The Federal Parliament has passed legislation introducing sweeping changes to Australia’s merger control laws. From 1 January 2026, the current voluntary informal clearance regime will be replaced by a mandatory pre-merger notification regime. Under the new regime, acquisitions that exceed certain monetary thresholds will need to be notified to the ACCC. This will bring Australia’s merger regime in line with international best practices.

While the current informal clearance regime will still be available until the end of 2025, merger parties will be able to voluntarily notify their acquisitions under the new regime from 1 July 2025. If an informal clearance application is not determined by the ACCC before 31 December 2025, the acquisition will need to be re-notified under the new regime.

It may therefore be prudent for parties to avail themselves of the new regime in the transition period, particularly in the case of potentially contentious or more complex acquisition proposals, including global acquisitions requiring lengthy multi-jurisdictional filing processes.

The key features of the new regime are:

Suspensory effect

Parties will be prohibited from implementing a notifiable acquisition prior to having notified it to the ACCC and obtained the ACCC’s approval. If a notifiable acquisition is put into effect without notification (“failure to file”) and/or ACCC approval (“gun jumping”), it will be void and the parties will be subject to pecuniary penalties.

The new regime will require merger parties to be extra careful to avoid any gun-jumping risks when conducting due diligence or engaging in integration planning.

Mandatory notification thresholds

Acquisitions that exceed any of the monetary thresholds will need to be notified to the ACCC. While the monetary thresholds are yet to be determined by regulation and subject to further consultation, the Treasury has provided some detail about the proposed thresholds:

An acquisition will be notifiable if one of the following thresholds is met:

• Economy-wide threshold
  • The combined Australian turnover of the parties exceeds $200 million; AND
  • either the Australian turnover of each of at least two of the parties exceeds $50 million OR the global transaction value exceeds $250 million.
• Large acquirer threshold
  • The acquirer’s Australian turnover exceeds $500 million; AND
  • the Australian turnover of each of at least two of the parties exceeds $10 million.
• 3-year cumulative threshold
  • Large acquisitions - The combined Australian turnover of the parties exceeds $200 million; AND
  • the cumulative Australian turnover from acquisitions relating to the same or substitutable products over a 3-year period exceeds $50 million.
    OR
  • Large acquirers - The acquirer’s Australian turnover exceeds $500 million; AND
  • the cumulative Australian turnover from acquisitions relating to the same or substitutable products over a 3-year period exceeds $10 million.
  • Exclusion: Acquisitions of a target with less than $2 million Australian turnover will be excluded from the application of the cumulative threshold.
• As an additional requirement, the target of the acquisition will need to have a “material connection” to Australia, which will be satisfied if the target is carrying on business in Australia or has plans to do so.

The Minister’s power to designate notifiable acquisitions

The Minister will have the power to determine classes of acquisitions that are required to be notified even if they do not meet any of the monetary thresholds (e.g. in industry sectors with high levels of market concentration or high barriers to entry). The Minister has indicated that this power may be used in relation to acquisitions by supermarkets. Further sectors which may be targeted by way of ministerial determination include fuel, liquor and oncology radiology.

Exempted acquisitions

Acquisitions of shares that do not give control over the target will be exempt from the notification requirement. In particular, a notification will not be required if:

• before the acquisition, the acquirer already controls the target; or
• after the acquisition, the acquirer does not control the target.

An acquirer will have “control” over the target if it has the capacity to determine the outcome of decisions about the target’s financial and operating policies.

In addition, acquisition of shares in listed corporations, widely-held unlisted entities or listed registered schemes will be exempt from the notification requirement if:

• before the acquisition, the acquirer already has 20% or more of the voting power in the target; or
• after the acquisition, the acquirer’s voting power in the target remains below 20%.

However, the Minister will have the power to determine classes of acquisitions of shares that are required to be notified even if they are covered by the above exemptions.

Waiver from notification requirement

There will be a process whereby parties may seek a notification waiver from the ACCC.

While there are currently no details available about this process, the ACCC has suggested that notification waivers may be available for acquisitions that are unlikely to meet the monetary thresholds or raise any competition concerns (e.g. where there is no competitive overlap between the parties’ operations in Australia).

Pre-lodgement engagement

The ACCC will encourage parties to engage with it in pre-lodgement discussions, particularly for more complex transactions. The main purpose of these discussions will be to identify the information and economic data that the parties will need to submit.

