Tunisia _924-928_ i by chenshu


									924   Tunisia

        Chamber of commerce:
        Tunisian Chamber of Commerce and Industry
        6 rue des Entrepeneurs
        1000 Tunis
        Tel:     +21 67 350 300
        Fax:     +21 67 332 968
        Email: ccitunis@planet.tn

      Overview of the legislation pertaining to merger control

      Sami Kallel
      Kallel & Associates

      The legislation controlling merger activities in Tunisia is Law 91-64 dated July 29 1991
      (as amended on a number of occasions since then) (the Law). The aim of this legislation
      is to ensure that the merger process does not run into competition issues and does not
      alter the market structure.
          The scope of the Law applies to any merger likely to create a dominant position in the
      local market, or a substantial portion of it.
          The Law defines a merger as any transfer of property, or of the use of all or part of the
      property, rights or liabilities of a company, that enables a company or group of companies
      to exert a decisive influence directly or indirectly on one or more companies.

      Notification thresholds
      According to Article 7 of the Law, the companies involved in the merger – whether they are
      parties to the agreement or target companies – must between them meet two criteria to
      satisfy competition requirements:
      • the combined market share of the previous business year must not exceed 30% of
          the sales, purchases or all other transactions on the local market for goods, products
          or substituted services, or on a substantial part of this market; and
      • the combined turnover on the local market does not exceed TD3 million ($2.4 million).
          Should related companies between them meet the above criteria they must then notify
      the minister of trade of the proposed merger.
          Tunisian merger law does not provide for different thresholds relating to financial

      Notification procedure
      Article 8 of the Law requires prior notification of any agreement (or draft of any agree-
      ment) to the minister of trade – at any time if the agreement is still in draft form, or if not,
      within 15 days from the date of signature of the agreement.
         In that respect, the related parties can sign the agreement before filing is made or
      before clearance is obtained, provided they comply with the notification obligation within
      15 days from the signature of the agreement, and they refrain from taking irreversible
         The parties to the agreement must supply the following documents to the Ministry of
      • a copy of the agreement (or draft) and a memorandum on the expected effects of the
         merger or acquisition;
      • a list of the managers or main shareholders of the parties to the agreement and the
         target company;

