Corporate M&A 2026 Comparisons

Uganda’s M&A landscape has been shaped by an interplay of legal, economic, political and social factors. As the country moves beyond the 2026 general elections, political dynamics are expected to exert a significant influence on transactional activity, creating ripple effects across various sectors. The above notwithstanding, in the past 12 months, Uganda has experienced significant growth in M&A activity across different sectors, including technology (particularly fintech), financial services, insurance, healthcare, manufacturing, and oil and gas.

By way of example, there has been an uptick of investment in the communications space; for instance, CANAL+ and MultiChoice Group announced a Mandatory Takeover Offer by CANAL+ for the shares of MultiChoice Group, including GOtv Uganda, pending regulatory approval from the Uganda Communications Commission. With regard to financial services, ABSA Bank completed the acquisition of Standard Chartered Bank’s wealth and retail banking portfolio. There have also been noteworthy tax reforms, including the removal of stamp duty on most agreements, enhanced incentives for private equity and venture capital funds regulated by the Capital Markets Authority (CMA), stricter tax identification and gaming payment gateway requirements.

In 2025, regulatory and policy developments continued to shape transaction structuring, valuation and due diligence across sectors. The National Climate Change (Climate Change Mechanisms) Regulations 2025 formalised Uganda’s carbon market framework, positioning carbon credits as a regulated asset class and introducing compliance obligations that now feature in transactions involving forestry, agriculture and energy projects.

The launch of the National Biofuels Blending Programme in July 2025, mandating 5% ethanol blending and licensing four blending facilities at key border points, has strengthened the investment case for ethanol producers, agricultural supply chains and fuel distribution businesses. At the same time, the Electricity Regulatory Authority temporarily suspended new solar and wind licences from 24 October 2025 pending a grid stability study, shifting investor focus towards hybrid and base-load technologies such as geothermal, hydro and nuclear. Biomass and geothermal development continues under the revised REFIT framework, with geothermal potential estimated at 1,500 MW, while fiscal incentives for clean cooking solutions are supporting growth in sustainable energy investments.

The Bank of Uganda’s October 2025 guidelines on domestic financial holding company structures introduced clearer requirements on capital, governance and group-wide supervision, requiring acquirers to assess regulatory capital, shared services and cross-border oversight in group transactions. The August 2025 National Payment Systems Oversight Policy Framework further strengthened risk-based supervision of banks, payment service providers and fintechs, increasing compliance considerations in financial sector deals.

In capital markets, the Capital Markets Authority (Corporate Governance) Regulations 2025 imposed mandatory governance standards on listed companies and intermediaries, while the Uganda Securities Exchange (USE) advanced sustainability reporting initiatives aligned with international ESG standards, raising disclosure and integration expectations in acquisitions. In addition, the USE introduced significant amendments to its Listing Rules, Fees, Charges and Penalties Rules, and Trading Rules 2021, all of which took effect on 25 February 2025. The amendments strengthen regulatory oversight, enhance market transparency and impose stricter compliance requirements on issuers and trading participants.

Competition enforcement has also become more structured following the gazettement of the Competition Regulations 2025, which introduced merger notification thresholds, filing fees and a 120-day review timeline, alongside an expanded definition of control. Regionally, the Common Market for Eastern and Southern Africa (COMESA) Competition and Consumer Protection Regulations 2025 established a suspensory merger regime, clarified notification thresholds including for digital markets and greenfield joint ventures, and strengthened the public interest test, making regional clearance a central consideration in cross-border transactions.

Tax amendments in 2025, including the removal of stamp duty on most agreements and enhanced incentives for private equity and venture capital funds regulated by the CMA, have improved deal efficiency, while stricter tax identification and gaming payment gateway requirements, together with ongoing beneficial ownership disclosure obligations, have reinforced compliance and transparency as core elements of transaction planning and due diligence.

The industries in Uganda that experienced significant M&A activity in the past 12 months include banking, finance, agribusiness, communications and insurance. In the banking sector, local banks have pursued consolidation to strengthen capital adequacy and enhance operational efficiencies, such as ABSA Bank’s completed acquisition of Standard Chartered Bank’s wealth and retail banking portfolio. Similarly, the communications industry has witnessed major M&A activity. CANAL+ and MultiChoice Group announced a mandatory takeover offer by CANAL+ for the shares of MultiChoice Group, including GOtv Uganda, pending regulatory approval from the Uganda Communications Commission. The insurance sector has also seen increased deal activity, including Sanlam Allianz Africa (Proprietary) Limited taking security by way of share pledge over shares in Sanlam Allianz General Insurance (Uganda) Limited from NICO Holdings Plc, reflecting ongoing consolidation and regional restructuring within the industry.