While such a process will add time to the transaction timeline, it will likely have the benefit of reducing the risk of parties submitting an incomplete notification and/or the ACCC “stopping the clock” by way of additional requests for information.

Review process and periods

The statutory review periods will start once a complete notification has been received by the ACCC. The review process will consist of the following steps:

• Phase 1 competition review: The statutory period for the initial review will be 30 business days, but the ACCC may make a “fast-tracked” determination already after 15 business days (but not earlier). The ACCC will either determine that the acquisition can be put into effect (with or without conditions) or that it needs to conduct an in-depth review.
• Phase 2 competition review: The statutory period for the in-depth review will be 90 business days. The ACCC will either determine that the acquisition can be put into effect (with or without conditions) or must not be put into effect.
• Substantial public benefit application: If the parties make a substantial public benefit application within 21 days of the ACCC’s phase 2 determination to oppose an acquisition, the statutory period for the public benefit assessment will be 50 business days. The ACCC will then again either determine that the acquisition can be put into effect (with or without conditions) or must not be put into effect.

The above statutory timeframes will be extended by 15 business days if a remedy is offered. The ACCC will also have the ability to “stop the clock” by, for example, requesting additional information from the parties or issuing a section 155 Notice requiring the parties to furnish information or produce documents.

Competition test

The ACCC must not oppose an acquisition (following a phase 2 review) unless it is satisfied that the acquisition would have, or would be likely to have, the effect of substantially lessening competition (SLC). The SLC test has been amended and now explicitly states that an acquisition may have the (likely) effect of SLC if it creates, strengthens or entrenches a substantial degree of power in a market. The purpose of this amendment is to emphasise the importance of considering the competitive structure of the relevant markets when assessing the competitive effects of an acquisition and to clarify that even an incremental increase in market power may amount to an SLC.

Serial acquisitions

In addition to aggregating the turnover from all relevant acquisitions made over a 3-year period for the purposes of determining whether a notified acquisition meets the monetary thresholds (see above), the ACCC will now also be able to include in its assessment of the competitive effects of a notified acquisition the combined effects of all relevant acquisitions made by the same acquirer over the 3-year period preceding the notified acquisition.

Substantial public benefits application

Parties will have the right to make an application to the ACCC to approve an acquisition on “substantial public benefit” grounds if the ACCC opposes an acquisition on competition grounds at the conclusion of the phase 2 review. The ACCC may approve an acquisition on substantial public benefit grounds if it is satisfied that the acquisition would be likely to result in a benefit to the public which would substantially outweigh the detriment to the public likely to result from the acquisition.

Goodwill protection

The parties must notify to the ACCC any restraint provisions contained in a business sale agreement to protect the purchaser in respect of the business’ goodwill (e.g. non-compete clauses for the seller). The ACCC has the power to declare that the exemption for goodwill protection provisions does not apply if it is satisfied that a particular provision is not necessary to protect the purchaser of the business. If the ACCC makes such a declaration, the relevant restraint provision may be at risk of breaching the cartel conduct or other competition law prohibitions.

Transparency

Details about every notification of an acquisition will be published on a public register within 1 business day of the notification date. The “acquisitions register” will be kept by the ACCC and be accessible to the public online. There is an exception for “surprise” hostile takeovers which can initially be assessed by the ACCC confidentially.

The ACCC’s reasons for final determinations on all notified acquisitions will be published, which is a major shift from the current voluntary regime.

The ACCC is expected to release draft guidelines on the merger process and analytical assessment of mergers for consultation in the first quarter of 2025.

Notification fee

Every notification will attract a filing fee which will likely be in the order of between $50,000 - $100,000. A notification will not become effective until the filing fee has been paid.

Notification form

There will be a notification form with clearly defined upfront information requirements. The Minister has also indicated that there will be a simplified notification form for acquisitions that are unlikely to raise any competition concerns.

Tribunal Appeal

If the ACCC as the administrative decision maker determines that an acquisition must not be put into effect, the parties may lodge an appeal to the Australian Competition Tribunal (Tribunal) within 14 days of the ACCC’s determination. The review by the Tribunal will be a limited merits review and producing new information and evidence will only be allowed in limited circumstances.

The statutory timeframe for the Tribunal review will be 90 calendar days, but it can be extended.