com/News/Pages/comesa-competition-commission-
issues-first-ever-merger-related-fine.aspx. >accessed 2nd July 2025.

31 P a g e
completed 16% of all cross-border European mergers by value and 25% of all transactions by
number.80 In an increasingly globalized economy, cross-border mergers has become critical
strategy especially for businesses seeking growth, diversity, and a competitive advantage. 81
However, such transactions sometimes involve several regulatory systems, each with its own set
of laws and processes. Understanding the regulatory environments of the Competition Authority
of Kenya (CAK), the COMESA Competition Commission, and the UK's competition regulators
is critical for negotiating the complexity of cross-border mergers and acquisitions. The following
are recommendations to be taken into account to provide swift cross border mergers;

1. Incentives & Tariffs Reduction

To encourage cross border mergers adoption, governments should provide incentives such as tax
cuts or subsidies for enterprises that implement advanced risk management solutions. This would
stimulate more widespread use and improve overall supply chain resilience. 82 Addressing non-
tariff trade barriers and promoting regional cooperation. Free trade has potential economic
benefits. This will foster cross border merging.

2. Harmonization of substantive Law and Procedural laws

In theory, regional bodies such as COMESA function as a "one-stop-shop" and should thus ease
the merger control procedure for multi-jurisdictional mergers, although this is not always the
case. For example, in the EU, merging parties can apply to reallocate jurisdiction to the European
Commission if a deal results in multiple national filings or has clear regional effects (with
associated benefits such as reduced administrative burden and greater legal certainty), but this is
not currently possible with COMESA. In addition, some COMESA member nations, such as
Egypt, do not unconditionally recognize COMESA jurisdiction and require a second parallel
notice if their jurisdictional standards are satisfied.

2.1 Notification threshold

Notification requirements can be exceedingly low or depending on the parties' worldwide scale,
resulting in multinational deals with minimal local activity or no domestic competition
80
Kenneth Jansson, Michael Kirk‐Smith and Stephen Wightman, ‘The Impact of the Single European Market on
Cross Border Mergers in the UK Manufacturing Industry’ (1994) 94 European Business Review 8
<https://www.emerald.com/insight/content/doi/10.1108/09555349410054141/full/html> accessed 30 May 2025.
81
Kumar, S., & Soni, G. (2021), Preventive measures in supply chain risk management: A review. International
Journal of Production Economics, 233, 108013. https://doi.org/10.1016/j.ijpe.2020.108013
82
International Monetary Fund (IMF). (2023). Regional economic outlook: Sub-Saharan Africa. Retrieved from
https://www.imf.org/en/Publications/REO/SSA

32 P a g e
consequences captured. Once a transaction is notified, the review process might last substantially
longer than the minimum statutory time frame, particularly in places where information requests
since newly created bodies often take longer to evaluate complicated transaction structures or
markets. Align national and regional jurisdictions. Create a binding Memorandum of
Understanding (MoU) between the CAK and the COMESA Competition Commission to
facilitate the review of cross-border mergers. Clarify when dual notification is required versus
when COMESA review is suffices.

Finally, notification fees can be high in some countries, especially if calculated as a proportion of
the parties' global turnover or assets, or if a separate filing is required for each local subsidiary.
Occasionally, the cost may exceed the target business's local turnover. The notification fee
should be reduced to sustain a swift cross border merge.

2.2 Competition strategy

A significant number of Member States in COMESA have established competition authorities.

Only a few countries, including Kenya and Zambia, appear to be successful. National
competition authorities play a crucial role in assessing mergers and designing appropriate
remedies, as they are more familiar with cross-border effects in their jurisdiction. 83UK has the
CMA which regulates the mergers and ensure that competition is strictly scrutinized before
allowing the merger.

2.3 Institutional regulation of the merge

Institutions must maintain autonomy to prevent undue influence and jeopardize their integrity.
This should be accomplished by strict procedural and substantive legal provisions.
COMESA's decision-making process begins with the Commission, which investigates and offers
recommendations to the Committee Responsible for Initial Determination (CID) established by
Article 13 of the Regulations and Rule 24 of the COMESA Competition Rules. 84 The UK has a
two-stage phase that clearly scrutinizes the merger notification and procedure this clearly shows
that

83
Kumar, S., & Soni, G. (2021). Preventive measures in supply chain risk management: A review. International
Journal of Production Economics, 233, 108013. https://doi.org/10.1016/j.ijpe.2020.108013
84
Synthesis Paper on the Relationship of Trade and Competition Policy to Development and Economic Growth
(WTO 1998) and ELEANOR M FOX & ABEL M MATEUS, ECONOMIC DEVELOPMENT: THE CRITICAL
ROLE OF COMPETITION LAW AND POLICY (Edward Elgar. 2011).

