New mandatory merger notification regime passed by Parliament 

Key points

• Under the new regime, acquisitions that meet certain thresholds must be notified to the ACCC and cannot be completed unless the ACCC clears the deal. This is the biggest change to Australia’s merger laws in 50 years.
• The new laws apply to acquisitions ‘put into effect’ after 1 January 2026. For agreements entered into before 2026 that will be completed after 1 January 2026, it will be possible to make notifications under the new regime from 1 July 2025.
• When notifying an acquisition, parties will need to inform the ACCC about every acquisition they have put into effect in the same industry in the past 3 years. The ACCC can base its decision on the combined effect of all of these acquisitions.
• The ACCC will be subject to statutory time limits. However, for more complex transactions, the ACCC expects parties to meet with it to explain the deal and negotiate information requirements before the timeline officially starts. The ACCC is expected to require far more data and information than it does now and can ‘stop the clock’ until it receives this. Overall, clearances are expected to take longer and cost more than they do now.
• Critical details of the new regime are yet to be finalised, including the notification thresholds, notification forms, filing fees and waiver processes.

The most consequential changes to Australia’s merger review laws in 50 years were passed by Parliament on 28 November 2024,¹ and will replace Australia’s current informal and voluntary merger clearance regime with a mandatory and suspensory administrative merger regime (Mandatory Notification Regime).

The new laws apply to acquisitions that will be ‘put into effect’ from 1 January 2026. This means many agreements that may be entered into well before 2026 may be subject to the new laws. In this case, transitional arrangements mean that merger parties can ‘opt in’ to the Mandatory Notification Regime from 1 July 2025 onwards.

We summarise below the key features of the Mandatory Notification Regime, how the transition from the current system will work and what we still don’t know about the new regime.

Key features of the new Mandatory Notification Regime

Mandatory and suspensory

Any acquisition of shares or assets that meets relevant notification thresholds and will be put into effect after 1 January 2026, must be notified to the ACCC and cannot be completed unless and until the ACCC (or the Australian Competition Tribunal on review) determines that the transaction may be put into effect.

Failure to comply with these requirements will mean the transaction is void and may also result in penalties of up to $50 million, three times the benefit of the illegal conduct or 30% of Australian group turnover.

Mandatory Merger Notification thresholds

The Mandatory Notification Regime will broadly apply to acquisitions of shares or assets that result in a change of control and exceed relevant notification thresholds (unless otherwise exempted).

The notification thresholds will be set out in subordinate legislation, which has not yet been finalised. However, Treasury has indicated that the monetary notifications thresholds will be as follows:

The Treasurer will be able to set specific notification thresholds for particular industries, markets, classes of assets, or even specific acquirers. For example, the Treasurer has indicated that the government intends to use this power to ensure that:

• the ACCC is notified of every merger in the supermarket sector, and that the government will also consider designation requirements for sectors such as fuel, liquor and oncology-radiology; and
• the ACCC reviews purchases of an interest above 20% in an unlisted or private company, if one of the companies involved in the deal has turnover of more than $200 million.

The new regime will also apply to acquisitions of land, including leases and exercises of lease options. However, the government has proposed an exemption from notification for land acquisitions made in relation to residential property development or by any business that is primarily engaged in buying, selling or leasing property and which does not intend to operate a commercial business (other than leasing) on the land, unless those acquisitions are captured by additional targeted notification requirements.

Three year ‘look back’ period to capture serial acquisitions

The three-year cumulative turnover threshold set out above means that, once an acquirer group meets either of the cumulative thresholds in a given three year period, every additional transaction over $2 million that the acquirer group makes in the same or substitutable goods or services in that three year period will need to be notified to the ACCC. Further, when the ACCC is considering a proposed transaction, it will now be able to aggregate the effect of that particular transaction with the effect of all other acquisitions put into effect by the acquirer where the target was involved in the supply of the same or substitutable goods or services (disregarding any geographical factors or limitations) in the previous three years. This may have significant implications for parties which are in the process of, or proposing to, roll up a number of smaller targets in an industry as part of their growth strategy.

Expanded interpretation for ‘substantial lessening of competition’ test

The ACCC will be able to block an acquisition if it is satisfied that the acquisition would have the effect or be likely to have the effect of substantially lessening competition in any market. The new laws also provide that, for the purposes of the merger regime only, an acquisition may substantially lessen competition in a market if it would, in all the circumstances, create, strengthen or entrench a substantial degree of power in the market, even if the change is not, itself, substantial. Although this will not affect the meaning of ‘substantially lessen competition’ used elsewhere in the Competition and Consumer Act 2010 (Cth) (CCA), it may have important implications for companies which already have (or which the ACCC may consider have) substantial market power and are looking to make further acquisitions.

