The Albanese Government has released draft legislation to reform Australia’s merger rules in order to boost competition and productivity in the Australian economy.
The draft legislation released this week sets out the legal framework for the new system which will commence from January 1, 2026, subject to its passage through Parliament.
It comes amid key mergers in the fashion retail landscape, including Myer's step-in on Premier's key apparel brands, alongside the merging of peak retail bodies, the Australian Retailers Association and the National Retail Association.
According to the Treasury, these laws will simplify and speed up the process for mergers that are in the national interest and give the regulator stronger powers to identify and scrutinise transactions that pose a risk to competition, consumers and the economy.
“These changes will make it easier for the majority of mergers to be approved quickly, so the ACCC can focus on the minority that give rise to competition concerns,” the Treasury shared in a statement.
“The draft legislation delivers the necessary reforms that will enable the ACCC to better identify growing market power and protect Australian consumers from anti‑competitive mergers.
“Improving competition will mean higher quality choices for consumers and fairer prices and will boost innovation, productivity and dynamism in our economy.”
Submissions on the draft legislation are open until August 13, 2024, and Treasury will consult on the notification thresholds later this year.
The ACCC gave its tick of approval for the new draft legislation, with chair Gina Cass-Gottlieb saying the consultation is a key step in the process of developing the law that will ensure the reforms achieve their intended objectives.
"The reforms are important to achieve a simplified merger control framework that prevents harmful anti-competitive transactions and benefits Australian consumers and businesses of all sizes," Cass Gottlieb said.
“We welcome the opportunity the Government has provided for consultation with the wider community to ensure these reforms achieve their intended policy objectives.”
Cass- Gottlieb also welcomed the Treasury’s plan to consult separately on the notification thresholds.
“We note having the right thresholds for proposed mergers to be reviewed by the ACCC will be key to the effectiveness of the proposed new regime and its ability to achieve the Government’s policy objectives of preventing mergers that pose a risk to competition, consumers and the economy,” Cass-Gottlieb said.
“The new merger regime needs to strike the right balance between ensuring that potentially anti-competitive mergers are scrutinised and where necessary prevented, while minimising regulatory burden for acquisitions that do not have anti-competitive effects.”
The ACCC has previously highlighted research by the Treasury’s competition taskforce that an estimated 1000-1500 mergers occur in Australia each year. However, only about 330 are notified to the ACCC under the existing voluntary merger regime.
“The new merger regime must address the deficiencies of current merger laws in allowing too many mergers to escape the competition regulator’s scrutiny,” Cass-Gottlieb said.
In addition to the release of draft legislation, the government has appointed Andrea Gomes da Silva as an independent expert advisor.
Gomes da Silva will advise Treasury and the ACCC on implementing the new merger control system effectively, including advice on ACCC capabilities, practice, systems and resourcing, and delivering the government’s reforms through a risk‑based approach to merger review.
Gomes da Silva brings extensive experience as a merger decision maker and leader at the United Kingdom Competition and Markets Authority (CMA) and as a competition lawyer. She led the CMA’s merger functions after the United Kingdom’s exit from the European Union.
“Ms Gomes da Silva's expertise and independent views will provide valuable insights on important policy design and implementation issues relating to the reforms,” Cass-Gottlieb said.
“Ms Gomes da Silva's advice will assist Australia transition to the new merger control regime, in line with international best practice.
“We look forward to drawing on Ms Gomes da Silva's international perspective and her experiences, including during her leadership role at the UK competition regulator during a time of complex and significant change.”
The ACCC will also renew and expand its Performance Consultative Committee to advise on the ACCC’s merger review functions as well as the broad range of the ACCC’s responsibilities.
“Our Performance Consultative Committee will consist of a range of stakeholders including consumer, business, and legal representatives,” Cass Gottlieb said. “The Committee will provide feedback on ACCC initiatives and a forum for exchange of perspectives on key issues.”
The membership of the refreshed ACCC Performance Consultative Committee will be announced in due course.