The subsidiary holding companies would not be required to obtain pre-merger clearance from the Competition Commission of Pakistan (CCP) for mergers, amalgamation and ventures with other subsidiaries of the same company. The CCP has considerably relaxed rules and regulations for pre-mergers of subsidiary companies within the holding company to facilitate the corporate sector.
The Commission on Tuesday proposed amendment in the Competition (Merger Control) Regulations, 2007 to simplify rules for the holding companies. Official sources told Business Recorder that if one subsidiary merges into another subsidiary within the holding company, there would be no requirement to obtain pre-merger clearance from the CCP.
In other words, the CCP has further increased the threshold for mergers where subsidiaries were seeking pre-merger clearance. The subsidiary companies would not be required to seek pre-merger clearance from the CCP. Previously, these holding companies were required to come to the Commission for obtaining permissions before mergers of their subsidiaries. Now, the CCP has granted another concession to these companies.
According to the draft amendments in the Competition (Merger Control) Regulations, 2007, the amendments have been proposed for the information of all undertakings and individual persons, and the notice is hereby given that the comments on the proposed amendment, if any, be communicated to this Commission within 30 days of its publication.
Any suggestion which may be received from any undertaking or other person in respect of the proposed amendment before the expiry of the said period shall be considered by the CCP.
COMPETITION (MERGER CONTROL) REGULATIONS, 2007, IN THE ABOVE REGULATIONS: (1) in regulation 4A, in sub-regulation (1), the words "acquire or" shall be inserted before the word "increase"; and (2) in regulation 4A, after sub-regulation (1) a new sub-regulation (1A) shall be inserted, namely: "(1A) a transaction in which a holding company (whether incorporated in or outside Pakistan) merges, amalgamates, combines or ventures jointly with its subsidiary or the subsidiaries thereof (whether incorporated in or outside Pakistan) merge, amalgamate, combine or venture jointly with each other."
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