SIGNAL
In West African private equity and infrastructure, the difference between a successful exit and a total loss often rests on the fine print of the OHADA Uniform Act. With over $400 billion in infrastructure projects planned for the 2026-2027 cycle, the legal architecture of deals has become the primary determinant of risk premiums. Mastering the technical nuances of the law is not an administrative task; it is a fiduciary obligation.
INSTITUTIONAL CONTEXT
OHADA’s 17 member states benefit from a unified legal framework designed to guarantee judicial security. The primary instrument is the Uniform Act on Commercial Companies (AUSCGIE). Since the landmark 2014 revision introducing the Société par Actions Simplifiée (SAS), shareholders have access to contractual flexibility previously unavailable in the region. The 2023 Uniform Act on Enforcement (AUPVE) modernized debt recovery and asset seizure protocols, providing foreign investors with more robust tools to secure capital.
THREE KEY CLAUSES
- The Deadlock Clause (Texas Shoot-out): shareholder paralysis is a primary cause of joint venture failure. Within an SAS, ‘Buy-Sell’ provisions force resolution: one party offers to buy the other’s shares at a set price; the other must then either sell at that price or buy the initiator’s shares at the same price. This prevents long-term asset freezing without judicial dissolution. 2. The Shareholder Exclusion Clause (Articles 853-19 and 853-20): these articles allow the exclusion of a shareholder under conditions stipulated in the bylaws, enabling the removal of a non-compliant partner without triggering a dissolution claim. 3. Valuation Precision (Article 853-21): this article allows bylaws to define valuation methodologies in advance, mitigating the risk of a court-appointed expert inflating or deflating the exit value.
THE THRESHOLD PERSPECTIVE
In the OHADA zone, legal due diligence is a strategic tool. The 2014 and 2023 reforms offer a sophisticated toolkit to de-risk investments, but only if applied with precision. By referencing Articles 853-19, 853-20, and 853-21 specifically, and ensuring the Article 2-1 mirroring between the Shareholders’ Agreement and the Bylaws is complete, investors can ensure their capital remains mobile. In West Africa, a well-drafted legal structure is the best operational defense.