Advisory Board

  • Cai Hongbin
  • Peking University Guanghua School of Management
  • Peter Clarke
  • Barry Diller
  • IAC/InterActiveCorp
  • Fu Chengyu
  • China National Petrochemical Corporation (Sinopec Group)
  • Richard J. Gnodde
  • Goldman Sachs International
  • Lodewijk Hijmans van den Bergh
  • De Brauw Blackstone Westbroek N.V.
  • Jiang Jianqing
  • Industrial and Commercial Bank of China, Ltd. (ICBC)
  • Handel Lee
  • King & Wood Mallesons
  • Richard Li
  • PCCW Limited
  • Pacific Century Group
  • Liew Mun Leong
  • CapitaLand Limited
  • Martin Lipton
  • New York University
  • Wachtell, Lipton, Rosen & Katz
  • Liu Mingkang
  • China Banking Regulatory Commission (CBRC)
  • Dinesh C. Paliwal
  • Harman International Industries
  • Leon Pasternak
  • Bank of America Merrill Lynch
  • Tim Payne
  • Brunswick Group
  • Joseph R. Perella
  • Perella Weinberg Partners
  • Baron David de Rothschild
  • N M Rothschild & Sons Limited
  • Dilhan Pillay Sandrasegara
  • Temasek Holdings
  • Shao Ning
  • State-owned Assets Supervision and Administration Commission of the State Council of China (SASAC)
  • John W. Snow
  • Cerberus Capital Management, L.P.
  • Former U.S. Secretary of Treasury
  • Bharat Vasani
  • Tata Group
  • Wang Junfeng
  • King & Wood Mallesons
  • Wang Kejin
  • China Banking Regulatory Commission (CBRC)
  • Wei Jiafu
  • China Ocean Shipping Group Company (COSCO)
  • Yang Chao
  • China Life Insurance Co. Ltd.
  • Zhu Min
  • International Monetary Fund