In Uganda, the predominant means of acquisition of a private company is by way of a share purchase, which involves the transfer of the shares of existing shareholders and/or subscription for new shares. Companies may also be acquired through an asset purchase or through an amalgamation, which entails the unification of two or more companies to form one in accordance with the provisions of the Companies Act, Cap 106 (“the Companies Act”). A company that intends to amalgamate must authorise an amalgamation proposal, which must detail the terms of the amalgamation.

In relation to publicly listed companies, shares can be acquired through the relevant securities exchange, a private placement or a takeover (mandatory or otherwise). The Capital Markets (Takeovers and Mergers) Regulations 2012 (“the Takeovers and Mergers Regulations”) stipulate threshold requirements that trigger the application of the takeover procedure. This arises in instances where a person that makes an offer to acquire voting rights of a listed company:

• holds more than 15% but less than 50% of the voting rights of a listed company and acquires in any one year more than 5% of the voting rights of such a company;
• holds 50% or more of the voting rights of a listed company and acquires additional voting rights in the listed company;
• acquires a company that holds effective control in the listed company or together with the voting rights already held by an associated person or related company, resulting in acquiring effective control; or
• acquires any shareholding of 20% or more in a subsidiary of a listed company that has contributed 50% or more of the average annual turnover in the latest three financial years of the listed company preceding the acquisition.

The relevant notifications and approvals to and from the CMA must be sought for the transaction to proceed, and the necessary corporate and sector regulatory approvals, if required, must be obtained in order to consummate the transaction.

The primary regulators of M&A activity in Uganda are:

• the Ministry of Trade, Industry and Cooperatives (“the Ministry”), which is responsible for overseeing mergers, joint ventures, acquisitions and antitrust matters under the framework of the Competition Act, Cap 66 (“the Competition Act”);

• the CMA, which regulates M&A activity concerning companies listed on the USE and their subsidiaries, including entities licensed by it such as brokers, fund managers, securities exchanges and dealers;
• the USE, which is the primary platform for listing and trading companies in Uganda’s stock market. The USE falls under the regulatory purview of the CMA and serves as the principal marketplace where companies can raise capital through debt and equity issuances. The USE is a demutualised exchange and is self-regulating;
• ALTX Uganda, which is licensed by the CMA and serves as a complementary trading platform to the USE, particularly for retail investors, institutional traders and high-frequency trading participants. In order to list on either market segment, companies must meet the listing requirements set out in the ALTX Securities Rules v2.0, Book 1 and Book 3;
• the COMESA Competition and Consumer Commission, which regulates M&A transactions with a regional dimension. A transaction is deemed to be of a regional dimension in circumstances where either or both of the parties to a proposed transaction operate in two or more member states; and
• the East African Competition Commission (EACC), which regulates M&A transactions that have a cross-border effect within the EAC common market. This means that the transaction must impact competition in more than one EAC member state. The EACC has extraterritorial jurisdiction over activities that occur outside the EAC if those activities have an impact on competition within the EAC common market.

There are specific sector-related rules that apply to M&A transactions. The Financial Institutions Act, Cap 57, has provisions which govern the amalgamations and arrangements for the transfer of all of the assets and liabilities of a financial institution to another person. The Uganda Communications Act, Cap 103, regulates the acquisition of entities, mergers and takeovers in the telecommunications sector. The Petroleum Supply Act, Cap 163, requires that the prior approval of the Commissioner for Petroleum be obtained before any transfer of a permit or licence in a regulated company. This would apply in cases where the structure of the M&A transaction culminates in a transfer of a permit or licence. The Insurance Act, Cap 191, governs the amalgamation and transfer of insurance business. These laws require the approval and/or notification of the relevant sector regulator in respect to the proposed M&A transaction in the industry. The oil and gas laws, particularly in the midstream and upstream sectors, also stipulate local content requirements that may apply to an acquirer.

Under the Financial Institutions (Ownership and Control) Regulations, no individual or corporate entity, with the exception of licensed financial institutions, the Government of Uganda, foreign governments, state-owned enterprises, foreign financial institutions licensed in their respective jurisdictions and non-operating holding companies approved by the Bank of Uganda, may own more than 49% of the share capital in a Ugandan financial institution.

