In a world where each regional competition regulator has distinct merger control triggers and thresholds, assessment frameworks, regulatory powers, policy prerogatives and stakeholders to appease, it may become a case of too many cooks spoiling the broth unless a solution is found. In this edition of Business Law Focus, host Evan Pickworth interviews Lesetja Morapi from Herbert Smith Freehills Kramer on the pressing need for regional competition regulators to co-ordinate and agree a framework that ensures transactions with regional effects do not need to be filed with many regional regulators with overlapping jurisdiction. Join the discussion:The contextThe establishment of regional competition regulators over the past 12 years has largely been a welcome development as, to a large extent, this has streamlined the number of merger filings businesses would otherwise need to submit. However, some of the recent developments may tip the scales towards unnecessary regulatory and transactional complexity for businesses. “It is not hard to imagine a world where transactions involving businesses with revenues or operations in many African countries have to notify and seek the approval of the competition regulators in Comesa [Common Market for Eastern and Southern Africa], Ecowas [Economic Community of West African States], Central African Economic Monetary Community (Cemac), the EAC [East African Community] and AfCFTA [African Continental Free Trade Area], with one or more of these competition regulators having concurrent jurisdiction to approve or block aspects of the same transaction in common countries,” explains Morapi.This is before one considers notifications to regulators in those countries that are either not members of a regional bloc, such as South Africa, Namibia and Botswana, or those who are members of regional blocs but do not recognise their one-stop-shop authority, such as Nigeria and Egypt. “Planning a transactional timeline in these circumstances is a potential minefield. The regulatory timelines of many filings triggered range from a month to more than a year in some cases,” he says.The concerns wouldn’t end there:The merger filing fees can potentially be eye-watering. For example, filing fees in Ecowas are set at 0.1% of the parties’ combined Ecowas revenues or asset values without any caps and can easily trigger filing fees of $1m. Merger parties who file in Ecowas may then potentially also have to pay additional fees to file separately in Nigeria.Though merger parties sometimes take a view on where to file in Africa, they would not lightly do so in Ecowas, where the penalty is about $600,000 a day for implementing a merger without clearance.Where more than one regional regulator has concurrent jurisdiction to approve or block the implementation of the transaction in any particular country, parties may find themselves with conflicting assessments and decisions where, for example, the transaction is approved in Comesa but prohibited in the EAC. The substantive assessments are not always confined to traditional assessments of competition effects but can include broader socioeconomic effects. This can lead to unpredictable outcomes and commitments aimed to remedy socioeconomic issues that are not related to the transaction and increase transaction costs.Morapi says some of these uncertainties can be removed:The most obvious step to reduce uncertainty is for all states that are members of regional treaties to take immediate steps to domesticate those treaties. That would go some way to resolving disputes over whether domestic competition authorities are bound by the one-stop-shop jurisdiction of a regional authority.In addition, the regional blocs should consider concluding binding agreements which incorporate a mechanism through which either businesses or the regional competition regulators can request a referral of the merger review to a single authority if the transaction only has competition effects in that region. For example, parties to a transaction that meets the filing thresholds in AfCFTA and the EAC, but raises only horizontal or vertical effects in the EAC, could be referred to the exclusive jurisdiction of the EAC competition authority. “If these kinds of measures are not taken, it may well be that firms are disincentivised from making much-needed investment in Africa because of the extensive regulatory red tape, expense and uncertainty. All in all, there is an urgent need for competition regulators to collaborate to establish a more cohesive and certain regulatory landscape for businesses looking to invest on the continent,” concludes Morapi.For more episodes go to iono.fm