Legal Roundtable

  • Dimitry Afanasiev
  • Egorov Puginsky Afanasiev and Partners (Moscow)
  • William T. Allen
  • NYU Stern School of Business
  • Wachtell, Lipton, Rosen & Katz (New York)
  • Johan Aalto
  • Hannes Snellman Attorneys Ltd (Finland)
  • Nigel P. G. Boardman
  • Slaughter and May (London)
  • Willem J.L. Calkoen
  • NautaDutilh N.V. (Rotterdam)
  • Peter Callens
  • Loyens & Loeff (Brussels)
  • Bertrand Cardi
  • Darrois Villey Maillot & Brochier (Paris)
  • Santiago Carregal
  • Marval, O’Farrell & Mairal (Buenos Aires)
  • Martín Carrizosa
  • Philippi Prietocarrizosa & Uría (Bogotá)
  • Carlos G. Cordero G.
  • Aleman, Cordero, Galindo & Lee (Panama)
  • Ewen Crouch
  • Allens (Sydney)
  • Adam O. Emmerich
  • Wachtell, Lipton, Rosen & Katz (New York)
  • Rachel Eng
  • WongPartnership (Singapore)
  • Sergio Erede
  • BonelliErede (Milan)
  • Kenichi Fujinawa
  • Nagashima Ohno & Tsunematsu (Tokyo)
  • Manuel Galicia Romero
  • Galicia Abogados (Mexico City)
  • Danny Gilbert
  • Gilbert + Tobin (Sydney)
  • Vladimíra Glatzová
  • Glatzová & Co. (Prague)
  • Juan Miguel Goenechea
  • Uría Menéndez (Madrid)
  • Andrey A. Goltsblat
  • Goltsblat BLP (Moscow)
  • Juan Francisco Gutiérrez I.
  • Philippi Prietocarrizosa & Uría (Santiago)
  • Fang He
  • Jun He Law Offices (Beijing)
  • Christian Herbst
  • Schönherr (Vienna)
  • Lodewijk Hijmans van den Bergh
  • Royal Ahold (Amsterdam)
  • Hein Hooghoudt
  • NautaDutilh N.V. (Amsterdam)
  • Sameer Huda
  • Hadef & Partners (Dubai)
  • Masakazu Iwakura
  • Nishimura & Asahi (Tokyo)
  • Christof Jäckle
  • Hengeler Mueller (Frankfurt)
  • Michael Mervyn Katz
  • Edward Nathan Sonnenbergs (Johannesburg)
  • Handel Lee
  • King & Wood Mallesons (Beijing)
  • Martin Lipton
  • Wachtell, Lipton, Rosen & Katz (New York)
  • Alain Maillot
  • Darrois Villey Maillot Brochier (Paris)
  • Antônio Corrêa Meyer
  • Machado, Meyer, Sendacz e Opice (São Paulo)
  • Sergio Michelsen Jaramillo
  • Brigard & Urrutia (Bogotá)
  • Zia Mody
  • AZB & Partners (Mumbai)
  • Christopher Murray
  • Osler (Toronto)
  • Francisco Antunes Maciel Müssnich
  • Barbosa, Müssnich & Aragão (Rio de Janeiro)
  • I. Berl Nadler
  • Davies Ward Phillips & Vineberg LLP (Toronto)
  • Umberto Nicodano
  • BonelliErede (Milan)
  • Brian O'Gorman
  • Arthur Cox (Dublin)
  • Robin Panovka
  • Wachtell, Lipton, Rosen & Katz (New York)
  • Sang-Yeol Park
  • Park & Partners (Seoul)
  • José Antonio Payet Puccio
  • Payet Rey Cauvi (Lima)
  • Kees Peijster
  • COFRA Holding AG (Zug)
  • Juan Martín Perrotto
  • Uría & Menéndez (Madrid/Beijing)
  • Philip Podzebenko
  • Herbert Smith Freehills (Sydney)
  • Geert Potjewijd
  • De Brauw Blackstone Westbroek (Amsterdam/Beijing)
  • Qi Adam Li
  • Jun He Law Offices (Shanghai)
  • Biörn Riese
  • Mannheimer Swartling (Stockholm)
  • Mark Rigotti
  • Herbert Smith Freehills (Sydney)
  • Rafael Robles Miaja
  • Robles Miaja (Mexico City)
  • Alberto Saravalle
  • BonelliErede (Milan)
  • Maximilian Schiessl
  • Hengeler Mueller (Düsseldorf)
  • Cyril S. Shroff
  • Cyril Amarchand Mangaldas (Mumbai)
  • Shardul S. Shroff
  • Shardul Amarchand Mangaldas & Co.(New Delhi)
  • Klaus Søgaard
  • Gorrissen Federspiel (Denmark)
  • Ezekiel Solomon
  • Allens (Sydney)
  • Emanuel P. Strehle
  • Hengeler Mueller (Munich)
  • David E. Tadmor
  • Tadmor & Co. (Tel Aviv)
  • Kevin J. Thomson
  • Barrick Gold Corporation (Toronto)
  • Yu Wakae
  • Nagashima Ohno & Tsunematsu (Tokyo)
  • Wang Junfeng
  • King & Wood Mallesons (Beijing)
  • Tomasz Wardynski
  • Wardynski & Partners (Warsaw)
  • Rolf Watter
  • Bär & Karrer AG (Zürich)
  • Xiao Wei
  • Jun He Law Offices (Beijing)
  • Xu Ping
  • King & Wood Mallesons (Beijing)
  • Shuji Yanase
  • OK Corporation (Tokyo)
  • Alvin Yeo
  • WongPartnership LLP (Singapore)

Founding Directors

  • William T. Allen
  • NYU Stern School of Business
  • Wachtell, Lipton, Rosen & Katz
  • Nigel P.G. Boardman
  • Slaughter and May
  • Cai Hongbin
  • Peking University Guanghua School of Management
  • Adam O. Emmerich
  • Wachtell, Lipton, Rosen & Katz
  • Robin Panovka
  • Wachtell, Lipton, Rosen & Katz
  • Peter Williamson
  • Cambridge Judge Business School
  • Franny Yao
  • Ernst & Young

Africa

AFRICAN UPDATE: The Global Briefing For Africa: Interview with Stephen Karangizi

Editors’ Note:  Contributed by Nigel Boardman, a partner at Slaughter and May and a founding director of XBMA.  Mr. Boardman is one of the leading M&A lawyers in the UK with broad experience in a wide range of cross-border transactions.

Main Article:  The following is a 5 minute interview with Stephen Karangizi, CEO and Director of the African Legal Support Facility. The African Legal Support Facility, hosted by the African Development Bank, has been supporting African governments in the negotiation of complex commercial transactions since 2010.  To find out more about the ALSF, please click here.

  1. What are the key areas of opportunity to capitalize on for Africa’s development?

The key opportunities for Africa’s development lie in taking advantage of the advances in Information Technology as well as a large young population.  Business opportunities remain for those who have long term objectives as the cost of business has gone down in a number of African countries and investment returns in Africa are always higher.  In addition, an expanding middle class of youth means a large absorptive market.

  1. Could the presidential elections that are going to happen in the next three years in Africa announce important political changes? Will these have consequences on the economic policy and on Human Rights in Africa?