In the oil and gas industry, the Petroleum (Exploration, Development and Production) (National Content) Regulations require a licensee, its contractors and its subcontractors to give preference to Ugandan goods and services, and in the event that such goods and services are not available in Uganda, that the same be provided by a joint venture company with a maximum of 52% foreign participating interest and at least 48% Ugandan participating interest.

Under the Land Act, Cap 236, foreigners are restricted from owning land under the freehold and mailo land tenure systems. Instead, they can only acquire land through leasehold tenure, typically for a maximum period of 99 years.

The antitrust regulations that apply to business combinations in Uganda are the following:

• The Competition Act introduces a suspensory regime, and establishes the Competition and Consumer Commission and an overall structured framework for the oversight of mergers, acquisitions and joint ventures.
• The Competition Regulations 2025 operationalise Uganda’s competition law framework, prohibit anti-competitive agreements and abuse of dominance, empower the Ministry to investigate complaints, and introduce mandatory merger notification thresholds based on turnover, assets, sector and COMESA nexus.
• Merger transactions with a regional dimension are also notifiable to COMESA, and are thus subject to the COMESA Competition and Consumer Protection Regulations 2025 and the COMESA Competition and Consumer Protection Rules 2025. To trigger COMESA notification, a transaction must qualify as a merger under COMESA regulations and, crucially, satisfy the regional dimension test, and exceed the financial thresholds established by COMESA for mandatory notification.
• However, the Competition Act does not explicitly define the jurisdictional relationship between the technical committee on competition established in the Ministry and other independent regulators responsible for overseeing competition within their respective sectors. These regulators include the Uganda Communications Commission, the Bank of Uganda, the Electricity Regulatory Authority, the Insurance Regulatory Authority, the CMA and the Petroleum Authority. Additionally, certain government ministries, such as the Ministry of Energy, play a role in regulating competition in the downstream petroleum and mining subsectors. However, it remains unclear whether a transaction approved by a sector regulator after assessing its competition impact would require further approval from the technical committee on competition. It is also uncertain whether the committee has the authority to modify or override a decision made by a sector regulator.

There are numerous laws which regulate employment-related matters in Uganda.

These laws include the following:

• the Constitution of the Republic of Uganda, 1995;
• the Employment Act, Cap 226;
• the Uganda Citizenship and Immigration Control Act, Cap 313;
• the Occupational Safety and Health Act, Cap 231;
• the Labour Disputes (Arbitration and Settlement) Act, Cap 227;
• the Workers Compensation Act, Cap 233;
• the Labour Unions Act, Cap 228;
• the National Social Security Fund Act, Cap 230;
• the Petroleum (Exploration and Development and Production) Act, Cap 161;
• the Petroleum (Refining, Conversion, Transmission and Midstream Storage) Act, Cap 162;
• the Employment Regulations, 2011; and
• the Protocol on the Establishment of the East African Community Common Market.

From a Ugandan perspective, in addition to these mandatory laws, employment relationships are primarily contractual in nature. As such, acquirers must adhere to the existing contractual obligations with the target company’s employees. Upon the transfer of a business from the target to the acquirer, the contracts of service of all employees shall automatically be transferred to the acquirer on the same terms and obligations. A purchaser of a listed company must state its intention with regard to the continued employment of employees in the takeover document.

There is no national security review of acquisitions in Uganda.

The CMA issued the Capital Markets Authority (Corporate Governance) Regulations 2025. These Regulations set out mandatory governance standards for listed companies and licensed capital markets intermediaries. They cover board composition and independence, functioning audit, risk and remuneration committees, defined roles and responsibilities, robust risk management and internal controls, timely disclosure and reporting, active shareholder engagement and performance-linked remuneration. Companies must maintain ongoing compliance, which is monitored and enforceable by the CMA.

In October 2025, the Bank of Uganda issued guidelines on domestic Financial Holding Company structures, defining a Financial Holding Company as a Ugandan-incorporated holding entity with at least 25% shareholding in one or more supervised financial institutions. The guidelines restrict such companies to equity holding activities, permit provision of shared services only with prior approval, require minimum paid-up capital invested in liquid assets, and provide for cross-border supervisory co-operation where foreign subsidiaries are involved.

