SENEGAL Law and Practice Contributed by: Khaled Abou El Houda, Malick Lo, Chadi Safieddine and Mohamed Kamil, SCP Houda & Associés
• Extraordinary management acts The Board of Directors must explicitly inform the regulator of any decision to perform acts “other than ordi - nary course management” ( autres que de gestion courante ). This allows the regulator to monitor the implementation of “poison pills” or the disposal of “crown jewels”. • Prohibited manoeuvres Any action or issuance of securities intended to impede the regular function - ing of the market without prior regulatory approval (visa) is deemed a fraudulent manoeuvre. 9.4 Directors’ Duties Directors’ Duties in Takeover Defences (Senegal/ UEMOA) Under the AMF-UMOA General Regulations, the direc - tors of the target company are subject to strict duties in order to ensure market transparency and integrity. • Transparency obligation Directors must notify the regulator of any “defence agreement” entered into with partners within 15 days of notification of the offer. • Duty to provide information (reasoned opinion) The Board of Directors is required to provide a “rea - soned opinion” on the merits of the offer and its consequences for the company and its sharehold - ers. • Limitation of powers (day-to-day management) During the offer period, directors must inform the regulator of any decision to carry out “acts other than day-to-day management”, thereby limiting their ability to unilaterally frustrate the offer. • Responsibility and loyalty Directors must act with loyalty and fairness in the interests of investors. Any defence measure that is not targeted or trans - parent is classified as a “manoeuvre intended to impede the regular functioning of the market”. • Insider trading prohibition From the earliest stages of a proposed bid, directors are prohibited from trading in securities if they possess confidential information, under penalty of being sanctioned for “fraudulent acts or manoeuvres”. 9.5 Directors’ Ability to “Just Say No” Directors in Senegal do not have the ability to “just say no” to a proposed business combination. Their pow -
ers are framed by OHADA company law and, where applicable, by the company’s articles of association. While directors may influence the outcome of a trans - action through recommendations, negotiations or the exploration of alternative proposals, the ultimate deci - sion typically rests with the shareholders, particularly in transactions involving a transfer of control or sig - nificant corporate restructuring. Any defensive measures adopted by directors must comply with their fiduciary duties, the company’s cor - porate governance framework and, in the case of list - ed companies, applicable market transparency rules. 10. Litigation 10.1 Frequency of Litigation Frequency and Common Drivers Litigation is frequent in our experience in connection with M&A transactions in Senegal. 10.2 Stage of Deal While parties prioritise amicable settlements, disputes often arise during two main phases, as follows. • Post-closing claims These are the most common, and typically involve the enforcement of warranties and indemnities (W&I). Buyers frequently initiate proceedings following the discovery of undisclosed tax, social, or other liabilities. • Price adjustments Disputes regarding earn-outs or the finalisation of completion accounts are recur - ring, often requiring the appointment of an inde - pendent expert to resolve valuation gaps. 10.3 “Broken-Deal” Disputes Lessons From COVID-19 and Drafting Trends Evolution of MAE/MAC clauses Before 2020, material adverse change (MAE/MAC) clauses were often generic. The main lesson learned is the need to explicitly exclude or include health crises. In 2026, the trend is toward “tailor-made” clauses. • Specific exclusions Sellers now require that pan - demics, epidemics, and related administrative measures be expressly excluded from the definition
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