Features of concluding a purchase and sale agreement for a company in Qatar
This review will be useful to anyone planning an M&A transaction in Qatar. Below, we have outlined the main provisions of the legal framework governing mergers and acquisitions (M&A) in Qatar.
Protection of M&A transactions in Qatar
Any entities entering into a purchase and sale agreement for a company in Qatar must strictly adhere to the non-disclosure provisions set out in the resolution of the Board of Directors of the Qatar Financial Markets Authority. This Regulation introduces strict measures to protect the confidentiality of proposed transactions.
- Prohibits persons with access to data associated with a pending transaction from disclosing that information to third parties unless deemed necessary.
- Obliges persons receiving such information to maintain maximum confidentiality.
Cancellation of a contract for the purchase and sale of a business in Qatar requires the approval of the Qatar Financial Markets Authority. In the event of withdrawal of an offer to participate in an M&A transaction, QFMA has broad powers to carry out all necessary procedures provided for in paragraph 4 of Article 7 of the Regulations.
Stages of concluding an M&A transaction in Qatar
The M&A transaction process in Qatar is structured and involves compliance with regulatory requirements at every stage. Here are the key steps.
- QFMA Notice (two weeks from date of disclosure).
- Submitting the necessary documents to the authorities (no later than 30 days before the general meeting).
- Notification of shareholders (within three days of receipt of QFMA approval and no later than 15 days before the extraordinary general meeting of shareholders).
Compliance with specific timeframes for completing the transaction is mandatory. Initiators of M&A proposals must finalize the process within one month after obtaining approval for the transaction.
There are no specific financing guidelines for public M&A transactions in Qatar. However, parties involved have flexibility to agree on financing arrangements, subject to review and regulatory approval by the QFMA.
Ousting minority shareholders
The regulation sets out the procedure for dealing with minority shareholders in Qatar during an M&A transaction. It requires entities intending to acquire an interest in a public company in Qatar to notify the QFMA. In addition, they are required to submit an offer to acquire the remaining shares from minority shareholders within the prescribed period, ensuring the protection of the rights and interests of minority shareholders.
Although government authorities influence the conclusion of sales contracts in Qatar, interested parties retain the right to participate in M&A transactions. The regulatory framework is designed to provide a structured and compliant environment for such transactions. It is critical to approach M&A transactions with caution, adhere to regulations, and seek expert advice to effectively navigate the regulatory environment.
M&A Transaction Rules Consulting can provide guidance on various steps, specific documentation requirements and regulatory compliance, which will ultimately facilitate successful and legally sound mergers and acquisitions in Qatar.