In August 2025, the Bank also issued the National Payment Systems Oversight Policy Framework, which supplements the National Payment Systems Act, Cap 59, by introducing detailed supervisory and operational standards and classifying payment systems and participants according to systemic importance and risk. For questionnaire purposes, these instruments require confirmation of group-wide regulatory compliance, capital adequacy, governance and risk management at holding company level, as well as compliance with licensing, security, interoperability and reporting obligations for any banking, fintech or payment system operations.

In order to support wider adoption of sustainability reporting, the USE announced in 2025 that it is developing a national guidance framework for listed companies, working with the Institute of Certified Public Accountants of Uganda to prepare for implementation of IFRS Sustainability Disclosure Standards, and expanding capacity-building under the USE Academy to help both listed and private institutions strengthen ESG disclosures. The guidelines focus on key ESG metrics such as carbon footprint, energy efficiency, waste management and governance practices, with the aim of attracting more sustainable investment into Uganda’s capital markets.

The Electricity Regulatory Authority suspended the licensing of solar and wind projects with effect from 24 October 2025 until the conclusion of a grid stability study to determine future integration thresholds for variable renewable energy, reportedly affecting about USD230 million in planned investments across Uganda. During this period, only hybrid projects (eg, solar with battery storage) are to be considered until the ban is lifted. While this presents a challenge for developers, it also creates an opportunity for undertakings to capitalise on innovative technologies that enhance system flexibility and long-term project viability.

The Stamp Duty (Amendment) Act 2025, Cap 339, removed stamp duty payable on any agreement or memorandum of an agreement except a sale-based financing agreement between the vendor or borrower and a person licensed to carry on Islamic financial business.

Under the Tax Procedures Code (Amendment) Act 2025, Cap 343, for tax purposes, the registration number issued by the Uganda Registration Services Bureau, in the case a non-individual, shall now be used as the non-individual’s Tax Identification Number. In the alternative, the company shall use a tax identification number issued by a foreign tax authority with which Uganda has a tax treaty or agreement for the exchange of information. The Act also prohibits a local authority, government institution or regulatory body from issuing a licence or any form of authorisation necessary for purposes of conducting any business in Uganda to any person without either of these.

The Tax Procedures Code (Amendment) Act 2025 also makes it mandatory for casino, gaming and betting operators to process all wagers and payouts through a centralised payments gateway licensed by the Bank of Uganda and linked to the Uganda Revenue Authority electronic notice system, thereby increasing regulatory oversight and compliance obligations. Non-integration attracts a penal tax of double the gaming or withholding tax due or UGX110 million, whichever is higher, significantly heightening operational and transactional risk, particularly in the context of due diligence and acquisitions in the sector.

The Income Tax (Amendment) Act 2024, Cap 338, introduced new tax amendments that are likely to have an impact on M&A activity in Uganda. One key development is the tax exemption for income derived by private equity and venture capital funds regulated by the CMA.

The income of individuals and entities meeting specific investment criteria is exempt from income tax. Investors that, within a period of ten years from the commencement of business or from making additional capital investment, invest at least USD10 million (for foreign investors) or USD300,000 (for Ugandan citizens operating in urban areas) or USD150,000 (for Ugandan citizens operating in upcountry areas) qualify for tax exemptions. However, such investors must meet the following conditions:

• at least 70% of their raw materials must be locally sourced, subject to availability;
• at least 70% of their employees must be Ugandan citizens, earning an aggregate wage of at least 70% of the total wage bill; and
• they must be engaged in the manufacture of electric vehicles, electric batteries or electric vehicle charging equipment; the fabrication of electric vehicle frames and bodies; or the operation of specialised hospital facilities.

Furthermore, income derived by private equity and venture capital funds regulated by the CMA is now exempt from income tax. The prior provision that granted non-recognition of capital gains tax on the sale of investment interests in a registered venture capital fund, as long as at least 50% of the sale proceeds were reinvested within the year of income, has been repealed. This means that venture capital funds are no longer required to reinvest at least 50% of the proceeds of the sale of their interest in Uganda for them not to be charged with capital gains tax.

There is also a noteworthy amendment concerning stamp duty under the Stamp Duty Act, Cap 339: investors acquiring shares in a private equity or venture capital fund, or private equity or venture capital funds regulated by the CMA, are not required to pay stamp duty on nominal share capital or any increase of share capital, or a transfer of shares or other securities, to or by them.

There have not been any significant changes to the takeover law in the past 12 months, nor is it under review.

