GILS Antitrust law: Tajikistan

TAJIKISTAN

1. Is the mandatory merger control regime in force in Tajikistan?

Yes, according to Chapter 4 "State Control over Economic Concentration" of the Law "On Protection of Competition" there is mandatory control over economic concentration in the Republic of Tajikistan; the Antimonopoly Service of Tajikistan in the field of protection of competition is responsible for the following actions. 

The authorised state authority in the field of protection and development of competition carries out state control over the following actions:

• creation, reorganisation (merger, consolidation) of legal entities, business entities and their associations;
• acquisition of shares and shares with voting rights of an economic entity;
• acquisition of shares and shares with voting rights in a business entity;
• acquisition into ownership, use or disposal by one business entity (group of persons) of fixed production assets or intangible assets of another business entity;
• acquisition by a person (group of persons) of rights that allow the business entity to determine the conditions of entrepreneurial activity for that person (group of persons) or to fulfil the functions of its governing body in the territory of the state and abroad.

2. Which authority is responsible for the merger control regime in Tajikistan?

In Tajikistan, the authorised authority implementing the unified state policy in the field of protection and development of competition is the Antimonopoly Service under the Government of the Republic of Tajikistan, which is also responsible for the merger control regime.

3. What is the definition of concentration?

The Law of the Republic of Tajikistan “On Protection of Competition” has the following definition of economic concentration:

Economic concentration is transactions and other actions, including creation and reorganisation (accession, merger, consolidation) of legal entities, transactions related to shares, voting shares and property of legal entities, the right to exercise which affects the state of competition.

4. Is pre-merger filing or post-merger filing required?

If the total book value of the acquirer's assets exceeds two hundred thousand indicators for calculations (for 2024 it is TJS 14 400 000 , in US dollars it is approximately USD 1 360 000), then it is necessary to obtain the preliminary consent of the Antimonopoly Agency for the transaction, i.e. the documents must be submitted prior to the transaction.

And if the total book value of the acquirer's assets exceeds one hundred thousand calculation indicators (for 2024 it is TJS 7 200 000, in US dollars it is approximately USD 679 250), then the Antimonopoly authority must be notified within fifteen days after the transaction, i.e. the documents must be submitted after the transaction.

5. Examples of key concentration types caught by merger control rules in Tajikistan.

The antimonopoly authority conducts state control over the following actions:

• creation, reorganisation (merger, consolidation) of legal entities, business entities and their associations;
• acquisition of shares and shares with voting rights of a business entity;
• acquisition of shares in a business entity;
• acquisition of ownership, use or disposal by one business entity (group of persons) of fixed production assets or intangible assets of another business entity;
• acquisition by a person (group of persons) of rights that allow the business entity to determine the conditions of entrepreneurial activity for that person (group of persons) or to fulfil the functions of its governing body in the territory of the state and abroad. 

6. What are the notification thresholds, which a concentration must trigger for a merger control filing to be required?

The following actions shall be carried out with the prior consent of the state antimonopoly authority:

• acquisition by a person (group of persons) of shares and shares with voting rights in the authorised capital (share capital) of a business entity, as a result of which such person (group of persons) obtains the right to dispose of more than twenty per cent of the acquired shares and shares with voting rights. This requirement does not apply to the founders of a business entity when the entity is formed;
• obtaining of ownership or use by one business entity (group of persons) of fixed production facilities or intangible assets of another business entity, if the book value of the property constituting the subject of the transaction exceeds ten per cent of the book value of fixed production facilities and intangible assets of the business entity alienating the property;
• acquisition by a person (group of persons) of rights enabling the business entity to determine the terms and conditions of entrepreneurial activity for that person (group of persons) or to exercise the functions of its governing body.

Prior consent for the above transactions is required if the total book value of the assets of the persons mentioned above exceeds two hundred thousand calculation indicators (for 2024 this is TJS 14 400 000 somoni, in USD it is approximately USD 1 360 000). 