The political dynamics of African countries differ from one country to another.  On the whole, Presidential elections do not impact significantly on a country unless the country relapses into a conflict situation like Burundi.

  1. Will the COP 21 and the international aid programmes for developing countries be a source of new economic developments in Africa?

Yes it should but also depends on your view point.  Some people argue that Aid is recycled: old commitments are modified to appear as if it is new Aid.  So one needs to look at the specific aid in question.  But at least some of the new Aid can be dedicated to climate favourable investments such as renewable energy. For instance off-grid renewable energy solutions can have quick development benefits for African rural communities not connected to national electricity grids.

  1. China’s growth is slowing down and the country is facing financial problems. Will this lead to less Chinese investments in Africa?

I am not sure whether that is the case but China has already made large investment commitments in Africa.  Africa also provides China with new investment opportunities.  Chinese investors can take advantage of the comparative labour costs which are lower in Africa.  An example in point is the successful leather processing industry established in Ethiopia in partnership with a Chinese company that has been very successful.

I think it’s more of the China economy slowing down due to various factors and not necessarily financial problems.

The views expressed herein are solely those of the author and have not been endorsed, confirmed, or approved by XBMA or any of the editors of XBMA Forum, nor by XBMA’s founders, members, contributors, academic partners, advisory board members, or others. No inference to the contrary should be drawn.

AFRICAN UPDATE – New Multi-National COMESA Merger Notification Regime in Africa Requires Advance Planning for a Wide Range of International Merger Transactions

Editors’ Note: This article was submitted by I. Berl Nadler, a partner at Davies Ward Phillips & Vineberg LLP and a leading Canadian corporate lawyer who has been involved in numerous high-profile financing transactions and acquisitions worldwide on behalf of multinational corporate clients. Davies Ward partners John Bodrug, Jim Dinning and Hillel Rosen, experts in the firm’s Competition & Foreign Investment Review practice, co-authored this article.

Highlights:

  • In January 2013, a supranational organization of 19 African States known as “COMESA” implemented a new and potentially burdensome merger notification regime affecting parties with assets or sales in eastern or southern Africa.
  • Pre-merger notification is required for any merger where either the acquiror or the target operates in at least two COMESA member States. Arguably, notification may be required only if the merger will have an appreciable effect on trade between member States and restricts competition in COMESA.  The definition of “operates” in this context is unclear, as are the exemptions.
  • Under the Regulations, the test for CCC approval is whether the merger:
    a)  has lessened substantially or is likely to lessen substantially the degree of competition in COMESA or any part thereof; or
    b)  has resulted, or is likely to result in, or strengthen a position of dominance which is or will be contrary to the public interest.
  • A COMESA filing must be made within 30 days of the parties’ “decision to merge”.  The review period is 120 days, although the CCC may seek extensions from the Board of Commissioners of COMESA.  The Regulations and merger notification form (currently available only in draft) do not expressly prohibit closing a merger pending completion of the CCC’s review; it is unclear what is intended by this omission.

Main Article:

In January 2013, a supranational organization of 19 African States known as “COMESA” implemented a new and potentially burdensome merger notification regime that should be considered in the context of any mergers involving parties with assets or sales in eastern or southern Africa.  Some important questions remain unanswered at this time, but it appears likely that the regime will add uncertainty and require additional advance planning for transactions involving companies active in the region.  This perspective provides a brief overview of its potential application.

COMESA

COMESA stands for the Common Market for Eastern and Southern Africa, and comprises the following member States:  Burundi, Comoros, the Democratic Republic of Congo, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Sudan, Swaziland, Uganda, Zambia, and Zimbabwe.

Merger Notification Thresholds

Pursuant to the COMESA Competition Regulations (“Regulations”) establishing the COMESA Competition Commission (“CCC”), a pre-merger notification is required for any merger where either the acquiror or the target operates in at least two COMESA member States.  The CCC recently set the financial threshold for notification at $0 in assets or revenues, and the definition of “operates” in this context is unclear.  For example, it remains to be seen whether the CCC will take the position that a company that merely owns land or mineral rights in two or more member States, but otherwise has no other assets or operations in COMESA, would satisfy the notification threshold.

The Regulations apply only to mergers that have an appreciable effect on trade between member States and which restrict competition in COMESA.  This requirement may exempt transactions from notification where only the acquiror has operations in the region, although the scope of the exemption is unclear.

The Regulations define a “merger” as the acquisition or establishment of a controlling interest in the whole or part of the business of another person.  However, the definition of a “controlling interest” is unclear and includes any interest that enables the holder to directly or indirectly exercise “any control whatsoever” over the activities or assets of an undertaking.  It remains to be seen whether the CCC will broadly interpret this provision and whether the acquisition or establishment of a minority interest, board representation or even contractual rights could amount to a “controlling interest”.

