Reforms to speed up "national interest" mergers but with greater scrutiny on risks to consumers

In a joint statement, Treasurer Jim Chalmers and Assistant Minister for Competition, Andrew Leigh, said the 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".

If the legislation is passed, reforms will commence at the start of 2026 with mergers "approved to proceed within 30 working days where the regulator decides they raise no competition concerns".

This compares to an average period of 171 days currently, according to the Business Council of Australia (BCA), with the longest being 260 days. The council has responded positively to the reforms, describing them as striking a balance between economic and regulatory needs, although ongoing close consultation will be needed to avoid burdening businesses with unintended consequences.

Chalmers and Leigh highlighted the current system with three paths to merger approval is not only inefficient but can mean "some businesses game the system to effectively avoid proper assessment".

"We are reducing these three streams to a single, streamlined path to approval that removes duplication and standardises notification requirements for all mergers," they said.

"Competition issues will no longer be separately assessed under the Foreign Acquisitions and Takeovers Act of 1975, removing unnecessary regulatory duplication for businesses."

General notification requirements will also apply, and the Minister will be given power to introduce additional targeted notification obligations.

The Treasurer and Assistant Minister for Competition noted that  Australia’s competitiveness has been declining since the 2000s, while market concentration has nearly doubled since 2010.

"Our new reforms will make our merger approval system faster, stronger, simpler, more targeted and more transparent," Chalmers and Leigh said.

"Most mergers have genuine economic benefits – allowing businesses to achieve greater economies of scale and scope, helping them to access new resources, technology and expertise.

"However, they can cause serious economic harm when firms are solely focused on squeezing out competitors to capture a larger percentage of the market."

Australian Competition and Consumer Commission (ACCC) Chair Gina Cass-Gottlieb welcomed the proposed reforms.

"We welcome the Treasurer’s announcement today that the government will move to strengthen Australia’s merger laws, which will benefit Australian consumers and businesses of all sizes, as well as the wider economy," she said.

"Higher prices, less choice and less innovation can result from weakened competition. Stronger merger laws are critical to ensure anti-competitive mergers do not proceed.”

“These proposed changes are significant and will reinforce public confidence in Australia’s competition laws,” 

Currently Australia's merger regime does not require merger parties to notify the ACCC of proposed acquisitions or to wait for ACCC clearance before proceeding.

The proposed reforms include introducing a mandatory notification requirement for merger deals above certain thresholds, and a prohibition on merger transactions proceeding without receiving a determination from the ACCC or Tribunal.

The ACCC also welcomes the Treasurer’s announcement that merger laws will be updated to better deal with serial acquisitions, where a number of smaller transactions occur over time that result in serious harms to competition.

After welcoming the news, BCA chief executive Bran Black highlighted how mergers can lead to diversification and efficiencies that benefit consumers, while the ability of businesses to acquire, dispose, restructure and merge forms an "integral part of commerce".

"The Government has accepted important points advocated by the BCA, including there be no change to the onus in the merger test, clear decision-making timelines and streamlining FIRB (Foreign Investment Review Board) competition assessments," Black said.

"This is a significant piece of reform, and we are encouraged that the Government has listened to business and taken on our concerns regarding the importance of outcome certainty, timeliness and transparency.

"When implementing this reform, we need to ensure Australia’s merger regime doesn’t add further red tape to businesses. For example, the BCA expects to see reasonable and practical thresholds for merger notification."

The watchdog will also have greater visibility of merger activity and competition issues, and a public register of all mergers and acquisitions will be created to promote transparency, accountability and competition.

"Competition is a defining feature of our culture and we want to make it a more central, defining feature of our economy as well," Chalmers and Leigh said.

"Competition means more and higher quality choices for consumers, at fairer prices, it makes our businesses more dynamic, more innovative and more productive and expands our economy.

"Competition policy is a growth strategy and reforming our mergers system will benefit businesses as well as consumers and the broader economy."

The reforms announced today build on substantial consultation with industry, and were crafted with advice from the Competition Taskforce expert advisory panel made up of David Gonski, Kerry Schott, John Asker, Sharon Henrick, John Fingleton, Danielle Wood and Rod Sims.

"We want mergers to drive improvements in productivity, to put downward pressure on prices and to deliver more choice for Australians under the pump with the cost of living," Chalmers and Leigh said.