COMPETITION ISSUES IN MERGERS AND ACQUISITIONS IN NIGERIA AND COMPETITION AND CONSUMER PROTECTION ACT 2019

Onyinye O. C. CHUKWUOCHA

Abstract


Competition is very important ingredient needed for any sector or industry to do well. When there are little or no competitions in any industry, an important ingredient for keeping the sector growing in innovation, and improving in services have been removed. That is why one of the factors that needs to be considered by the regulatory body in charge of Merger and Acquisition, before approving any Merger and Acquisition, is how the Merger and Acquisition affects competition in that sector. Mergers and Acquisition no doubt have become one of the most preferred routes among several external methods of achieving growth in a company.1 Mergers and acquisition is a corporate strategy that could be used to penetrate into new markets, gain management expertise and knowledge2. However, whereas Mergers and acquisition could lead to the emergence of more formidable companies, it has the tendency to kill competition. Merger and Acquisition could be used as an instrument of eliminating competition, and creating monopoly in a sector. If any Merger and Acquisition will erode or remove the much needed competitiveness of that sector significantly, the Competition and Consumer Protection Commission should not approve of the Merger and Acquisition. The matter of Merger and Acquisition has become an issue in the front burner in Nigeria following the massive mergers that characterized the bank consolidation of 2004 and 2005, which brought the matter of mergers and acquisition to limelight in Nigeria. This paper will consider the meaning and importance of Merger and Acquisition, the competition issues in Merger and Acquisition, the role competition plays in bringing a balance in Merger and Acquisition, the exceptions to the law on competition and the new Federal Competition and Consumer Protection Act, 2019 which was passed by President Muhammadu Buhari in 5th February, 2019.

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