The new ACCC merger regime: a round-up of recent announcements

Recent days have seen a series of much-anticipated announcements about the implementation of Australia’s new mandatory and suspensory merger control regime, which commences on a voluntary basis from 1 July 2025 and comes into force on 1 January 2026. The Australian Competition and Consumer Commission (ACCC) has released three sets of guidelines (draft guidelines on analytical and process matters and transitional guidance) and Treasury has released a draft legislative determination providing detail on matters including the calculation of filing thresholds and notification forms and document requirements.

The information drop came in the same week – and, in the case of the Treasury guidance, the same morning – as an Australian federal election was called, sending Government into ‘caretaker’ mode. For transaction parties and advisors, it is unlikely that any further detail or revised guidance will be issued until very shortly before the new regime commences.

Key takeaways

• Uncertainties persist: There remain information gaps and an absence of meaningful guidance on important elements of the regime, including the opaque notification waiver mechanism, merits review process, interaction with Australia’s foreign investment regime and access to confidential third-party evidence.

• Limited clarity on the ACCC’s wide discretions: The ACCC retains considerable latitude to manage review timeframes and target transactions using unconventional theories of harm, but there is limited guidance on when and how it proposes to exercise its discretions – creating significant uncertainty for transaction parties.

• Protracted pre-notification will mask true review timeframes: While the ACCC promises high phase 1 clearance rates within 15-20 business days, the extended duration and anticipated intensity of pre-notification discussions (which can extend to sharing draft notifications, discussing document requests, or canvassing potential remedies), will result in a significant discrepancy between review times in practice and on paper. This will only be exacerbated for reviews requiring any form of international coordination.

• Proactive strategic planning for the transition is critical: The window to obtain clearances under the current regime is closing fast and transaction parties face critical choices – they must urgently consider whether to pursue the current informal review process for impending deals, weighing the risks of being required to re-file under the new regime if clearance cannot be obtained by year-end with the demanding requirements of the new regime. For transactions cleared informally before July that may not complete before year-end, parties must seek an ‘updated informal view’ to trigger a 12-month grace period in which to complete.

• Expect practical complexity in applying notification thresholds: The introduction of multi-layered definitions for determining corporate groups for turnover calculation purposes will make it difficult to determine which of a party’s related entities (both upstream and downstream) should be included when calculating turnover, creating particular difficulties for funds with broad portfolios and presenting a material non-compliance risk. The lack of clear guidance for determining a target’s ‘market value’ (as distinct from transaction consideration), particularly in the context of private capital transactions, underscores the need for further clarification to avoid unnecessary pre-notification discussions or waiver applications simply to ascertain notifiability.

• Onerous information requirements threaten workability: The long-form filing, which will need to be used in a wide range of circumstances, requires up-front production of a large volume of documents to the ACCC (including documents unrelated to the proposed transaction from the previous three years that discuss competitive or market conditions, market shares, competitors, or business plans in relation to the relevant products or services).

• Mandatory filing designations for supermarkets and limited exemptions for property transactions: As expected, a designation is proposed to mandate notification of almost all acquisitions by Woolworths and Coles, including land acquisitions above a certain size. The focus on supermarkets is unsurprising given the ACCC’s recent conclusions about major supermarkets’ market power and the background of a ‘cost of living’ election. Further designations requiring mandatory notifications will likely follow, including potentially ‘big tech’ transactions. The scope of a designated exception for property transactions has been usefully expanded to include extensions or renewals of leases over land on which commercial businesses are currently operated.

• Implementation frictions: The guidance and determination do little to assuage concerns about the ACCC’s ability to manage the enormous challenges of implementing a complex new regime with a substantially increased caseload. At least during the implementation phase, transaction parties should plan on the ACCC utilising the discretions available to it under the new regime (including protracted pre-notification discussions and ‘clock-stoppers’) to extend overall review timelines well beyond the statutory limits.

The new mandatory ACCC review process

The ACCC’s draft process guidance, together with the draft determination published by Treasury, provide some further clarity on the notification process. However, in many respects the guidance lacks sufficient detail to provide certainty on both the circumstances in which notification may be required and the information that will need to be provided as part of the new ACCC process.

