In the state of Qatar, Law No.19 of 2006 Concerning the Protection of Competition and the Prevention of Monopoly Practices (“Competition Law”) constitutes the governing law along with the Ministry Resolution No.61 of 2008 implementing the Executive Regulations of Law No.19 of 2006 Concerning the Protection of Competition and the Prevention of Monopoly Practices (“Executive Regulations”).

Under Qatari law, a merger occurs when one company is merged into another company, or one or more companies are merged into a new company. The mergers scale in the state of Qatar is quite rare, in respect and comparison with other jurisdictions as Egypt, Kuwait or Kingdom of Saudi Arabia.

The merger control in certain regulated activities

The Qatar Central Bank (“QCB”) is governed by the QCB Law, which details the mechanism for the merger of financial institutions, subject to the thresholds and procedures set out in the Companies Law and the restrictions set out in the New Foreign Investment Law.

Under the QCB Law, two scenarios are foreseen for the merger of two or more financial institutions, either two or more companies can merge into a new company, or the target can merge into the acquirer. In both cases, the following steps must be taken:

• approval of the QCB for the merger is required;
• a preliminary agreement, must be signed;
• a full due diligence review must be undertaken; and
• a submission of all required documents and data must be conducted before the QCB. Further, QCB’s president has 60 days to issue a decision either by approving or rejecting the merger.

Notification

Any violation of the Competition Law will be penalised by a fine of no less than QAR100,000 and no more than QAR5,000,000.

Types of transactions

 The Competition Law applies to the following transactions:

• persons intending to possess assets, ownership rights or usufructs;
• persons intending to buy stocks; and
• persons intending to create consortiums or mergers or combine the management of two ‒ or more ‒ corporate persons in a way that leads to domination in the market.

The Competition Law exempts state actions and institutions under the supervision of the state. The Minister has the right to exempt agreements that promote consumers’ welfare. 

The Committee has the right to exclude any mergers or acquisitions deemed by it to contribute to economic development in a way that may compensate for the prejudice to competition. 

Thresholds

 The Competition Law and Executive Regulations apply to all violations that influence the local Qatar market, including violations committed by institutions based outside Qatar. Further, the Competition Law and Executive Regulations apply to all activities (undertaken by factories, institutions, and companies) across all economic sectors (industrial, commercial, agricultural or services) in violation of the same and which influence the Qatar market.

As of today, there are no exact jurisdictional thresholds identified by the Competition Law, the Executive Regulations, or any Committee decisions.

Conclusion

In our guide, we dive more thoroughly into the details of filing, the filing responsibilities, the decision and procedure and other supplementary aspects of the Competition Law. One note that is important to identify is that the Competition Law in the state of Qatar is still subject to several discussions and enhancements in terms of remedies that would be applied, prohibitions and remedies to foreign-to-foreign transactions, contacting third parties and reliance on case law.

Authors:  Yousef Al Amly, Partner, and Rana Moustafa, Associate.

For further information, please contact Alex Saleh (alex.saleh@glaco.com) and Yousef Al Amly (y.alamly@glaco.com).