Work highlight / 11 Aug 2025

Obtaining clearance under the UAE’s new merger control thresholds

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Gateley Middle East

The Gateley Middle East team recently advised the founder of a prominent digital agency operating in the UAE on a strategic sale of their business to a global digital marketing agency.

The transaction triggered a pre-transaction notification clearance requirement from the UAE Ministry of Economy (MOE) pursuant to the new merger control turnover threshold, introduced with effect from 31 March 2025 through Cabinet Resolution No. (3) of 2025 pursuant to the Federal Decree-Law No. 36 of 2023 (the UAE Competition Law). Under this new threshold, if the annual sales of the parties in the economic concentration, in the relevant market in the UAE, during the last fiscal year exceed AED 300 million (approximately USD 81.7 million), a pre-transaction notification for competition clearance should be made to the MOE at least 90 days prior to completion of the transaction and approval must be sought (the UAE Turnover Threshold).

Access our previously published article here on “Navigating the new UAE merger control thresholds”.

The MOE’s introduction of the UAE Turnover Threshold aligns the country’s merger control regime with international best practices and ensures greater oversight of high-revenue transactions, even when those deals don’t involve a large market share.

The criteria set out in the UAE Competition Law in respect of what type of transaction qualifies as an “economic concentration”, the pre-transaction notification for competition clearance requirement in respect of the “market share” threshold (being the combined market share of the parties involved exceeding 40% in the relevant market in the UAE during the last fiscal year) and the general prohibition on abuse of dominance in the UAE market, continue to apply.   

Challenges

  • The transaction triggered the mandatory pre-transaction notification for competition clearance in the Kingdom of Saudi Arabia, which was obtained around 90 days after submission and shortly after 31 March 2025 (the date on which the UAE Turnover Threshold was implemented in the UAE).
  • After analysis, it was verified by the parties and the advisers that the annual sales of the parties involved in the economic concentration, in the relevant market in the UAE, during the last fiscal year, exceeded the UAE Turnover Threshold and therefore mandatory pre-transaction notification for competition clearance needed to be made to the MOE.
  • As the UAE Turnover Threshold had just been implemented in the UAE, this transaction was going to be among the first - if not the very first - to be captured by the new rules.
  • The sale and purchase agreement (SPA) was amended to capture the unconditional MOE competition clearance as a condition precedent to completion (giving rise to negotiation around responsibility, fee payment and the risk around any conditions attaching to MOE clearance). 

Approach

Gateley Middle East, in collaboration with the buyer’s legal advisers:

  • Assisted with identifying that the transaction was captured by the UAE Turnover Threshold;
  • Negotiated the amendments to the SPA;
  • Prepared the MOE application form (in Arabic) in line with the MOE guidance for the mandatory pre-transaction notification for competition clearance and submitted to the MOE legal team dealing with such applications; 
  • Engaged proactively with the MOE, addressing all queries and responding to all requisitions and requests raised by the MOE in respect of the application;
  • Submitted all supporting documentation requested by the MOE (and in the guidance attached to the application form); and
  • Obtained clearance from the MOE in respect of the transaction. 

Outcome

  • Successful clearance from the MOE was obtained without conditions within the MOE’s prescribed timeframe.
  • The transaction was cleared for completion.
  • Our client achieved regulatory compliance thereby avoiding any risks and penalties related to antitrust enforcement.
  • The case strengthened our firm’s expertise in advising on complex competition filings in fast-evolving digital sectors.

FAQs

We set out below FAQs and answers in relation to the MOE UAE Turnover Threshold application and requirements. The answers are based on this case study and its facts and timing and remain subject to change pending any new guidance, rules and practices implemented by the MOE. 

What information did the MOE UAE Turnover Threshold application request?

The application form used was the same form which applies to the 40% market concentration MOE application form (and may therefore change in the future). The form requested information in relation to:

  • relevant parties and their group entities in the UAE (and licence activities); 
  • type of economic concentration;
  • goods or services subject to concentration; 
  • relevant market and market volume; 
  • buyer sales values and percentage of sales volume; 
  • buyer services/ goods;
  • positive and negative impacts of concentration and proposed mitigation measures;
  • sales values and competitor information relating to the target;
  • key target client information; 
  • key factors affecting price formation for transaction; 
  • factors affecting price stability over the past 5 years;
  • target intellectual property information;
  • markets affected by the economic concentration; 
  • details of any economic concentration during the past 5 years in relation to the target.

Where do you get the form from?

The form must be requested from the MOE (either through email or in person).

What supporting documentation did you provide with the MOE application?