To recap the basics, the new regime will require mandatory and suspensory notification to the ACCC of any acquisitions of interests in shares or assets exceeding the specified monetary thresholds or that otherwise fall within a specific designation. Only acquisitions of controlling interests in shares are caught, where ‘control’ is defined consistently with the definition in the Corporations Act 2001 (Cth) (Corporations Act), meaning the capacity to determine the financial and operational policies of an entity. In relation to acquisitions of shares in publicly listed companies or unlisted but widely held companies, acquisitions of interests less than 20% are exempt and an acquirer is deemed to have control at a 20% threshold. There are exceptions for internal restructures, acquisitions in the ordinary course of business, and share acquisitions in public or widely held companies over the control threshold.

1. Notification thresholds

The notification thresholds for the new regime set out in the draft determination are broadly consistent with previous announcements. The monetary thresholds are set out in detail in Table 1 below.

The determination introduces several new definitions and concepts, often drawing from Australian corporations and tax law, to seek to clarify the calculation of the thresholds. Most significantly:

• Broad control assessment: For the purposes of applying the notification thresholds, the turnover allocation rules use a broad concept of control by incorporating definitions of ‘control’ and ‘associated entity’ from the Corporations Act that encompass entities in which an acquirer has a partial interest but negative control (unhelpfully, it is proposed that this control definition will be broader than that used to determine if a share acquisition is required to be notified). This approach is inconsistent with the rules in other major jurisdictions and a range of regular acquirers (such as PE sponsors) will need to adjust the basis on which they calculate their groups’ turnover to comply with these new rules. For targets, the calculation is limited to the turnover of target entities.

• Australian GST turnover: Used in applying the thresholds, ‘Australian GST Turnover’ is a concept adopted from Australian Goods and Services Tax laws and refers to the value of a party’s taxable and GST-free supplies in Australia. This may be reasonably easy for many entities to identify, because businesses are already required to report the value of their taxable and GST free supplies in their Business Activity Statements lodged with the Australian Taxation Office.

• Australian nexus: A transaction is only notifiable if it is ‘connected with Australia’. This arises where a target (but not other entities in its corporate group) carries on, or intends to carry on, business in Australia (‘carrying on business in Australia’ is itself a well-established term in Australian law that applies a low threshold). Without further clarification, this broad definition may capture foreign-to-foreign transactions where there are no current overlaps and no competitive impact in Australia.

• Transaction value uncertainty: The global transaction value threshold is assessed by reference to the higher of the consideration paid for the shares or assets being acquired or their market value. The unnecessary alternative assessment of transaction value and lack of guidance on appropriate methodologies for determining market value creates significant uncertainty, particularly in private transactions.

• Supermarkets: Reflecting the ACCC’s concerns about supermarket industry concentration, including in its recent Supermarkets Inquiry Final Report, Coles and Woolworths are specifically required to notify all acquisitions of supermarket businesses and acquisitions of interests in land above specific size thresholds. Despite the Treasurer’s indications, digital platforms, retail fuel, liquor and radiation oncology providers do not currently have specific notification threshold requirements, but the use of the designation power to require wider notifications is likely to expand over time.

• Exemptions: As expected, exemptions are proposed for land acquisitions for the purpose of developing residential premises and acquisitions by businesses primarily engaged in buying, selling or leasing land, where the acquisition is for a purpose other than to operate a commercial business on the land. Extensions and renewals of leases over land on which a commercial business is currently being operated are also exempt, along with acquisitions by administrators, receivers and liquidators, and acquisitions related to certain fundraising activities (e.g. rights issues and buy-backs).

• Anti-avoidance: There are anti-avoidance provisions, the effect of which is to disregard the effects of any scheme if it would be reasonable to conclude that the purpose of any person(s) engaged in the scheme is to avoid notification. The anti-avoidance provisions appear to be designed to prevent structuring solutions to avoid notification obligations.