7. Does the authority have any discretion to review transactions that do not meet the notification thresholds?

Yes, it has the right to inspect such transactions if the consequences of the transaction may have a negative impact on the commodity market. 

8. Do the merger control rules apply to foreign-to-foreign transactions taking place outside Tajikistan?

Yes, it applies, because the Law of the Republic of Tajikistan ‘On Protection of Competition’ also applies to agreements concluded outside the Republic of Tajikistan by individuals and legal entities of the Republic of Tajikistan, foreign persons, individual entrepreneurs, as well as in relation to their actions, if such agreements and actions will or may lead to restriction of competition in commodity markets.

9. Are there specific merger control rules relating to the notification thresholds (e.g., specific merger control notification thresholds for specific sectors; different rules to calculate turnover for specific industry sectors such as banks and insurances or retail, specific rules relating to foreign subsidies, companies, etc.)?

No, the general thresholds are specified in item 4 above. 

10. Whether Tajikistan requires the payment of filing fees and if yes, when?

No, obtaining consent for economic concentration is provided on a free of charge basis.

11. Whether there is a filing deadline in Tajikistan requiring a notification to be filed within a certain period of time following a particular transactional event (e.g., signing a share and purchase agreement)?

No, the Law ‘On Protection of Competition’ does not provide for a deadline for submitting an application for consent to economic concentration. 

The Law ‘On Protection of Competition’ stipulates that the transactions referred to in paragraph 6 above require the prior consent of the Antimonopoly Agency if the total book value of assets of the persons referred to above exceeds two hundred thousand for calculation indicators (for 2024 this is TJS 14 400 000 , in USD it is approximately USD 1 360 000).

12. What information and documents must be disclosed or provided to the authority for the purposes of merger clearance? 

The following documents must be provided to the antimonopoly authority in order to obtain preliminary consent for economic concentration:

On the economic entity whose shares with voting rights are being acquired:

• copy of constituent documents, TIN;
• book value of assets (attach the latest approved balance sheet as of  the date preceding the submission of the application);
• information letter with the following information: main types of activity, volumes of production, sale, import of products and main indicators of economic activity in physical and cost terms, if possible by nomenclature; information about being in the republican or territorial sections of the Register of economic entities occupying a dominant position in the commodity market;

Acquirer of shares with voting rights in the authorised capital of the business entity:

• letter/application for preliminary consent;
• copies of constituent documents and a copy of the registration certificate, TIN;
• extract from the commercial register of the country of origin or other equivalent proof of its legal status in accordance with the legislation of the country of its location (with a certified translation into the state or Russian language);
• if the foreign company has a branch registered in Tajikistan - a certificate of state registration of the branch and a copy of the branch regulations;
• financial report with total assets.

In practice, the Antimonopoly Agency may request additional documents based on the activities of the company whose shares are being acquired and the activities of the acquirer.

13. What are the time periods within which the authority must reach a decision on the merger clearance? Is any fast track or simplified procedures available? 

The final decision by the state antimonopoly authority is made within ten days and the applicant is informed of this in written form.

However, in practice it takes up to 30 days.

14. What are the penalties which the authorities may impose for "failure to file" or "late notification"?

Article 553(1). Failure to submit the relevant petition and application.

2. Failure to submit, in accordance with the procedure established by the legislation of Tajikistan, an application for prior approval of the state antimonopoly authority - shall entail a fine for officials - from one hundred (for 2024, in TJS 7 200, and in USD it is approximately USD 680) to one hundred twenty (in TJS 8 640, and in USD it is approximately USD 816). For legal entities - from five hundred (in TJS 36 000, and in US dollars it is approximately USD 3 397) to eight hundred (in TJS 57 600, and in US dollars it is approximately USD 5 434) calculation indicators. 

15. Have there been any recent developments regarding the merger control regime in Tajikistan?

Since the adoption of the Law of the Republic of Tajikistan ‘On Protection of Competition’ (i.e. since 2017), there have been no changes to the merger control regime.

Author: Kamoliddin Mukhamedov, Bahodur Nurov