To Notify or Not Notify: The New Merger Notification Guidelines in Morocco

In many cases, the parties to foreign-to-foreign economic concentration transactions (merger, acquisition or joint venture) that meet the criteria for notification to the Moroccan Competition Council to obtain clearance prior to closing are often advised that, because the proposed transaction is not expected to have any impact on competition in Morocco, a notification is not required. In this article, in light of the new Guidelines, the authors intend to clarify the current state of affairs in Morocco.

In the new Guidelines on the Control of Economic Concentration Transactions, published by the Moroccan Competition Council on 11 December 2023, in the wake of the publication of Decree No 2-23-273 of 22 May 2023 (amending Decree No 2-14-652 of 1 December 2014), taken in application of, and marking the entry into force of, Law No 40-21 amending and completing Law No 104-12 on the Freedom of Prices and Competition, the Council considers that “under certain specific conditions, some economic concentration transactions, although meeting the turnover thresholds set out in Article 8 of Decree No 2-14-652, are not subject to notification” (paragraph 67).

The new turnover thresholds set out in Article 8 of Decree No 2-14-652, as amended and completed, and in force since May 2023, are:

The exceptions provided for by the Council in the Guidelines are those where:

For the parties, the test can thus be conducted summarily since, if there is absolutely no legal or commercial link, direct or indirect, on a vertical or horizontal level between them (or their groups), then, according to the Guidelines, the transaction is not subject to notification, irrespective of either of the notification thresholds being met or of the potential impact on competition in Morocco if it is.

The authors could end here, if the failure to notify the Moroccan Competition Council did not carry with it the potential for the transaction to be considered null and void in Morocco and a fine that can reach up to 10% of the Moroccan turnover of the parties concerned being imposed, which makes the summary test above a risky proposition, if there is any chance that the Council may, ex post facto, determine that there was, in fact, a legal or commercial link between the parties – however tenuous it may be – and (assuming that the notification thresholds are met) a notification should have been made.

An example of such a link, putting the transaction outside the scope of the exemption and within the parameter of mandatory notification, could be the presence, in one of the groups concerned, of an online travel booking agency and, in the other group concerned, of a car rental company advertising on its website. As such, in case of doubt, it is usually recommended, as per the Guidelines, to consult the Instruction Services of the Council, by presenting “a summary of the proposed transaction and the documents required for a determination” (paragraph 7 of Article 8 of Decree No 2-14-652).

If the transaction is not subject to notification under Articles 11 and/or 12 of Law No 104-12, the parties will be notified in writing; if the transaction is subject to notification, the businesses responsible for notifying the Council will be invited to make a formal notification.

In all cases where a notification is required but the parties are of the opinion that the proposed transaction does not raise competition issues on any market in Morocco, they can request in writing to make a filing under the simplified procedure set out by Article 9bis of Decree No 2-14-652, as amended and completed, with the documents required to make that determination.

The simplified procedure is open to the parties when:

Whether the Council agrees or disagrees, the parties will be informed in writing within five days of the receipt of the request. If the request is denied, the parties will be required to submit a full notification. Besides being a speedier procedure (with a decision within 30 business days on average), the main advantage of following the simplified procedure resides in the reduced need for communication of sensitive data by the parties, at least from the outset of the procedure.

To note, the simplified procedure is not the “accelerated procedure” also available under Moroccan Law and that requires paying double the normal filing fee; the fee associated with the simplified procedure is the standard fee.

This article is for information purposes only and is not intended as legal advice or recommendation in connection with any specific matter. Please consult a Moroccan lawyer or qualified legal adviser in relation to any competition-related issue.