EGYPT Law and Practice Contributed by: Alex Saleh, Asad Ahmad, Hegui Taha and Farida Koura, GLA & Company
2.13 Penalties for the Implementation of a Transaction Before Clearance Gun jumping is prohibited under the Egyptian Competition Law (see 2.12 Requirement for Clearance Before Implementation and 2.2 Fail- ure to Notify with respect to the penalties). 2.14 Exceptions to Suspensive Effect The ECA may authorise the implementation of the “economic concentrations” despite its anti- competitive effect via approval from the Cabinet of Ministers in line with Article 19 bis b of the Egyptian Competition Law and Article 60 of the Executive Regulations if the: • non-implementation of the “economic con - centration” would result in the exit of one of them from the market (failing firm); • implementation of the “economic concentra - tion” would lead to economic efficiency that outweighs its anti-competitive effects; or • “economic concentration” is related to the protection of national security. Failing Firm The conditions that have to be met to benefit from the failing firm exception are as follows: • one of the concerned persons has financial difficulties in a way that leads to the exit of that person and their assets from the market; and • there is no less anti-competitive alternative than the “economic concentration”. Economic Efficiency The conditions that have to be met to benefit from the economic efficiency exception are as follows: • the economic efficiency must be verifiable;
• the economic efficiency cannot be achieved other than through the implementation of the “economic concentration”; and • the economic efficiency should benefit con - sumers. 2.15 Circumstances Where Implementation Before Clearance Is Permitted The circumstances where the authorities will per - mit closing before clearance are not addressed under the Egyptian Competition Law. Howev - er, the ECA may, on a case-by-case basis, be approached to grant clearance for a carve out arrangement to stakeholders. The ECA must be notified of any “economic con - centration” that meets the conditions set out in Article 19 bis of the Egyptian Competition Law before it is implemented. The notifying person must submit a written request, whether elec - tronically or on paper, to the ECA to schedule a date for the submission of the notification file. The ECA will then set a date within a maximum of two working days from the date of submitting the request. It is preferable to submit the notification file at any of the following phases: 3. Procedure: Notification to Clearance 3.1 Deadlines for Notification • the conclusion of a memorandum of under - standing or letter of intent (preliminary agree - ment); • the conducting of serious negotiations regarding the “economic concentration”; • the announcement of the purchase offer; or
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