Under Ugandan law, there are no prohibitions and/or restrictions imposed on stakebuilding prior to making a takeover bid. Bidders are entitled to, and often do, build stakes in the target prior to launching an offer; however, it is not a requirement. A bidder may elect to build a stake in the target prior to launching an offer as a demonstration of commitment to the target and a means of increasing the acquirer’s leverage during pricing negotiations. Until a potential bidder breaches the 25% shareholder level of the target, other than for certain disclosure obligations, stakebuilding is unregulated.

Under both the Companies Act and USE Listing Rules of 2025, there are material disclosure requirements and filing obligations. A company is obligated to file an annual return at the end of each calendar year.

Under the Listing Rules, major shareholders of any class of voting securities must disclose any significant changes in their ownership over the past three years. Similarly, issuers for the Fixed Income Securities Market Segment must disclose any changes in the ownership percentage of major shareholders during the same period.

Stakebuilding is not common in Uganda, and therefore we are not in a position to contemplate any hurdles to stakebuilding.

There are no restrictions imposed on transactions involving derivatives. Derivatives are also known as secondary securities whose value is solely based on the value of the primary security that they are linked to, called the underlying. Typically, derivatives are considered advanced investing. Unlike in similar jurisdictions, where derivatives are often traded on exchanges, there is no dedicated derivatives exchange in the country. Consequently, derivatives transactions occur over the counter (OTC). However, investors need to be aware of the risks with OTC markets since the transactions do not have a central marketplace nor the same level of regulatory oversight as those transactions done via regulated exchanges.

There are no filing and/or reporting obligations for derivatives under securities disclosure and competition law.

In private companies, there are no rules or regulations on what information must be made available to a buyer. Usually, information is made available to a potential buyer during the due diligence process. On the other hand, in listed companies, the Takeovers and Mergers Regulations obligate the acquirer to disclose in the offer document all such information as the target and its shareholders would require. The disclosure shall state: the identity of the ultimate bidder; names of the directors and shareholders and the extent of their interest in the bidder; long-term commercial justifications for the proposed takeover offer; and intentions regarding the continuation of the business of the target.

The Takeovers and Mergers Regulations provide for offences and penalties in the event that the information disclosed is false or misleading. There is also a provision for a purchaser that discovers that information disclosed was false or misleading or contained a material omission to disclose the fact to the CMA and issue a press notice rectifying the false or misleading information.

In private companies, there are no requirements to disclose a deal. As such, M&A transactions in private companies tend to be confidential.

For listed companies, the Takeovers and Mergers Regulations stipulate that a purchaser that intends or proposes to acquire effective control in a listed company shall make a public announcement through a press notice and serve a notice of intention of the scheme on the target within 24 hours of making a decision to acquire effective control in a company or from the passing of a resolution of its board approving the transfer. The notice of intention must also be officially served on the target company at its registered office.

Furthermore, copies of this notice must be simultaneously delivered to the CMA and the USE. It is imperative to note that where there has been a press notice of an intention to make a takeover offer, the bidder is prohibited from withdrawing the takeover offer without the prior written consent of the CMA.

There is no specific stage at which a target is required to disclose a deal.

Market practice on timing of disclosure does not differ from legal requirements.

In Uganda, due diligence exercises will usually cover legal, commercial, financial and tax issues. The scope of the due diligence exercise will differ from one transaction to the other and could also depend on whether the transaction is structured as a share or asset deal.

In order to minimise legal risk, lawyers carry out due diligence on the merging companies, advise on the regulatory requirements applicable to the proposed transaction, review transaction documentation to ensure compliance with local law (in the event that the documentation is originated out of jurisdiction), and provide legal opinions on the enforceability of transaction documents, material contracts and litigation.

In Uganda, standstill agreements are not commonly used in transactions. Instead, it is more typical for a prospective acquirer to seek an exclusivity arrangement, which is often a point of negotiation between the parties. The target company, however, will usually aim to restrict the duration of this exclusivity to ensure that negotiations are not unnecessarily prolonged.

It is permissible under Ugandan laws for tender offer terms and conditions to be documented in definitive terms.

In the context of M&A transactions between private companies, there is no specified timeline under the law, and the parties may agree on the length of the merger or acquisition. The timeline will generally depend on the transaction structure, and the parties tend to typically agree to the transaction timetable.

For transactions involving publicly listed companies, the acquirer will have to factor the statutory and regulatory steps and timelines to execute the transaction into its timetable. Some of the factors that could impact the timeline for a transaction include internal approvals, regulatory filings and approvals, financing arrangements, the preparedness of the seller for due diligence and the complexity of the transaction.

