Parliament has officially passed the Treasury Laws Amendment (Mergers and Acquisitions Reform) Bill 2024, leaving the Australian Competition & Consumer Commission (ACCC) focused on successful implementation of the new merger regime, ready for once it commences in 2026.
The ACCC first released proposed merger reforms at the Law Council in 2021. In a submission to the Senate Select Committee on Supermarket Prices in March 2024, the ACCC once again recommended reform of current merger laws, alongside the introduction of an unfair trading practices prohibition and making the Food and Grocery Code of Conduct mandatory. The government announced it would be undertaking merger reform in April.
The bill was introduced to Parliament in October, aiming to provide fit for purpose tools targeted at identifying and preventing anti-competitive mergers for the ACCC. The new merger regime will come into effect from 1 January 2026, but will also allow for merger parties to start using the new regime on a voluntary basis from 1 July 2025.
Currently Australia's merger regime does not require merger parties to notify the ACCC of proposed acquisitions or to wait for ACCC clearance before proceeding with the acquisition.
Under the new process, all transactions above a prescribed threshold must be notified to the ACCC.
In addition to moving to a mandatory notification system, the new merger laws will:
- Provide the ACCC with the tools to better deal with ‘serial acquisitions’ where a number of smaller transactions occur over time that cumulatively end up causing serious harm to competition.
- Provide for greater transparency for business and the broader community on all mergers considered by the ACCC, including by requiring the ACCC to publish reasons for all final merger decisions.
- Create a more efficient and faster process particularly for non-contentious mergers and more certain timelines for businesses seeking approval.
- Allow the Treasurer to designate certain high risk sectors and impose specific notification thresholds for those sectors.
- Adopt a risk-based approach using enhanced economic and data analysis in the ACCC’s administrative decision making.
ACCC chair, Gina Cass-Gottlieb, said the organisation recognises that this will be an adjustment for the business community and the ACCC, marking the most significant change to Australia’s merger regime since the Trade Practices Act was enacted 50 years ago.
“We have consistently outlined why the changes are necessary to achieve effective merger control in Australia and ensure there is strong competition across our economy, driving dynamism, productivity and restraint on prices for the benefit of consumers and business,” said Cass-Gottlieb.
“We are also acutely aware that successful implementation will be crucial to the overall success of the new regime. Therefore we are working very hard to carry out this important preparation work which we have outlined in the recently released Statement of Goals.
“As part of this, we will be working and consulting with businesses and other stakeholders to ensure parties have clarity on timeframes and processes, and that the new regime achieves its intended benefits of increased efficiency and transparency.”
According to the ACCC timeline, public consultations on draft process guidelines, draft analytical guidelines, and notification forms will be held in Q1 2025, and guidelines will be published in Q2, including engagement with merger parties and stakeholders on what to expect in the lead up to mandatory notification commencing.
Mandatory participation in the new regime will commence in 2026, followed by a review of the notification thresholds after one year. A review of the formal regime will be conducted three years after commencement, informed by evidence around the impact of mergers on the economy and the performance of the ACCC.
“As we celebrate these important reforms becoming law, we also are mindful of the importance of supporting a smooth transition as the new regime is bedded down,” said Cass-Gottlieb.
“We will work closely with key stakeholders and will issue draft guidelines for consultation in early 2025 to assist businesses and stakeholders adapt to the new merger regime.”
