NIGERIA Law and Practice Contributed by: Chiagozie Hilary-Nwokonko and Chukwuyere Ebere Izuogu, Streamsowers & Köhn
In terms of foreign investment, the Nigerian Investment Promotion Commission Act provides that a foreign national can own up to 100% of a business or invest in any business except those on the negative list. Prohibited activities include: • the production of arms, ammunition, etc; • the production of and dealing in narcotic drugs and psychotropic substances; • the production of military and paramilitary wear and accoutrements, including those of the police and the customs, immigration and prison services; and • other similar activities, determined by the Federal Executive Council. 1.3 Enforcement Authorities The FCCPC is Nigeria’s lead competition author - ity responsible for enforcing the FCCPA. In its review of mergers involving parties that are also subject to regulatory oversight of other sector- specific regulators, the FCCPC typically requires a letter of no objection from the relevant regu - lator before granting unconditional approval for the transaction. An exception applies to the financial services sector. Pursuant to the provisions of BOFIA, the CBN has been conferred exclusive jurisdiction for enforcing the competition and consumer protection provisions of the FCCPA within the financial services sector. This exclusive mandate extends to reviewing and approving mergers occurring in any aspect of the financial services market.
fication. Under the FCCPA, a merger becomes notifiable to the FCCPC if it meets the criteria specified as constituting a relevant merger situ - ation. According to paragraph 2.3 of the Merger Review Guidelines (MRG) issued by the FCCPC, a relevant merger situation is created where the following cumulative criteria are met: • two or more undertakings must come under common control, or there must be arrange - ments in progress or in contemplation which, if carried into effect, will lead to the undertak - ings coming under a common control to be distinct; and • either the Nigerian turnover in the preceding year of the undertaking that is being acquired exceeds the prescribed threshold or the com - bined value of the Nigerian element of the merging undertakings in the preceding year exceeds the prescribed threshold (known as the “turnover test”), as stipulated in the Notice of Threshold for Merger Notification 2019 (Threshold Regulations) issued by the FCCPC. If the FCCPC believes that the first criterion has not been met, it will not consider the second criterion, as a relevant merger situation is not created. In addition, where a Nigerian undertak - ing comes under the control of a foreign under - taking, the merger may be subject to notification if the turnover test under the Threshold Regula - tions is met or if the acquisition of the Nigerian undertaking affects the market structure by pre - venting or lessening competition in Nigeria. The standard used by the FCCPC to assess the jurisdictional threshold for mergers in the finan - cial services sector is likely to be the same as the standard applied by the CBN when determining whether a relevant merger situation exists. In the communications sector, the following types of
2. Jurisdiction 2.1 Notification
Notification to the FCCPC is only required if the merger meets the jurisdictional threshold for noti -
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