UAE Cabinet Announces New Merger Control Filing Thresholds Effective March 2025

UAE Cabinet Announces New Merger Control Filing Thresholds Effective March 2025

The UAE Cabinet has issued Decision No. (3) of 2025, setting out new filing thresholds under the country’s revised merger control regime, which will take effect on 31 March 2025. This decision provides much-anticipated clarity on the new regulatory framework that was introduced in December 2023. Businesses are now awaiting further details, which are expected to emerge through the forthcoming Implementing Regulations or additional legislative guidance.

New Filing Thresholds

Under the updated regime, any transaction classified as an “Economic Concentration”—including mergers, acquisitions, and joint ventures—must be notified to the UAE Ministry of Economy (MoE) at least 90 days prior to completion if either of the following conditions is met:

• The combined sales of the transaction parties in the relevant UAE market exceeded AED 300 million (approximately USD 82 million) in the previous fiscal year.
• The transaction parties collectively hold a market share exceeding 40% of total sales in the relevant UAE market, a threshold carried over from the prior regime.

Per a statement by Dentons, these new thresholds are expected to have a significant impact on companies engaging in mergers and acquisitions within the UAE, requiring businesses to reassess their deal structures and timelines.

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Potential Penalties for Non-Compliance

Failure to notify a transaction that meets the new filing thresholds could lead to severe penalties. Per a statement by Dentons, companies in violation could face fines ranging between 2% and 10% of their annual revenue generated from the relevant goods or services in the UAE. If the specific revenue cannot be determined, fines may range from AED 500,000 to AED 5 million. These penalties highlight the importance of compliance with the new regulatory requirements.

Implications for Businesses

With the implementation date fast approaching, companies operating in the UAE should carefully assess their merger and acquisition activities to determine whether they will need to notify the MoE. If a transaction is likely to meet the new thresholds, businesses should incorporate this requirement into their deal timeline at an early stage. While the framework specifies a 90-day review period, practical experience suggests that additional information requests from the MoE could extend this timeline beyond the initial estimate.

According to a statement by Dentons, the announcement of the filing thresholds marks a positive step towards greater regulatory certainty. However, some key areas of ambiguity remain, including:

• The precise definition of “relevant market” and whether it refers strictly to goods and services directly affected by the transaction.
• The treatment of minority acquisitions under the new regime.
• The inclusion of greenfield and non-full-function joint ventures in the filing requirements.
• The scope of sectoral and other exemptions, especially given the repeal of previous exemptions for certain sectors and government-owned entities.

Source: Dentons