The Treasury Laws Amendment (Mergers and Acquisitions Reform) Act 2024 (Cth) (Mandatory Notification Regime) was assented to on 10 December 2024, bringing about the most significant change to Australia’s merger notification regime in 50 years. The Mandatory Notification Regime means that any purchase of a business put into effect after 1 January 2026 that exceed the requisite thresholds will need to be notified to the Australian Government and the Australian Competition and Consumer Commission (ACCC) and will require ACCC clearance.

The high turnover value of motor vehicle dealerships means that most motor vehicle dealership acquisitions are now likely to require compulsory ACCC clearance – even if they would not otherwise give rise to competition concerns.

The ACCC have recently released further insights into the structure and requirements of the new regime. These updates are set out below.

Acquisitions that Require Notification

The notification thresholds are yet to be finalised. However, it is likely that acquisitions will need to be notified if they meet any of the following thresholds:

If purchase price for the business will be $250 million or more;

• If the acquirer and its related entities have a combined turnover of $150 million or more, and the turnover of the dealerships being acquired is $50 million or more. If the group making the acquisition has put other acquisitions into effect within the past three years, then ACCC clearance will be required if the combined turnover of those businesses, plus the turnover of the business being purchased exceeds $50 million; and
• If the acquirer and its related entities have a combined turnover of $500 million or more, and the turnover of the dealerships being acquired is $10 million or more. If the group making the acquisition has put other acquisitions into effect within the past three years, then ACCC clearance will be required if the combined turnover of those businesses, plus the turnover of the business being purchased exceeds $10 million.

Transactions that do not meet any of the thresholds are not subject to mandatory notification, but they will remain subject to the general prohibition on mergers that substantially lessen competition under section 50 of the Competition and Consumer Act 2010 (Cth).

Transitional Provisions

The implementation of this new regime for any transactions ‘put into effect’ from 1 January 2026 means that any transactions that begin in 2025, but are not completed before 1 January 2026, will become subject to the new regime. To aid the transition, parties have the option of voluntarily notifying a transaction under the new regime from 1 July 2025 onwards. Alternatively, the current informal clearance procedure will still be available until 31 December 2025, although the ACCC has warned that informal merger clearance applications lodged after October 2025 are likely not to be able to be considered by the ACCC under the current informal regime prior to the commencement of the Mandatory Notification Regime on 1 January 2026.

Automotive businesses intending to complete mergers within the next 6 months should consider whether they can accelerate their transaction to ensure it will be complete prior to 1 January 2026. Alternatively, they should consider seeking clearance under the current informal ACCC clearance regime (which will be much easier, quicker and cheaper than the new regime) while that regime is still available.

Merger Process Guidelines

The draft merger process guidelines have provided some clarification on the ACCC’s powers and the potential timeline for mandatory notifications, including that:

• The ACCC is encouraging businesses to engage with them prior to lodging a notification. This engagement should occur at least two weeks prior for standard transactions, and much earlier for complex transactions.
• In theory, the ACCC is required to determine the initial phase of a notification process within 30 business days, and for those transactions that raise competition concerns, the ACCC has an additional 90 business days to consider the transaction. However, the ACCC has the power to extend determination timeframes including where parties are required to provide additional information.
• Confidential reviews will only be available for surprise hostile takeovers and voluntary transfers of certain entities. Otherwise, all other notified transactions will be published on the Acquisitions Register.

Notification Criteria

Draft ‘short’ and ‘long’ notification forms have been released providing that parties must disclose to the ACCC:

• For both notification types, information including the parties, the proposed acquisition, acquisitions put into effect in the past 3 years, certain contracts, any goodwill protection provisions and other documents. The forms also note that any other information or documents that a third party may reasonably consider relevant to the ACCC’s assessment should be disclosed, creating a very broad disclosure obligation for the parties.
• For long-form notifications further information will be required, such as about the parties, details of the process, alternative proposals from the past 12 months, competitive dynamics and the nature of the acquisition.
• The ACCC has indicated that the long form will be required for acquisitions that are seen to create more substantial competition concerns, for example, an acquisition that increases the market share of the merged business to a significant degree.

Relevance

For the automotive industry, any acquisitions and mergers that meet the thresholds set out in the Mandatory Notification Regime, such as for dealership businesses, will be required to be notified to the ACCC. Given that dealership businesses deal in high value goods, the automotive industry can expect to meet these thresholds more often than not.

As such, automotive companies intending to undertake a merger or acquisition before the end of 2025 should consider whether to continue under the old merger scheme and complete the transaction before 1 January 2026, which may involve obtaining informal clearance, or to opt-in to the new regime now.

Consultation is still open on certain aspects of the merger process, with further guidance and refinement to these new laws expected to be released prior to 1 January 2026, when the new regime becomes compulsory.

Follow the HWL Ebsworth Lawyers article link to read more at: New Mandatory Merger Notification Regime: Further Details Released.

See also our previous article on the new regime at: New Mandatory Merger Notification Regime Passed by Parliament.

This article was written by Justin Pasa, Partner, Evan Stents, Partner and Maria Townsend, Partner.