2. Notification process

• Obligation and approach: The obligation to notify the ACCC of a notifiable acquisition rests with the acquirer(s), with notifications to be submitted via a ‘mergers portal’ and subject to yet-to-be-announced fees. Details of notified acquisitions, including the parties and a short non-confidential transaction description, will be published on an ‘Acquisitions Register’ within one business day of the effective notification date (i.e. the date notification is made and the fee is paid). Notices of Competition Concerns and ACCC determinations may also be published, but not notifications or submissions.

• Below-threshold acquisitions: The ACCC retains the ability to investigate and prosecute non-notified acquisitions that it considers likely to substantially lessen competition (SLC). Parties can voluntarily notify below-threshold acquisitions or those with threshold uncertainty to mitigate that risk. The ACCC is collaborating with Treasury on guidance on the interaction between the new merger regime and Foreign Investment Review Board (FIRB) reviews, but it appears likely that FIRB will be able to refer below-threshold acquisitions to the ACCC.

• Waivers: Businesses can apply for a notification waiver if an acquisition appears unlikely to meet thresholds or does not raise competition risks requiring further investigation. Waiver applications will not be determined before 10 business days from the date on which they are published on the ACCC’s Acquisitions Register, allowing third parties to raise concerns. The ACCC anticipates most waiver decisions will be issued within 20 business days, which is the upper bound of the 15-20-day timeframe in which it expects to complete 80% of reviews. Otherwise, no detail about the waiver process has yet been provided, including how much information is required in a waiver request. Accordingly, further guidance is required if this is to be a useful mechanism to save transaction parties the burden of notification fees, forms and documentary requirements for low-risk transactions. It does not seem likely that notification waiver applications will be able to be made before 1 January 2026, which is likely to create a logjam and lead to delays in obtaining waivers in the first quarter of 2026.

• Forms: The determination includes short and long notification forms. The ACCC’s preliminary view is that transaction parties should use the long form in the following circumstances:
  
  
  • Horizontal acquisitions: The transaction parties supply products and services in the same market and their estimated combined market share post-acquisition is at least: 40%, with an increment of at least 2%; or at least 20%, with an increment of at least 5%.
    
    
  • Vertical acquisitions: A transaction party supplies products or services in a market that is upstream or downstream from a market in which another transaction party supplies products or services and one of the parties has a market share of at least 30% in their respective market , with the other having a market share of at least 5% in the upstream or downstream market.
    
    
  • Conglomerate: The transaction parties supply adjacent or related products or services, and one of the parties has a market share of at least 30%. The ACCC indicates that products or services will be considered adjacent where they are not in the same market or supply chain, but are related in some way, such as targeting similar customers or they may be purchased or supplied together.
    
    The ACCC has also suggested that parties “should consider” using the long form in other, less empirical circumstances, including transactions involving vigorous and effective competitors, targets that are developing a “significant product” in a market where both parties are active or potentially active, or firms that supply or control access to a significant input or asset (e.g. raw materials, infrastructure, intellectual property, a significant user base), or where the acquirer would receive access to competitively significant data. The short form is said to be reserved for all other transactions.
    
    In calculating market shares for the purposes of both determining the appropriate form to use and completing either form, the ACCC expects parties to adopt market definitions that give rise to the largest combined market share or increment) based on the turnover, volumes or capacities of the parties to the transaction. While the ACCC does not contemplate applying a concept similar to the ‘narrowest plausible’ market definition, it does recognise that transaction parties do not need to accept that these are the most relevant or appropriate market definitions or shares for assessing the competitive effects of the transaction.
    
    Both forms require details on transaction parties, a non-confidential summary of the acquisition, a list of the acquisitions the parties made in the previous three years (above $2 million), and information on competitive effects (market definitions, estimated market shares, and key competitors, suppliers and customers). The long form demands much more extensive information, including on any existing or proposed commercial relationships between the parties, detailed market share data, barriers to entry, as well as responses to targeted questions relating to horizontal, vertical and conglomerate acquisitions, as applicable to the acquisition.
    