For mandatory takeovers, there are prescribed timelines within which each required step must be completed. Some of the times are as follows:

• the acquirer is required to announce its proposed offer within 24 hours from the resolution of its board to acquire effective control in the target;
• the acquirer must serve on the target within ten days from the date of the notice of intention, the acquirer’s statement of the takeover scheme;
• upon receipt of the acquirer’s statement, the target is required to inform the relevant stock exchange and the CMA of this receipt and make an announcement by press notice of the proposed takeover offer within 24 hours after receipt of the statement;

• the acquirer shall, within 14 days from the date of service of the acquirer’s statement, submit the takeover offer document in relation to the takeover offer to the CMA for approval;
• the CMA shall make a decision on the offer document within 30 days;
• following the approval by the CMA, the acquirer is required to serve the target with the takeover document within five days from its date of approval;
• upon receipt of the approved takeover document, the target is mandated to circulate the takeover document and the independent adviser’s circular to its shareholders within 14 days from receipt of the approved takeover document;
• the takeover document shall remain open for acceptance by the target for 30 days from the date of service of the takeover document by the acquirer; and
• the takeover offer shall be deemed to close on the last day of the offer period.

On acceptance of the takeover offer, the acquirer shall notify the Ministry of the takeover. The Ministry shall, within 120 days, inquire into the takeover with the view to determining whether the takeover is likely to cause an adverse effect on competition within the market.

Under the Takeovers and Mergers Regulations, persons shall be required to make a mandatory offer under the following circumstances:

• where a person holds more than 15% but less than 50% of the voting rights of a listed company and acquires in any one year more than 5% of the voting rights of such company;
• where a person holds 50% or more of the voting rights of a listed company and acquires additional voting rights in the listed company;
• where a person acquires a company that holds effective control in the listed company or together with the voting rights already held by an associated person or related company, resulting in acquiring effective control; or
• where a person acquires any shareholding of 20% or more in a subsidiary of a listed company that has contributed 50% or more to the average annual turnover in the latest three financial years of the listed company preceding the acquisition.

The consideration in most M&A transactions is either cash or a mixture of cash and shares. In respect of an amalgamation, the consideration is shares in a newly incorporated entity.

In relation to an M&A transaction in listed companies, there are special rules which apply if the consideration is cash in whole or in part. The takeover document must state the period within which the payment will be made and the method of payment, in addition to a confirmation obtained from the purchaser’s financial adviser indicating sufficient funds to carry out the takeover offer in full. Further, the purchaser is obligated to deposit in an escrow account 10% of the total consideration payable as a security for the performance of its obligations. The escrow account takes the form of either a cash deposit in a commercial bank or a bank guarantee in favour of the target that is payable on demand.

In Uganda, the terms of a takeover offer are typically outlined in a contractual agreement between the contemplated parties to the transaction. Common conditions often include securing necessary corporate approvals and obtaining regulatory clearance. In the case of public M&A transactions, the acquirer must specify the conditions under which the shares will be acquired, along with other relevant details.

There are no statutorily prescribed minimum acceptance conditions under Ugandan law.

In private companies, parties to an M&A transaction are at liberty to agree to any financial arrangement.

For public M&A transactions, the Takeovers and Mergers Regulations require the acquirer to deposit 10% of the total consideration in an escrow account as security for fulfilling its obligations. This ensures the acquirer’s financial capacity to complete the takeover. Additionally, the full purchase consideration must be deposited in a designated account with a commercial bank within 21 days.

Additionally, although regulators generally do not block deals solely because they are conditional on financing, but they require that all conditions be lawful and not anti-competitive.

The Takeovers and Mergers Regulations do not restrict the implementation of measures to ensure the safety of a deal. However, such measures must be disclosed in the takeover document and the notice of intention.

The Takeovers and Mergers Regulations do not restrict the implementation of measures to ensure the safety of shareholder agreements. Particularly in private equity transactions or situations where the buyer does not seek full ownership, buyers often negotiate governance rights. These may include the attainment of board representation and veto powers over certain decisions, including the entrenchment of founder member rights. For public M&A transactions, the CMA Corporate Governance Guidelines mandate the fair treatment of all shareholders, including minority and foreign investors.

Under the Companies Act, a shareholder is entitled to appoint a proxy to attend a meeting on behalf of the shareholder, speak and even vote. Such shareholder must give notice of the appointment of the proxy before the meeting is held, and the proxy need not be a member.

