UAE Law and Practice Contributed by: Amir Alkhaja, Areen Jayousi, Gulsun Ozmen and Alia AlMarzooqi, Habib Al Mulla & Partners
6.3 Cartels Prohibition
A mandatory notification obligation arises where either threshold is met. Full-function joint ventures, those performing all the functions of an autonomous eco - nomic entity on a lasting basis, are treated as concen - trations subject to notification where the applicable thresholds are satisfied. Parties should assess both thresholds at the time of transaction planning, as satisfaction of either is sufficient to trigger the filing obligation regardless of whether the other threshold is met. 6.2 Merger Control Procedure Filing, Standstill and Review Notification must be filed with the Ministry of Economy before completion of the transaction. The implement - ing regulations issued pursuant to Cabinet Decision No 59 of 2026 (expected to take effect on the 30 July 2026) clarify the notification procedures and the infor - mation and documentation required to accompany a complete filing, including details of the parties and transaction structure, relevant market definitions, mar - ket share and turnover data, and financial information. The Ministry has ninety (90) calendar days from receipt of a complete notification to issue its deci - sion, extendable by a further forty-five (45) calendar days; during this standstill period the parties may not complete the transaction. Note that if no decision is issued within the applicable period, the transaction is deemed rejected. The Ministry may request sup - plementary information during the review, which may extend the timeline, and parties are encouraged to engage with the Ministry proactively and at an early stage where there is any uncertainty about whether either threshold is satisfied. Decision and Consequences of Non-Compliance The Ministry may approve the transaction uncondi - tionally, approve it subject to conditions which may include structural remedies such as divestitures or behavioural commitments, or prohibit it outright on competition grounds. Completing a notifiable trans - action without notification or in breach of the stand - still obligation may result in significant administrative penalties and, in serious cases, the unwinding of the completed transaction.
The Competition Law prohibits agreements, con - certed practices and decisions of associations of undertakings that have as their object or effect the prevention, restriction or distortion of competition in the UAE market. The prohibition applies to both hori - zontal arrangements between competitors and verti - cal arrangements between suppliers and distributors. Hard-core horizontal restrictions including price-fix - ing, market allocation, bid rigging and output limitation are treated as the most serious category of infringe - ment and attract maximum penalties regardless of actual market effect. Vertical arrangements incorpo - rating hard-core restraints, such as resale price main - tenance or absolute territorial protection, are similarly prohibited. Enforcement and Extra-Territorial Reach The Ministry has broad investigative powers, includ - ing the ability to request documents, conduct on-site inspections and interview employees. The Competi - tion Law applies on an effects basis: anti-competitive conduct carried out entirely outside the UAE falls within scope where it has actual or potential effects on competition within the UAE market. Administrative fines for prohibited agreements may reach up to 10% of the violating entity’s total UAE revenues during the period of the infringement, with higher penalties appli - This refers to the abuse by one or more undertak - ings of a dominant position in the UAE market or a substantial part thereof. Pursuant to Cabinet Resolu - tion No 3 of 2025, a company is generally presumed to hold (whether solely or in conjunction with other establishments) a dominant position where its market share equals or exceeds 40% of the relevant market, although dominance may also be established based on broader indicators of market power and the abil - ity to act independently of competitors, customers or consumers. cable in cases of repeat violation. 6.4 Abuse of Dominant Position Dominance and Prohibited Conduct Prohibited abusive conduct includes imposing unfair purchase or selling prices, limiting production or mar -
1057 CHAMBERS.COM
Powered by FlippingBook