    Substantial document requirements are also foreshadowed for acquisitions utilising the long form, which include all transaction documents (including information memoranda, post-acquisition business plans and financial forecasts) and board documents in the last three years (not limited to documents prepared in the context of the acquisition, but extending to those that report on market conditions, competitors or business plans concerning any products or services relevant to the acquisition). Notifying parties are also required to identify the documents that they consider, or a reasonable objective third party would consider, to most comprehensively support the responses in their notification. A summary of the information and documents required under each form is included in Table 2 below.
    

3. Review timeframes

• Pre-notification expectations: The draft process guidelines strongly recommend that businesses engage in comprehensive pre-notification discussions with the ACCC in advance of formal notification for all but the simplest transactions, to ensure that notifications are relevant and complete. This is intended to mitigate the risk of the ACCC subsequently finding a notification to be ‘materially incomplete’ or not accepting a notification in the first place. The ACCC advises initiating contact at least two weeks prior to formal notification, with significantly earlier engagement recommended for transactions involving concentrated markets, assessment by overseas competition agencies, or potentially warranting a remedy. The ACCC indicates that pre-notification engagement on more complex transactions may involve submitting a draft notification for discussion or more detailed discussions about information requirements and potential areas of focus. Consistent with experience in overseas jurisdictions, the ACCC may use this pre-notification process as an opportunity to commence its assessment of the transaction and front-load information gathering and document requests, potentially impacting overall review timeframes. For multi-jurisdictional acquisitions, the ACCC may use this phase to coordinate with overseas agencies, align timing and obtain bilateral confidentiality waivers from the parties.

• Review phases: Following formal notification, the ACCC will have 30 business days to make a phase 1 determination. At that stage, the ACCC may shift an acquisition to a 90-business day phase 2 review if it is satisfied that the acquisition could be likely to have the effect of SLC (i.e. where the ACCC considers there is a possibility of an SLC). The ACCC must notify the parties of the basis for a phase 2 review, including the nature of the ACCC’s theory of harm and the matters the ACCC intends to investigate before making a final determination. Within 25 business days (or as soon as practicable thereafter) of commencing phase 2, the ACCC must issue and may publish a Notice of Competition Concerns setting out the ACCC’s preliminary assessment and the evidence or other material on which it is based. Specified time limits will apply for making submissions and offering remedies. In the event the ACCC blocks an acquisition on competition grounds, the notifying parties may initiate a third phase during which the ACCC will have 50 business days to evaluate whether the transaction’s likely public benefits outweigh its likely public detriments (including the lessening of competition).

• Extensions: The ACCC may extend review timeframes if the notifying party:
  
  
  • requests an extension;
    
    
  • does not respond fully to an information request by the requested date;
    
    
  • requires more than 10 business days to respond to a compulsory s 155 notice; or
    
    
  • offers a remedy within the windows specified in the legislation.
    
    The ACCC has also outlined its approach to incomplete notifications, false or misleading information and material changes of fact (e.g. significant changes in the relevant market, changes to the transaction, or significant regulatory changes), all of which can result in timeline extensions or resets. Parties have an ongoing obligation to notify the ACCC of any material changes of fact until it makes its determination. The ACCC will have a “reasonable period” to make decisions of this type, but there is no clarity on how long that period is and the statutory clock does not stop while the ACCC forms a view.

4. Remedies and post-completion restraints

• Remedies: Parties may propose remedies at certain stages of a review to address potential competition concerns. The ACCC encourages parties to proactively consider potential remedies undertakings and suggests that parties canvass potential remedies in pre-notification discussions. However, the ACCC’s guidance is silent on the types of remedies that may be appropriate to address a particular harm, including the circumstances in which a behavioural remedy may be entertained.

• Post-completion restraints: The ACCC may, as part of its review, consider the competitive impacts of restraint of trade clauses contained in transaction documents and can declare that the statutory exception for restraints “solely for the protection of the purchaser in respect of the goodwill of a business” does not apply. To facilitate this, both the short and long notification forms require parties to provide information about any post-completion restraints in the relevant business sale agreement.