In Uganda, when a takeover leads to the acquirer acquiring at least 90% of the voting rights in the target company, a squeeze-out mechanism is triggered. Under this framework, the acquirer is required to extend an offer to the remaining minority shareholders, providing them with compensation equivalent to either the prevailing market price of the voting rights or the price offered to other shareholders, whichever is higher. This mechanism presents an exit opportunity for minority shareholders.

There are no restrictions imposed on bidders from obtaining irrevocable commitments from principal shareholders of the target company. The commitments will be subject to negotiations and agreements before a formal offer is made to the target company.

The timing and method of making a takeover bid public differ significantly between private and public companies.

For private companies in Uganda, the Companies Act does not prescribe public disclosure requirements. However, if the proposed acquisition triggers competition sector-related approvals, notification to the specific sector regulator is mandatory. In contrast, for companies listed on the USE, there are ongoing disclosure requirements which must be met by way of releasing an announcement by press notice of the proposed takeover offer within 24 hours, and formal notifications must be initiated and issued to the CMA, the USE and the board of the target.

Under the USE Listing Rules of 2025, an issuer is obligated to announce significant events as soon as possible and no later than 24 hours after they occur. The Listing Rules define significant events to include any changes in substantial shareholdings, acquisitions of shares that lead to a company becoming a subsidiary or associated company, sales of shares that result in a company no longer being a subsidiary, and any sale of assets that amounts to 10% or more of the issuer’s net assets, and the announcement must include the information necessary to enable holders of the issuer’s listed securities and the public to avoid the creation of a false market in its listed securities.

The Companies Act imposes a requirement to disclose the details of any shares or debentures held by directors, as well as any rights they have to acquire such securities, if these holdings are affected by the transaction. This includes shares held in the company, its subsidiaries, its holding companies, or subsidiaries of its holding companies.

The Takeovers and Mergers Regulations generally require all persons concerned with acquisitions, takeovers and mergers to make full and prompt disclosure of all relevant information and take every precaution to avoid the creation or continuance of an uninformed market. During a takeover offer period, the acquirer is not allowed to sell any voting rights related to the offer.

There is no requirement to disclose the financial statements of the acquirer to the shareholders of the target. However, in terms of the Takeovers and Mergers Regulations, a summary of audited financial statements – in particular, balance sheet, income statement, statement of changes in equity, cash flow statement, and basic and diluted earnings per share – must be included in the acquirer’s statement of intention. According to the Accountants Act, Cap 294, financial statements must be prepared in accordance with internationally accepted accounting standards, such as IFRS and/or GAAP.

It is important to disclose transaction documents in full to regulatory bodies in the process of obtaining requisite transaction approvals or waivers.

Under Ugandan law, directors have extensive common law and statutory duties that apply in the performance of their duties, including during a business combination. The principal duties of a director are the following:

• to act in a manner that promotes the success of the business of the company;
• to exercise a degree of skill and care as a reasonable person would do when looking after his or her own business;
• to act in good faith in the interests of the company as a whole;
• to declare any conflicts of interest;
• not to make personal profits at the expense of the company; and
• not to accept benefits from third parties that will compromise him or her.

In terms of the Companies Act, directors have a duty to resolve, following the assessment of the amalgamation proposal, that the amalgamation is in the best interests of the shareholders and that the company will be solvent immediately after the amalgamation, and sign a certificate to that effect.

Generally speaking, director duties are owed to the company. However, there is now a widely accepted view that there is an interconnection between the company and other stakeholders in its ecosystem, such as employees, suppliers and creditors. As such, these duties can be construed widely to apply to the other stakeholders of the company.

The Capital Markets Authority (Corporate Governance) Regulations 2025 mandate that listed companies establish key board committees, including nomination, audit and remuneration committees, to enhance transparency and corporate governance. However, the Regulations do not impose any restrictions on the formation of additional committees. Boards of directors have the discretion to establish special or ad hoc committees when dealing with complex transactions such as business combinations or situations involving conflicts of interest.

From a Ugandan perspective, there are no established precedents dealing with the application of the business judgement rule in takeover scenarios. Generally, courts will uphold a decision of the board provided that there is no evidence of a breach of duty, fraud or negligence.

Under the Takeovers and Mergers Regulations, the board of directors is obligated to appoint an independent adviser on receipt of the acquirer’s statement. The independent adviser appointed must be an investment adviser, broker or dealer. The form of independent outside advice will focus on the commercial, tax and legal structure of the transaction. It is also common practice for advisers to liaise with the regulatory authorities to procure the requisite approvals from the CMA and USE to consummate the transaction.