33 P a g e
Notwithstanding its extensive judicial expertise in competition disputes, the EU has yet to rule
on extra-territoriality. In the Wood pulp case 85, it was determined that applying the Regulation is
justified under public international law if the behavior is expected to have an immediate and
significant impact on the Community. The CJEU failed to consider the effects doctrine, which is
necessary for extra-territorial application, and instead ruled on restrictive premises. The
European Commission emphasized in its 2008 annual report that “while the competition
provisions do not explicitly permit extraterritorial application, the EU, as a significant actor in an
increasingly globalized economy, must adopt a global perspective in its competition policy. 86”

However, compared to other regional competition authorities, the competition authorities/laws

of UK have a more crucial step in terms of the assessments of competition. Harmonization with
all the countries in terms of adoption of the regulation will foster the Cross-border mergers.
Marketing would be easy and faster as the laws will not be complex in nature. 87 Cross-Border
Collaboration strategies: Identifying successful strategies for risk management across COMESA
borders. This involves analyzing successful case studies to uncover critical success aspects.88

3. Implementation of measures to curb currency risks

Currency risk is defined as the dangers associated with the ever changing currency rates. 89 The
aforementioned posing significant risks especially with regards to the valuation of a target’s
value which can differ greatly in the time it takes to negotiate a deal to its completion. 90 There
are various ways this can be mitigated including contract mechanisms and hedging options. 91 The
former refers to clauses which can be included in the contract itself such as fixed price provisions
which sets the price which the target will be acquired at despite fluctuations. 92 Hedging options
85
John R. Stevenson in Department of State Bulletin, 12 October 1970, p 429.
86
The European Commission’s 2008 Report on Competition Policy, para 164.
87
The CMA’s “revised” approach to UK merger control and impact on M&A
https://competitionlawblog.kluwercompetitionlaw.com/2025/03/24/the-cmas-revised-approach-to-uk-merger-
control-and-impact-on-ma/

88

89
M Goodhart, T Koller & W Rehm ‘Getting a better handle on currency risk’ (2015) McKinsey
https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/getting-a-better-handle-on-
currency-risk
90
-- ‘Currency Risk Management in Cross- Border Merger and Acquisitions Transactions’ (2023)
https://acuitypartners.com.ng/currency-risk-management-in-cross-border-ma-transactions
91
ibid
92
ibid

34 P a g e
are also tools used to curb the adverse effects of currency fluctuations. 93 Common hedging
options include escrow holdback provisions where the buyer places a certain amount in a neutral
account and can withdraw sums when seller tampers with the value of the deal, the same can be
utilized to mitigate currency risks. 94 Another mitigating measure that can be implemented to curb
currency risks is the use of forward contracts. 95 Given that these contracts ensure the acquirer
doesn’t pay more than the previously agreed sum, they can be used to help ease the burden
currency risks pose on cross border mergers and acquisitions.

4. Modernization of financial systems and Training of Staff

Financial systems should be upgraded to meet the current technological advancements. The same
will streamline cross border mergers and acquisitions by for instance, inculcating Artificial
Intelligence in the financial systems thereby minimizing workload on personnel, enabling more
work to be done and faster. Such integration, amongst others, will enable seamless transfer of
funds across targets and acquirers. However, if the systems is upgraded and the staff remained
untrained, there will be an under-utilization of the resources. Therefore. Staff in financial
institutions such as banks should also be equipped with the expertise needed to handle modern
financial systems. This will enable them to work in synergy with the systems, thereby, resulting
in a seamless cross-border merger experience.

5. Issues and suggested reforms regarding public interest concerns

The Competition Authority of Kenya has always used the public interest test (PIT) when
considering the effects of merger and acquisition towards the public. 96 However according to a
study of a report by the Authority, the different sub sectors gave the following specific
recommendation as to what the CAK should add in the Public interest Test : Promote Local
shareholding/partnership for international investors gin Kenya, development and use of locally
manufactured resources/goods, potential to generate export earnings to the country, involvement
in Corporate Social Responsibility and Environmental Management, environmental, Social, and

93
n 10
94
ibid
95
ibid
96
Stella Musau, ‘Effect of Mergers and Acquisition on the Performance of the Manufacturing Sector in Kenya’.

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Governance (ESG) issues related to sustainability and survival of businesses post-merger and
Adherence to regulatory requirements such as KEBS standards.97

One crucial factor present in both COMESA member states and the UK regulations is the
complexities of addressing public interest concerns when balancing economic objectives like
wealth redistribution, job protection, and consumer welfare. 98 This is because public interest
conditions in mergers must be merger-specific, meaning they should directly address the effects
of the merger rather than broader sectoral or economic issues. 99 In Edgars Consolidated Stores
(Pty) Ltd/Rapid Dawn 123 (Pty) Ltd the sitting tribunal held that having restrictions on a single
company would make it beneficial to its competitors in the market and thus frustrate the intended
principle of the protecting the interests of the public. 100 The CAK should thus be very prudent
when considering the different cross border merger propositions.