Review timelines

In summary, the timeline for reviews under the Mandatory Notification Regime are as follows:

While these statutory timelines are intended to provide greater certainty to businesses, for acquisitions of any complexity, the legislated timelines are likely to be only part of the story. The ACCC has stated that, as part of the new merger review regime, it will conduct more formal econometric analysis of mergers. This will require parties to provide more information and data than under the current system, which may take substantial time and expense to obtain. The ACCC has also indicated that it expects parties to engage in pre-notification discussions (particularly in more complex cases) with the ACCC to work through what data is necessary, what is available and what data the ACCC will insist on for its analysis.

This process, and the process of them actually obtaining the data required by the ACCC, may take a considerable amount of time before a notification can then be formally made. If parties notify a complex merger to the ACCC without these pre-notification discussions and negotiations with the ACCC, there is a significant risk that the ACCC could issue extensive information requests after they receive the formal notification. If the parties take more than two weeks to fully respond to any request, the ACCC can ‘stop the clock’ until all the requested information is provided. Unless an acquisition is simple, this may add significantly to the real amount of time taken to obtain clearance for an acquisition. The ACCC’s ability to ‘stop the clock’ in this way, together with the expectation that parties will engage with the ACCC before making any notification, means that transaction clearance timelines have the potential to be longer and less certain in practice than the legislation may suggest.

No ‘safe harbour’ for transactions which fall below merger notification thresholds

The existing prohibition contained in section 50 of the CCA has not been repealed. This prohibits any mergers that are likely to substantially lessen competition in a market, even if they do not meet the thresholds set out in the new regime. This means that falling below the merger notification thresholds does not provide a ‘safe harbour’ for a transaction that may still substantially lessen competition in a market. Accordingly, for parties planning to implement smaller transactions which do not trigger the notification thresholds but nonetheless raise potential competition law concerns (eg acquiring a competitor in a concentrated local geographic market), it may be necessary or prudent to voluntarily notify such transactions under the new system to obtain a determination that the acquisition may be put into effect.

Transitional considerations

The Mandatory Notification Regime will apply to acquisitions which are ‘put into effect’ on or after 1 January 2026. Where parties enter into an agreement before 1 January 2026 that will be put into effect after 1 January 2026, the parties can notify the transaction to the ACCC under the Mandatory Notification Regime from 1 July 2025. Notification is not required under the new regime if a transaction is cleared by the ACCC under the current informal merger clearance regime or merger authorisation regime between 1 July 2025 and 31 December 2025, provided that it is put into effect within 12 months of receiving ACCC clearance.

However, in practice, merger parties considering transactions in the second half of 2025 will need to closely consider whether it may be prudent to voluntarily notify under the new regime (eg to avoid having to renotify if they do not receive ACCC informal clearance in time and the transaction will otherwise exceed the notifications thresholds and may not be put into effect until after 1 January 2026). In addition to timing and process considerations, parties will also need to give thought to any consequent changes to transaction documents (eg relating to ACCC condition precedents).

What we still don’t know about the mandatory notification regime 

While the Mandatory Notification Regime has been passed by Parliament, there are still a number of critical details which are yet to be released or finalised, which we will continue to monitor as additional information becomes available. These include the following:

• Notification thresholds and waivers: As set out above, while Treasury has released proposed notification thresholds, these are yet to be finalised. In addition, the government has indicated that a process will be introduced to allow a ‘notification waiver’ from the ACCC, the details of which will be set out in subordinate legislation which is yet to be released. The usefulness of any notification waiver process will depend upon the criteria for the waiver, the amount of information that needs to be provided to apply for the waiver, the level of discretion afforded to the ACCC, and the timelines that will apply.
• Notification forms: Notification of an acquisition will not be taken to be complete, and the ACCC review timeline will therefore not commence, until all of the information required by the ACCC has been provided. The ACCC has not yet released drafts of the notification forms or information that will need to be completed when notifying an acquisition but has indicated that public consultation will take place on these in Q1 2025. As noted above, the ACCC has indicated that it intends to move to a more formal, data driven process of merger analysis. This suggests that the ACCC is likely to require merger parties to provide far more detailed information and data upfront than has typically been required in the past for informal merger clearance processes, particularly for more complex transactions.
• Filing fees: Notifications will be accompanied by a filing fee. While these have not yet been confirmed, Treasury has indicated that they may be in the range of $50,000 to $100,000.
• ACCC guidance: The ACCC has indicated that it will issue draft guidelines, including process guidelines, analytical guidelines and transitional arrangement guidelines, for consultation in early 2025 to assist businesses and stakeholders in adapting to the new regime.

How can we help?

The Mandatory Notification Regime is complex and will have significant consequences for mergers and acquisitions in Australia, as well as the regulatory landscape more broadly. We have a dedicated and experienced specialist competition law team that can assist you with navigating the transition to the Mandatory Notification Regime. Please contact us if you would like more information.

This article was written by David Fleming, Partner, Richard Westmoreland, Partner, Alexander Shepherd, Associate and Monica Jones, Solicitor.

¹ See Treasury Laws Amendment (Mergers and Acquisitions Reform) Bill 2024