Conflicts of interest are scrutinised in Uganda.

In terms of the Ugandan company legislation, directors are required to avoid conflicts of interest in whatever form. A director is prohibited from making personal profits at the expense of the company or obtaining benefits that will compromise him or her while managing the company’s affairs. Additionally, any director who has a direct or indirect interest in a transaction or proposed transaction with the company is required to promptly disclose the nature of their interest in writing to the board.

The CMA Corporate Governance Guidelines recommend the following:

• directors should monitor and manage potential conflicts of interest at management, board and shareholder levels;
• there should be a formal and transparent procedure for the appointment of directors to the board, and such persons availing themselves for appointment must disclose any potential areas of conflict that may undermine their position or service as directors; and
• a director should immediately declare any conflicts of interest arising from his or her position on the board.

According to the Capital Markets Authority (Conduct of Business) Regulations 2025, advisers are prohibited from rendering advice on transactions where they have a material interest or where, on account of a past relationship, a conflict of interest has arisen. Furthermore, advisers are obligated to have measures in place to ensure that their employees and/or agents do not solicit inducements that are likely to conflict with any duties owed to their clients.

Companies are generally expected to adopt a policy on related-party transactions and disclose all such transactions in their financial statements.

The Takeovers and Mergers Regulations make no distinction between friendly and hostile takeovers. Hostile tender offers are not common in Uganda.

The use of defence by directors is not regulated under Ugandan law. However, directors may adopt commonly used defensive strategies from other jurisdictions, provided they act within the limits of their fiduciary duties and in the best interests of the company. Any defensive action taken must be justifiable and aligned with both their statutory duty and common law duties to promote the success of the company.

There are no examples of a transaction in Uganda where common defensive measures have been implemented.

The duties set out in the Companies Act remain in effect throughout a director’s tenure. However, in the context of a takeover bid, the most significant obligations include the following:

• Acting within their authority: Directors must exercise their powers strictly within the limits set by the company’s constitution and for their intended purpose. Even if directors believe they are acting in the company’s best interests, using these powers for any other reason is not permitted.
• Avoiding conflicts of interest: Directors must take care to avoid situations where they have, or could have, a direct or indirect interest that conflicts, or may conflict, with the company’s interests.
• Promoting the company’s success: Directors have a duty to act in a manner that furthers the company’s growth and long-term value. While the meaning of “success” may vary depending on the circumstances, it is ultimately determined by the directors’ good faith judgement.

Directors cannot “just say no” to a business combination, as their fiduciary duty requires them to act in the best interests of the company. Their decisions must be well reasoned and consider not only the company’s success but also the interests of its employees, shareholders and broader stakeholders. This assessment is based on an objective test rather than a subjective one, ensuring that directors act with proper justification rather than personal discretion.

Disputes in M&A transactions in Uganda are rarely resolved through litigation. Definitive agreements for private M&A deals typically include clauses specifying arbitration as the preferred dispute resolution mechanism. Additionally, in cross-border M&A transactions, parties frequently opt for a foreign jurisdiction as the governing law, with either English law or New York law being most commonly chosen.

Please refer to 10.1 Frequency of Litigation.

Please refer to 10.1 Frequency of Litigation.

Shareholder activism is a growing trend in Uganda, allowing investors to actively engage in shaping the policies and practices of the companies they invest in. The CMA Corporate Governance Guidelines encourage a constructive approach to shareholder activism, emphasising the importance of equitable treatment for all shareholders, including minority and foreign investors. Boards of directors are responsible for upholding this principle, fostering open dialogue and active participation between companies and their shareholders. In some cases, shareholders are represented as an interest group on the board and are typically awarded a board seat. An example of shareholder activism is seen in companies where the National Society Security Fund, a provident fund that covers all employees in the private sector, has acquired an equity stake. In such companies, it common for the Fund to acquire a board seat.

There are no examples of transactions which have been aborted due to shareholder activism.

The focus of activists has been on corporate governance, management changes and company strategy. There is also increasing interest in ESG-related concerns. The Bank of Uganda has launched an ESG framework for the banking industry to guide financial institutions in adopting sustainability practices, thereby supporting the country’s broader sustainable development goals.

It is not common for activists to seek to interfere with the completion of announced transactions in Uganda.