CONGO BRAZZAVILLE Law and Practice Contributed by: Louis-Raymond Gomes and Prince Kyssama Dikoulou, Cabinet Gomes
The management team of the target company often provides broader warranties, particularly concerning the accuracy of information provided, proper manage - ment of the company, and the absence of breaches of fiduciary duties. These warranties can expose man - agement to personal liability, especially if misrepre - sentation or wilful misconduct is proven. Regarding data room disclosure, there is no statu - tory prohibition on allowing the data room to serve as a disclosure mechanism against warranties, though this practice is not commonly adopted in Congo- Brazzaville. 6.10 Other Protections in Acquisition Documentation The other common protection that can be included in acquisition documentation is the escrow. Warranty and indemnity (W&I) insurance is not commonly seen, but can be assimilated into the guarantee d’actif et de passif mechanism, in which there is an indemnification protection on warranties. 6.11 Commonly Litigated Provisions When disputes arise, they are most commonly linked to valuation issues and consideration mechanics – particularly disagreements over the valuation of shares or assets and payment of the acquisition price, including deferred payments or earn-out mechanisms. In addition, warranties and indemnities are frequent sources of disputes, especially where post-closing issues emerge concerning undisclosed liabilities, tax exposures or regulatory non-compliance claims. 7. Takeovers 7.1 Public-to-Private This is not common, and the authors are not aware of any precedent relating thereto. 7.2 Material Shareholding Thresholds and Disclosure in Tender Offers The Congolese capital market is underdeveloped, and most companies are privately held. The primary disclosure and filing obligations are instead dictated by OHADA company law and CEMAC regulations,
including competition (antitrust) thresholds and foreign investment notifications (foreign exchange regulation). Where applicable, material shareholding disclosure thresholds are linked to changes in control or signifi - cant acquisitions that may trigger competition law fil - ings with CEMAC’s Regional Competition Authority ( Commission de la Concurrence de la CEMAC ). 7.3 Mandatory Offer Thresholds As most companies in Congo-Brazzaville are privately held, acquisitions are structured through negotiated share purchase agreements or mergers, and there are no statutory rules requiring a bidder to make an offer to all shareholders once a control threshold is crossed. Furthermore, consolidation or attribution of sharehold - ings among affiliated or related entities (such as other private equity funds or portfolio companies) does not create any specific legal obligations. These matters are typically addressed in the shareholders’ agree - ment or through contractual arrangements, rather than statutory regulation. 7.4 Consideration There are no statutory minimum price rules applicable to tender offers or acquisitions in Congo-Brazzaville, largely because public tender offers are not common in this jurisdiction. Valuation is typically determined through negotiation between the parties, based on due diligence findings and market conditions. However, under OHADA law, the nominal value of a share (as stated in the company’s by-laws or articles of association) serves as a reference for share transfers within certain corporate transactions. While it does not impose a minimum price rule for private equity deals, it provides a baseline below which the transfer price cannot be set without adjusting the company’s share capital. 7.5 Conditions in Takeovers This is not applicable; this area is not regulated.
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