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•  annual accounts for the three last financial years of all related   Corporate and commercial
   companies, and the market share of each company;
• a list of affiliated companies, with information on capital          Recommended firms
   share, as well as a list of the companies related to them in
                                                                      Abdelly & Associates
   respect of the merger and acquisition process;
• a copy of the statutory auditor’s report, if any; and               Adly Bellagha and Associates
• a report on the merger or acquisition process.
   Pursuant to Article 8, the notification may also include a com-     Ferchiou & Associés Meziou Knani
mitment to attempt to reduce the competition effects of the
merger.                                                               Kallel & Associates
                                                                      Mili & Associates
Time frame
The silence kept by the minister of trade during the three months     Salaheddine Caid Essebsi & Associates
from the notification of the merger implies acceptance of the
agreement (or draft of it) as well as any attached commitments.       Mahbouli & Associates
   During this three-month period, there is no mandatory sus-
pension, but the companies are not allowed to take irreversible       Mallouche & Associés
   The minister of trade, either alone or jointly with the minis-     Abdelly & Associates
ter responsible for the relevant industry sector, may take any
measures necessary to ensure or restore balanced competition          Abdelly & Associates has been operating since 1923, and has
conditions.                                                           a tremendous amount of experience in the practice of cor-
   The minister of trade may also make the success of the merg-       porate and financial law. Name partner Aldine Abdelly is an
er dependent on compliance with certain terms. These terms will       international law expert with more than 40 years’ experience
most usually involve a contribution to economic and social            under his belt – and this is something clients respond to,
progress to compensate for the interference with competition in       with one commenting that “Samir Abdelly is a very dedi-
the market.                                                           cated lawyer, and works in a complimentary manner with
                                                                      clients and other lawyers”.
Referral to the Competition Council                                       The market is of the opinion that Abdelly, Ferchiou and
The minister of trade may also refer the proposed merger to the       Adly Bellagha are the best firms for this type of work in
Competition Council. If so, the minister informs the parties of the   Tunisia; clients remark that the firm “has a very internation-
referral, and the three-month period is increased to six months,      al reach” and “works well with other international law firms
starting from the issue of the acknowledged receipt, provided         in multi-jurisdictional projects.” And Abdelly’s roster of
the filing includes all required elements.                             deals certainly does nothing to cast doubts on that reputa-
   In determining whether the merger contributes to economic          tion. On the banking side the firm worked on a loan for a
and social progress as a balance to the effect on competition, the    private mobile phone company worth $150 million, while
Competition Council takes into account the necessity of consoli-      the corporate practice was busy advising on the 30% priva-
dation or preservation of the local companies competitiveness in      tization of an oil distribution company that involved Irish,
the face of international competition.                                UK, and Italian companies.
                                                                          Among recent projects highlights, the firm has worked
Fines                                                                 on the development of a new Tunisian airport; assisted the
Parties that do not comply with the provisions of the Law are         Tunisian authorities with British Gas in a deal concerning a
fined an amount that could be up to 5% of the pre-tax turnover         Tunisian power plant worth $300 million; worked on a real
in the last accounting period.                                        estate development near Tunis airport; and acted on the
                                                                      restructuring of a joint-venture oil company.
Euro-Med Association Agreement
This section is to briefly introduce the relevant provisions of the    Key contact partner
Euro-Med Association Agreement on merger and acquisitions             Samir Abdelly
between the EU member states and the Tunisian Republic (the
EMAA). By virtue of the EMAA, which came into force on March          Leading lawyer
1 1998, the parties committed themselves to creating a free           Samir Abdelly
trade area between themselves by the year 2010.
                                                                      Adly Bellagha and Associates

                                                                      Adly Bellagha and Associates is a solid top-tier Tunisian firm,
                                                                      with more recommendations from peers and clients than any
                                                                      other firm in the country. The firm’s numbers were boost-

926   Tunisia

      ed in February 2004 with the arrival of Leïla Ben M’Barek,       Leading lawyer
      who came from Hedda Ellouze Law-Firm; M’Barek has                Noureddine Ferchiou
      experience of the full gamut of corporate and commercial
      practice, from finance and capital markets to mergers, acqui-     Kallel & Associates
      sitions and insolvency matters.
          Plaudits from clients were plentiful. Among these, one       Kallel & Associates’ clients range from individual and medi-
      commented that “for the oil and gas industry, Adly Bellagha      um-sized businesses to multinational corporations. The firm
      and Associates comes very well recommended … we are              maintains affiliations and working relationships with law
      very satisfied with his work,” while another states that his      firms in Europe, the Middle East and the US, which enables
      company uses the firm “often and extensively … the firm’s          it to offer a range of both international and domestic advice.
      fees are not cheap, but it is one of the best foreign law firms   Kallel also has long experience of working with Asian
      I use and I have never had anything but great results.”          clients, notably from Hong Kong.
          Many Tunisian firms are, to some extent, one-man-                 The firm is made up of one partner, six associates, one
      shows, so it is not surprising that name partner Adly Bellagha   financial analyst and four paralegals. All of the firm’s lawyers
      also comes in for many compliments from the market. One          are bilingual in French and Arabic, and the firm is the
      client remarked that, having worked with many lawyers            Tunisian representative of the Alliance of Arab Lawyers.
      throughout the world, “Adly is one of the most solid foreign         Kallel & Associates was involved in many of the Tunisian
      lawyers I have dealt with outside the US and the UK,” while      government’s privatizations, including both phases of the
      another echoes this impression, saying he is “an excellent       state’s sale of its cement producer and the privatization of the
      lawyer and a real professional … he has a very good ground-      national energy generator. The firm also worked on the
      ing within the oil business, and has many connections.”          granting of the second GSM mobile phone licence, acting
          The firm has advised an impressive range of clients. On       for the government opposite Abdelly & Associates.
      the finance side these include Crédit Industriel et
      Commercial, Citibank Tunis, Sterling Merchant Finance            Key contact partner
      and Macquarie Bank, while its recent M&A clients have            Sami Kallel
      included United Biscuits UK, Cimpor Cimentos de
      Portugal and Rotary Drilling. The firm also handles some          Leading lawyer
      insolvency work, having worked on receiver appointments          Sami Kallel
      for Sika and Steri, and advised on the loss of more than 50%
      equity for Ets Jabouley.                                         Mili & Associates