5. Completion timing and reviews

• 14-day stay on completion: Once the ACCC clears a transaction, to provide third parties an opportunity to seek merits review of the ACCC determination, the parties cannot complete for 14 days from the date on which the ACCC’s reasons are published.

• 12-month completion window: Parties will have 12 months from the date of ACCC clearance of an acquisition to complete it, after which they will need to re-notify prior to completion.

• Merits review: A party or non-party who is dissatisfied with an ACCC decision may apply to the Australian Competition Tribunal for a merits review of the ACCC determination within 14 days of reasons being published. The Tribunal’s review will primarily be based on the information that was before the ACCC, but the Tribunal is permitted to take other information into account in limited circumstances. Notifying parties may also seek review of certain process-related decisions (such as decisions to extend a review because of a material change of fact or disputes as to whether parties have responded to a s 155 notice within the specified timeframes). Details of Tribunal review processes have not yet been released.

Refreshed ACCC analytical guidance

The draft guidelines regarding the ACCC’s analytical framework represent a welcome and overdue update to the current guidelines, which were released in 2008 and last updated in 2017. The ACCC’s approach to reviewing acquisitions has evolved substantially in the interim, including as a result of increased focus on potential competition, data and ‘ecosystem’ theories through its work in the digital platforms sector. In that context, the draft analytical guidance is a timely update to ensure the guidelines reflect current ACCC practice. However, they provide limited and high-level guidance, particularly with regard to the changes to the SLC test introduced in the legislation establishing the new merger regime.

• Creating, strengthening or entrenching market power: The recent reforms expanded the SLC test by clarifying that an SLC may include creating, strengthening or entrenching market power. However, the draft guidelines provide little discussion and no examples as to how the ACCC will apply this revised test in practice – in contrast to the section on serial acquisitions, which includes several examples to illustrate possible theories of harm. This creates real uncertainty about how expansively the ACCC will apply the new test (which it now characterises as an ‘elucidation’ of the ways in which a SLC can arise rather than a change to the meaning of the test) in relation to already powerful businesses.
  
  Following on from the concerns raised by the ACCC’s Digital Platforms Services Inquiry about the tying, bundling and exclusionary data practices of digital platforms, the guidelines also foreshadow broader application of ‘ecosystem’ theories of harm based on an otherwise efficiency-enhancing integration of multiple products, but do not provide meaningful detail on the circumstances in which such concerns may arise.

• Serial acquisitions: The recent reforms also specifically empower the ACCC to assess the combined effect of ‘serial’ acquisitions by either merger party concerning the same, substitutable or competitive goods or services in the preceding three years. Beyond orthodox concerns of incremental concentration, the ACCC indicates that this power will enable it to address less conventional harms, such as difficulties faced by smaller firms in competing with a business that maintains a ‘stable of brands’. The ACCC helpfully outlines some of the evidence it may take into account, including previous and current business plans, incentives behind the acquisition strategy, and prior acquisitions that were not finalised – a form of practical guidance that would be helpful for the ACCC to provide in other parts of the guidelines.

• Loss of potential competition: The draft guidelines suggest that the loss of potential future competition between the merger parties that would likely exist in the counterfactual without the acquisition is a key focus for the ACCC. The ACCC intends to focus on ‘killer acquisitions’ of potential or nascent rivals. It will also scrutinise circumstances where an acquirer may have entered to bring more competition to a market in the counterfactual but instead decides to acquire an existing player. The ACCC will increasingly seek evidence of an acquirer’s pre-existing plans to enter or expand, actions already taken by an acquirer towards entry or expansion, incumbents’ prior responses to anticipated entry or expansion, an acquirer’s past history of entry into related markets, and/or financial advantages that would make entry or expansion attractive. Lost dynamic competition, including the potential that organic new entry may incentivise incumbents to increase investment, will be a key concern.

