By Sunday Ndamugoba, Partner, RIVE&Co.
The landscape of merger control in East Africa is on the verge of a significant shift. Effective November 2025, the East African Community Competition Authority (EACCA) will formally commence accepting merger notifications, marking a major milestone for regional economic integration. This imminent operationalisation introduces a critical compliance question for multinational corporations and their advisors: What is the current jurisdictional relationship between EACCA and Tanzania’s national competition authorities, specifically the Fair Competition Commission (FCC) and the Zanzibar Fair Competition Commission (ZFCC)?
The current regulatory environment requires a sophisticated, cautious approach. As of today, the legal architecture mandates a dual filing strategy for cross-border mergers, despite expectations for eventual jurisdictional harmonisation. This article analyses the prevailing thresholds, the implications of the regulatory overlap, and the prudent steps counsel should advise clients to take in this interim period.
1. The EACCA’s Regional Mandate and Thresholds
The EACCA is an independent organ of the East African Community (EAC), an intergovernmental body comprising eight partner states (Burundi, Democratic Republic of Congo, Kenya, Rwanda, Somalia, South Sudan, Tanzania, and Uganda). Its core objective is to prevent mergers and acquisitions from creating or strengthening dominant positions that could significantly impede effective competition within the EAC region.
Under the East African Community Competition Act, 2006, a merger with cross-border implications is notifiable to the EACCA if it meets a two-limb test:
| EACCA Notifiable Merger Thresholds |
|---|
| Combined Turnover/Assets: The merging undertakings must have a combined turnover or assets in the EAC, whichever is higher, reaching or exceeding USD 35 million. |
| Minimum Two-Party Threshold: At least two undertakings involved must have a combined turnover or assets of USD 20 million within the EAC. |
| Jurisdictional Waiver: Notification is not required if each merging party achieves at least two-thirds of its aggregate EAC turnover or assets within a single Member State. |
The EACCA’s jurisdiction is focused squarely on transactions that have a regional impact, demanding a review of market effects across multiple partner states.
2. Mainland Tanzania: The FCC’s National Regime
In Mainland Tanzania, the regulatory regime is administered by the Fair Competition Commission (FCC) under the Fair Competition Act, Cap 285 R.E 2023 (the “FCA”). The FCC applies a two-pronged test that must be satisfied for a transaction to be notifiable:
A. The Change of Control Nexus
The FCA defines a merger as an acquisition of shares, a business, or other assets that results in a change of control of a business or its assets in Tanzania.
- FCC’s Interpretation: While “change of control” is not strictly defined in Tanzanian law, the FCC adopts a broad interpretation, considering any situation where a party gains significant or decisive influence over the target’s assets or operations.
- Territorial Link: Crucially, the target must have a presence or nexus in Tanzania. This presence can be established directly or through indirect arrangements, such as distributorship agreements. An offshore transaction with no tangible nexus (e.g., no physical presence or business arrangements) is unlikely to be notifiable, even if the financial threshold is met.
B. The Financial Threshold
A merger is notifiable if the merging parties’ combined annual turnover or asset value (whichever is higher) during the previous financial year is equal to or greater than TZS 3.5 billion.
Analysis of Risk: The FCC assesses this threshold based on the combined worldwide turnover of the parties, making a large number of international transactions technically notifiable. Furthermore, under the 2024 amendments to the FCA, the FCC now has the authority to investigate transactions without any time limitation. Failure to notify a notifiable transaction can result in substantial penalties, including fines of up to 10% of the combined annual turnover of the merging parties.
3. The Dual Filing Dilemma: EACCA and FCC Interface
The core compliance challenge for cross-border mergers involving Tanzania is the current lack of formal legislative coordination between the FCC and the EACCA.
| Jurisdiction Status (As of October 2025) | Compliance Implication |
|---|---|
| Formal Recognition | The FCC has not formally recognized EACCA’s authority over mergers and acquisitions affecting Tanzania. |
| Dual Filing Requirement | Any transaction meeting both the EACCA and FCC thresholds remains legally subject to dual notifications to both authorities. |
| MoU Status | The Memorandum of Understanding (MoU) signed between the EACCA and the FCC on November 1, 2023, currently addresses cooperation but does not specify how merger filings will be handled. |
While there is an anticipation, based on regional practice, that the FCC may eventually cede jurisdiction to the EACCA to avoid regulatory duplication, this is currently not a formal legal position. Amendments to the Tanzanian Competition Act are required to formally recognise EACCA’s primary jurisdiction, and legislative processes can be protracted.
For transactions that are clearly notifiable to both:
- Dual Filings are Prudent: Counsel must advise clients to submit dual notifications to both the FCC and the EACCA to mitigate the significant risk of penalties from the FCC (up to 10% of combined turnover).
- Seek FCC Confirmation: In the interim, clients may seek to obtain an official written response from the FCC, such as a confirmatory letter, asking the Commission to confirm whether a filing with the EACCA alone would suffice. This provides an added layer of compliance comfort.
4. The Complexity of Zanzibar: Interfacing with the ZFCC
The jurisdictional complexity extends to Zanzibar. Competition is not listed as a union matter under the Tanzanian Constitution, meaning the FCC does not exercise jurisdiction over mergers and acquisitions in Zanzibar.
- ZFCC’s Role: The Zanzibar Fair Competition Commission (ZFCC) must separately address and accept EACCA’s jurisdiction.
- Legal Status: At present, there is no known formal step taken by the ZFCC to cede jurisdiction to the EACCA for cross-border transactions extending to Zanzibar.
Without formal acceptance of EACCA’s jurisdiction and corresponding amendments to Zanzibar’s competition laws, any transaction involving a target with a nexus to Zanzibar may also be subject to dual notification to both the ZFCC and the EACCA.
In summary, while the operationalisation of the EACCA is a positive step for regional trade, clients must recognise that the current legal framework mandates a cautious, multi-jurisdictional compliance approach across Tanzania Mainland and Zanzibar to avoid regulatory penalties.
Disclaimer: This article is intended for general information purposes only and does not constitute legal advice. The regulatory framework, including thresholds and procedural requirements, is subject to change. RIVE&Co, and the author, disclaim all liability for any action taken or not taken based on the contents of this publication.
Sunday Ndamugoba Partner, RIVE&Co. Practicing Corporate and Commercial Law.
Contact: sunday@rive.co.tz