      Key contact partner                                              Faouzi Mili, Lotfi Blel and Mohammed Zied Chaabane run
      Adly Bellagha                                                    this “technically very good” firm, supported by a number of
                                                                       young associates. Mili is a considered a leading lawyer in
      Leading lawyer                                                   Tunisia, commended in the legal market for his technical skills.
      Adly Bellagha                                                        The firm is often used as local counsel by financial advi-
                                                                       sory companies PricewaterhouseCoopers and Moore
      Ferchiou & Associés Meziou Knani                                 Stephens, and by Sorenco – the Tunisian subsidiary of
                                                                       French insurance company Coface. Cabinet Mili has work-
      Rounding off the top tier of Tunisian firms is Ferchiou &         ing relationships with several international firms, including
      Associés Meziou Knani, “one of the most regularly used law       NautaDutilh in the Netherlands, Addleshaw Goddard in the
      firms, especially in the oil business,” although the firm “also    UK and French firm Ayache & Salama. It is also the
      does a lot of general business.” It is the largest firm in        Tunisian representative of Cypriot law firm George Yiangou
      Tunisia, with “very good lawyers,” and is headed by name         and Co.
      partner Noureddine Ferchiou, who “has a very good repu-              Mili advised wine trader UCCV on a €5 million ($5.7
      tation” among peers and clients. Indeed, one rival went as       million) contract in December 2002, worked on the sale of
      far to describe Ferchiou & Associés as “the top firm in           Belgian outfit Groupe HIMA’s manufacturing business in
      Tunisia.”                                                        January 2003 and was instructed by French firm Requet
          Recent high-profile work has included the granting of         Chabanel on an industrial client’s establishment in Tunisia in
      mobile telephone licences to Egyptian company Orascom,           April last year. The firm’s partners speak Arabic, French,
      in a deal worth $600 million. Since the licensing, Ferchiou      English and Italian.
      has been advising Orascom on ways to finance its operations
      in Tunisia. Other clients include Merrill Lynch, IBM and         Key contact partner
      Philip Morris.                                                   Faouzi Mili

      Key contact partner                                              Leading lawyer
      Noureddine Ferchiou                                              Faouzi Mili

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                                                                 Tunisia   927

Salaheddine Caid Essebsi & Associates

Name partner Salaheddine Caid Essesbi and his brother Beji
are both frequently recommended by their peers as corpo-
rate finance specialists. Salaheddine in particular was picked
out this year as being “very admired as a lawyer.”
   The firm is also fortunate to have strong political con-
nections – various members of the family have served as the
Tunisian minister of justice. The firm is active in, among
other areas, corporate law, banking, tax, and oil and gas mat-

Key contact partner
Salaheddine Caid Essebsi

Leading lawyers
Beji Caid Essebsi
Salaheddine Caid Essebsi

Other notable firms

Mallouche & Associés is described by the market as “also
very good” although there is some feeling that the firm
“consists of younger lawyers, with perhaps less experience,”
meaning it cannot compete on the same level as the top-tier
trio of Abdelly, Adly Bellagha and Ferchiou. And Mahbouli
& Associates is also beginning to raise its profile in the cor-
porate and financial legal market. This firm focuses on deals
with a southern European element. Slim Mahbouli is
described as “a very promising and professional lawyer.”


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