The application was supported by:

  • the memorandum of association and/ or articles of association and active licence/registration of each entity involved in the concentration process (including buyer and target group entities in the UAE) (translated into Arabic and legalised and attested for use in the UAE, if applicable);
  • redacted sale and purchase agreement; 
  • shareholder register relating to the seller, target and buyer;
  • attested financial statements for each of the buyer and the target for the last 2 financial years (the UAE-based target financial statements were required to be attested by the Chamber of Commerce in the UAE and in the case of the foreign buyer, the statements needed to be translated into Arabic and legalised and attested for use in the UAE);
  • powers of attorney, where relevant, if the application is made by an attorney (translated into Arabic and legalised and attested for use in the UAE, if applicable); and
  • reports and studies in respect of the market, the market concentration and potential effects of the transaction.

Did the MOE request any hard copy documentation?

Yes, the MOE requested hard copies of the legalised and attested articles of association, power of attorney and financial statements of the foreign buyer to be delivered of the MOE. 

Did the MOE provide confirmation of acceptance of application once all information and documentation was submitted?

Yes, once all the MOE enquiries and information requests were dealt with and the MOE accepted the application, the MOE provided a written confirmation of acceptance of application by way of email. 

Did you include seller sales turnover in the UAE Turnover Threshold calculation?

In this case we did, however, we understand from MOE verbal guidance that if the selling party is not continuing in a position of control following completion of a transaction, the annual sales of the selling party should not form part of the calculation of the annual sales of the parties involved in the economic concentration, in the relevant market in the UAE, during the last fiscal year. This may be subject to change.

Was the application publicly advertised prior to approval?

No. We specifically requested that the application not be advertised due to the confidential nature of the transaction and the MOE confirmed that public advertisement would not apply. The transaction is not currently appearing on the UAE public register of transactions which are subject to competition clearance approval.

How long did the MOA approval take to obtain?

90 calendar days (but this could be shorter depending on the circumstances). 

Was there a fee applicable to the approval/ notification?

This transaction did not attract a notification/approval fee, however, we understand that a fee, based on a percentage of the transaction value, may be introduced. 

Once the application was submitted, did the MOE raise questions?

Yes, the MOE requested confirmation and clarification on the application form information (specifically around sales volumes) and requested that any documentation relating to the non-UAE buyer be translated into Arabic, legalised and attested for use in the UAE. 

In what form did the MOE approval take?

The approval came through by email from a member of the MOE legal team dealing with the application. This may change in the future. 

Were there any conditions attached to the MOE approval?

In this case, no, however, we understand that the MOE will impose conditions to approvals, where necessary. 

Who pays for the application related costs and disbursements?

This is a commercial point to be agreed between the parties.

Are there any exemptions to the UAE Turnover Threshold criteria?

We look forward to the Implementing Regulations shedding light on various unresolved issues, such as sectoral exemptions (which were removed under the new UAE Competition Law indicating that exemptions will only apply where a specific sector is already governed by its own competition framework), treatment of joint ventures and minority disposals and those applicable to state-owned entities. Furthermore, clearer guidance on defining market boundaries is expected to come from upcoming rulings or official statements by the MOE, which have not yet been made public.

What happens on failure to apply for a reportable competition clearance?

Companies that fail to notify a reportable transaction may face fines ranging from 2% to 10% of their annual UAE revenues for the relevant product or service from the previous fiscal year. For anti-competitive conduct, fines start at AED 100,000, with a maximum of 10% of total annual UAE sales or AED 5,000,000 if sales cannot be determined. Where it is impossible to calculate revenues, fines will range between AED 500,000 and AED 5,000,000.

Final thoughts

Whilst the UAE’s competition law framework has become more robust, its practical enforcement and interpretation are still developing. Key aspects, such as sector-specific exemptions and the treatment of state-owned entities remain unclear, but further guidance is expected in the forthcoming Implementing Regulations. Definitions of “relevant markets” and “control” within the Economic Concentration context are also likely to evolve through future decisions or formal guidance from the MOE, which have yet to be made public.

Positive indications from the MOE reflect an intention to streamline the transaction approval process, ensuring that the enforcement of the UAE Competition Law’s mandate to preserve and enhance competitive markets is harmonised with fostering the economic advantages of an active mergers and acquisitions environment.

Why choose us?

Our hands-on experience of navigating the UAE’s competition regime ensures that your M&A transactions meet regulatory requirements efficiently, minimising risks and delays while maximising commercial value. Contact us to find out how we can support your next strategic transaction in the UAE.
 

Disclaimer

This insight is intended as a general case study and does not constitute legal advice. The information provided is subject to change and may not reflect the most current legal developments. For tailored guidance on UAE merger control thresholds or related matters, please contact a member of the Gateley Middle East M&A team.