As Comesa tightens merger rules, dealmaking learns to live with delay
The cost of a merger is no longer settled at signing when the longest stretch comes after everyone agrees
Deal teams across Eastern and Southern Africa have learned to read the order of documents. Term sheets first, then diligence, then filings. The Comesa merger notification rules have rearranged that stack. Approval now sits closer to the opening page, no longer an administrative footnote handled after signatures are exchanged.
The effect is not dramatic in a single moment. It accumulates. Calendars stretch. Financing assumptions soften. Internal approvals take longer because nobody wants to explain why a closing date slid by a quarter.
Thresholds that look tidy until you apply them
On paper, the numbers appear manageable. A $60 million combined turnover or asset base draws a cross-border merger or joint venture into mandatory notification. Digital marketplace transactions face a $250 million threshold, calculated globally rather than within the region.
Once applied, the simplicity fades. Corporate groups with layered holding companies find themselves debating which balance sheet carries authority. Revenue booked offshore but earned locally complicates the arithmetic. Advisers report recalculations that land on different answers depending on timing and exchange rates. None of this stops a deal outright, but it drains momentum.
Time as a regulatory cost
The suspensory regime makes one rule plain. A transaction cannot be implemented before clearance from the Comesa Competition and Consumer Commission. The commission has up to 120 days to issue a decision, with room to extend when scrutiny deepens.
Four months can feel abstract until market conditions move. Interest rates change. Currencies slide. Vendors grow impatient. Buyers hedge with clauses that reopen pricing if approvals take too long. These are rational responses, yet they pull negotiations into defensive postures earlier than before.
The numbers everyone now memorises
What hardens the process is not scope or sequencing, but exposure. Contraventions can attract fines of up to 10 percent of audited annual turnover, payable within 45 days. If payment slips, penalties accrue at 2 percent per day until settled. These figures circulate early in internal discussions now, sometimes before valuation models are finalised, because they define the downside before upside is even debated.
Fees that alter who hesitates
Filing fees have climbed. Parties now pay 0.1 percent of the higher of combined Comesa-area turnover or assets, capped at $300,000. Digital transactions face 0.05 percent, with the same cap.
Large multinationals absorb this as friction. Mid-sized firms pause. Some reassess whether regional expansion through acquisition still makes sense at this scale, or whether organic growth, slower and less certain, carries fewer immediate costs.
Digital platforms caught by distance
The global basis for digital thresholds pulls in transactions with limited local footprints. A platform may have modest activity within Comesa states yet still trigger notification because of worldwide turnover. This extends regional oversight into boardrooms far from Lusaka.
The logic follows current competition thinking, even if the regulations avoid theory. Scale matters. Network effects matter. The tension lies in capacity. As more global deals enter the queue, the commission’s workload thickens, and waiting times become harder to predict.
Overlap without full alignment
Comesa is not alone. The East African Community Competition Authority now requires notification for transactions worth at least $35 million when business is intended in more than one EAC member state. Exemptions exist, but they rely on internal revenue splits that are not always easy to prove.
There is a memorandum of understanding between the two bodies, aimed at coordination and information sharing. Practitioners still prepare for parallel filings. Redundancy feels safer than omission when penalties are steep and guidance evolves through practice rather than precedent.
A stretch of process that goes on
Much of the current adjustment happens in small rooms rather than public announcements. Lawyers debate definitions late into calls. Finance teams assemble numbers that were never meant to be aligned this way. Regulators request clarifications that prompt further clarification. None of it is controversial. It is simply slow, and that slowness becomes part of the price of doing business across borders, particularly for firms without dedicated regulatory units.
Where pressure may surface next
As filings increase, prioritisation becomes unavoidable. Deals with clear regional impact may move faster than those that look peripheral. That creates incentives. Parties may emphasise local relevance in their submissions, or delay filing until structures appear simpler. At the same time, EAC timelines run on a different clock, and coordination remains voluntary.
The rules are in force. Practice is still forming. The open question is operational rather than philosophical. How will two regional authorities, each with growing mandates, manage volume without turning time itself into the main barrier to cross-border deals?
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