Interaction with Filing Obligations in COMESA Member States

Where a COMESA notification is required, the CCC intends for the COMESA regime to operate to the exclusion of individual notification regimes in COMESA member States.  (Currently, eight of 19 COMESA member States have their own notification regimes.)  However, recent media reports indicate that in some circumstances both COMESA and the Kenyan competition authority have asserted jurisdiction (and notification obligations) over the same transaction.  Until there is more clarity in this regard, merging parties may be wise to approach both the CCC and applicable State-level regulators in transactions subject to notification in the region.

Substantive Test for Approval

Under the Regulations, the test for CCC approval is whether the merger:
a)  has lessened substantially or is likely to lessen substantially the degree of competition in COMESA or any part thereof; or
b)  has resulted, or is likely to result in, or strengthen a position of dominance which is or will be contrary to the public interest.

This test is generally consistent with tests for approval in other jurisdictions.

Timing of Review

If a COMESA filing is required, it must be made within 30 days of the parties’ “decision to merge”.  (We understand that the CCC is of the view that “days” in the Regulations means business days and not calendar days.)  While unclear, it appears that the CCC may be taking an expansive view of when the “decision to merge” has been made and may have in mind that the filing requirement could be triggered by a board decision even before a merger agreement is entered into.

The review period is 120 days, although the CCC may seek extensions from the Board of Commissioners of COMESA.  At present, the CCC does not appear to have provided for an accelerated timetable for mergers that raise no substantive issues.

The Regulations do not expressly prohibit closing a merger pending completion of the CCC’s review.  While the merger notification form (currently available only in draft) notes that mergers implemented in contravention of the Regulations will be of no legal effect, the draft form no longer includes a statement (found in the prior draft) that parties cannot close their transaction until CCC approval has been received.  Accordingly, the change in the draft form may signal a position of the CCC that the parties may complete a merger before the CCC has completed its review (absent an injunction or other enforcement action).

Notification Form

A notification form must be submitted by each party to a transaction (except in the case of an unsolicited bid, where only the acquiror must submit a notification).  Unless significant changes are made or exceptions permitted, the form will necessitate the provision of extensive information regarding, among other things, sales, customers and competitors.

Notification Fees and Penalties

If a filing is required, the notification must be accompanied by a filing fee equal to the lesser of:  (a) US$500,000; or (b) the lower of 0.5% of the parties’ combined turnover or 0.5% of the parties’ combined assets in the COMESA region.  (Although the CCC has stated that the lower of these two figures is intended to apply, the Regulations themselves are somewhat unclear.)

If the parties to a transaction fail to file within the required timeframe, they may be subject to a penalty of up to 10% of their combined annual turnover in COMESA.  In addition, as noted above, a merger implemented in contravention of the Regulations will be of no legal effect in COMESA.

Summary

Compliance with the COMESA merger notification regime may need to be added to the competition approval checklist for a merger involving a party with operations in two or more COMESA member States.  This approval, if required, could result in significant costs and potential delay.  A significant amount of uncertainty about the application of the COMESA merger notification regime remains and further clarification from the CCC is needed.

The views expressed herein are solely those of the author and have not been endorsed, confirmed, or approved by XBMA or any of the editors of XBMA Forum, nor by XBMA’s founders, members, contributors, academic partners, advisory board members, or others. No inference to the contrary should be drawn.

XBMA – Quarterly Review for Q1 2011

Editor’s Note: This is an example of the type of post and content the XBMA Forum seeks to showcase.

The attached slides summarize trends in cross-border M&A and strategic investment activity throughout the first quarter of 2011.

 

Highlights:

  • Global M&A volume for Q1 2011 was US$671.8 billion, up 29.5% as compared to Q1 2010.
  • Cross-border transactions have rebounded substantially from 2009: 38% of Q1 2011 global M&A was cross-border — up slightly from 37% in 2010 and up significantly from the low of 26.8% in 2009.
  • Canada and Australia’s shares of global M&A each more than double their respective shares of world GDP, perhaps reflecting the large number of deals involving natural resources.
  • Distressed deals have exceeded US$75 billion per annum since 2009.
  • Energy M&A remains the most active among cross-border transactions – reflecting the ongoing pressure to acquire natural resources to fuel emerging economies and the churn created by political instability in the Middle East and by the widespread adoption of technological improvements in the natural gas industry – with Materials and Financials cross-border M&A in the second tier.

XBMA Quarterly Review for Q1 2011

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