Additionally, the exit of the UK from the European Union has seen the evolution of a facet of
public interest in Cross border merger regulation. This is in reference to national security. The
National Security and Investment Act 2021 which was enacted to promote national security
grants the UK government enhanced powers to scrutinize foreign investments in sensitive
sectors.101 This facilitates the incorporation of public interest considerations beyond pure
competition concerns in merger reviews.

While Kenya’s Competition Act already allows the Competition Authority of Kenya (CAK) to
consider public interest factors in sensitive sectors like energy and telecommunications, the
guidelines could be clarified and expanded to better define when these public interest
considerations should override competition concerns. 102 Parliament ought to likewise establish a
dedicated national investment review mechanism that operates separately but in coordination
with the CAK, whose mandate would be to specifically assess foreign acquisitions in
strategically important sectors such as energy, telecoms, and agriculture, similar to the UK's
97
ibid.
98
Robert Kaniu Gitonga, ‘Social and Political Goals of Mergers in Competition Law: Comparative Analysis of the
Efficiency and Public Interest Provisions in Kenya and South Africa’.
99
ibid.
100
Edgars Consolidated Stores (Pty) Ltd/Rapid Dawn 123 (Pty) Ltd.
101
Ioannis Kokkoris, ‘National Security as a Public Interest Consideration in UK Merger Control’ (2021) 14 Journal of
Strategic Security 47.
102
admin, ‘Role of Competition Authority of Kenya in Mergers & Acquisitions’ (WKA, 28 March 2025)
<https://www.wka.co.ke/the-role-of-competition-authority-of-kenya-in-mergers-and-acquisitions/> accessed 8
June 2025.

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approach post-Brexit.103 Such a framework would help safeguard national security and other
public interests while maintaining investor confidence.104

6. Integration of modern technology like Generative AI

Finally, the Competition Authority of Kenya ought to integrate Artificial Intelligence (AI) and
cloud computing technologies to increase efficiency, transparency, and enforcement capacity.
This follows the gracious reception the country has towards adoption and regulation of Artificial
Intelligence.105 Some of the advantages include the initial review of merger notifications through
pattern recognition and natural language processing as well as real-time access to case files,
streamline case management, and support risk-based enforcement by guiding resource allocation
based on predictive analytics.106 By utilizing these technologies, there shall be reduced reliance
on manual processes and an improvement in decision-making.

Additionally, these tools shall foster greater transparency, public engagement, and cross-border
collaboration by improving public access to compliance information, and making enforcement
data more accessible by cloud-hosted dashboards. They shall also warrant for centralized data
storage and facilitate cooperation with international regulators. 107 In conclusion AI-driven
training platforms may also facilitate the continuous professional development not just in the
CAK but also different stakeholders like the Capital Markets Authority and the Insurance
Regulatory Authority (IRA).

CONCLUSION.
This study emphasized the vital necessity for strong risk management measures. Diversification,
technology usage, and collaboration all provide elevation. Policymakers are encouraged to
standardize risk management procedures, boost technology adoption, and strengthen public-

103
‘(19) PUBLIC INTERESTS IN MERGERS & ACQUISITIONS; KENYA’S LESSONS FROM SOUTH AFRICA’S
JURISPRUDENCE. | LinkedIn’ <https://www.linkedin.com/pulse/public-interests-mergers-acquisitions-kenyas-
lessons-from-kiletyen/> accessed 8 June 2025.
104
admin (n 24).
105
John Syekei, Ariana Issaias and Richard Odongo, ‘Kenya: Unveiling of the National AI Strategy 2025-2030
&#8211; A Bold Step into the Future’.
106
‘OPPORTUNITIES AND CHALLENGES OF NEW TECHNOLOGIES FOR AML/CFT’
<https://www.fatf-gafi.org/content/dam/fatf/documents/reports/Opportunities-Challenges-of-New-Technologies-
for-AML-CFT.pdf>.
107
ibid.

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private partnerships. The UK provides a more predictable and business-friendly the environment.
Kenya can increase its competitiveness and attract more investment by better aligning with
regional entities, streamlining processes, and upgrading its analytical tools. Future research
should address growing threats like climate change and digitization to prepare firms and
policymakers in the COMESA and UK area to face future difficulties. Implementing these
guidelines improves supply chain resilience and contributes to international economic stability
and growth. In incorporation of the above recommendations will diversify the cross-border
merge of Kenya, COMESA and UK to greater heights in terms of marketing.

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