• Multi-sided platforms: The draft guidelines describe how the ACCC proposes to analyse mergers involving multi-sided platforms that supply services to two or more sets of customers. However, the appropriateness of the ACCC’s proposed approach to assessing matters involving such platforms is unsettled as a matter of Australian competition law (such as in relation to whether each side of the platform is a distinct market and whether constraints on both sides of the market need to be taken into account), and is the subject of ongoing litigation. Proclaiming an approach in an unqualified manner where there is no legal or economic consensus risks the guidelines being of limited utility and being quickly outdated.

More broadly, the guidelines emphasise the ACCC’s commitment to bringing greater economic rigour to its analyses, requiring ‘robust evidence’ and ‘extensive details’ of public benefits. While the commitment to robust decision-making is welcome, merger parties should prepare for a consequential increase in the costs and burden of ACCC reviews.

Guidance on the transition to the new regime

Until the new regime comes into force on 1 January 2026, parties will need to evaluate whether to use the current informal merger review process or voluntarily notify under the new regime, which is available on a transitional basis from 1 July 2025. The key risk to be managed is a prospect of being required to re-file under the new regime if informal clearance is unable to be obtained before the end of 2025 – a particular risk in the early days of the new regime when the ACCC will confront a range of implementation challenges.

• Informal clearances granted before 1 July 2025: Transactions cleared informally by the ACCC after 1 July 2025 will benefit from a grace period exempting them from the notification requirements of the new regime for 12 months from the date of the clearance decision. However, this exemption does not apply to transactions cleared before 1 July 2025. To avoid parties being required to re-notify transactions cleared before 1 July 2025 that might not complete before 1 January 2026, the ACCC is introducing a process for parties to seek an ‘updated informal view’ from the ACCC in the second half of 2025.
  
  Receiving an ‘updated informal view’ not opposing the transaction will effectively refresh the clearance so as to provide the benefit of the statutory 12-month grace period, without requiring re-notification under the new regime. Applying for an ‘updated informal view’ will require parties to lodge an application with the ACCC describing market changes and providing up-to-date market share information and other relevant information. For transaction parties who obtain an ACCC clearance before July 2025, it will be critical to keep a close and realistic eye on likely completion timing, to ensure that if there is any risk of completion delay they are able to obtain an ‘updated informal view’ by October 2025 at the latest.

• Clearance applications in mid-late 2025: Transaction parties with a choice of clearance process in the second half of 2025 also face a difficult decision as to whether they will be able to obtain a clearance under the current simpler informal clearance process or should submit to the new merger process notwithstanding its increased burdens (and uncertainties during the implementation phase).
  
  Under the current informal clearance process, clearances are typically granted in around 3-6 weeks for confidential preassessments, a further 8-12 weeks for single-phase public reviews, and a further 8-12 weeks for two-phase public reviews. However, those timings are indicative and likely to extend with the increased ACCC caseloads in the later months of 2025.
  
  The ACCC has stated that “even if there are limited or no competition risks, [informal clearance] requests received between October and December 2025 are much less likely to be considered in time”. However, for all but straightforward transactions, parties requiring clearance should consider voluntarily notifying under the new regime much earlier than that. in particular:
  
  
  • for transactions that may require public consultation under the current informal clearance regime (i.e. where the parties cannot form a confident view that a confidential preassessment will be granted), notifications will likely need to be made under the new regime from around August; and
    
    
  • for complex matters where there is a prospect of a two-phase public review, notification will likely need to be made under the new regime from around July (i.e. as soon as it is available).

Table 1 – Notification thresholds

For all thresholds, a transaction will only be notifiable if the target carries on, or intends to carry on, on a business in Australia.

_{Notes: ‘Acquirer Group’ means the acquirer and its Connected Entities. ‘Target Group’ means the target and each of its ‘Connected Entities’ that are to be indirectly acquired together with the target as part of the transaction, but does not include the turnover of any other entities not acquired as a result of the acquisition. ‘Connected Entity’ is defined broadly in the determination, and includes subsidiaries, parents, certain commonly controlled entities, and entities in respect of which a party has the capacity to determine the outcome of decisions about their financial and operating policies}

Table 2 – Requirements of notification forms

This article was updated on 2 April 2024 to incorporate the ACCC’s provisional guidance on criteria for long form notification.