Deals closing in Q3 and Q4 of 2025 and beyond
Is it an acquisition within the scope of the regime?
Acquisitions of the following are within scope:
- Acquisitions that are ‘connected with Australia’ (that is, involves the acquisition of shares in or assets of or used in an entity that carries on business in Australia)
- Results in the acquirer obtaining control of the target, that is, the capacity to determine the outcome of decisions about the second entity’s financial and operating policies
- Assets, including legal or equitable interests in tangible or intangible assets, property, land, goodwill, intellectual property rights or partial interests in assets
- Shares
- Units in a unit trust
- Interests in managed investment schemes
Acquisitions that do not fall within the scope of the regime
Acquisitions of the following are outside the scope:
- Acquisitions that are not connected with Australia.
- Acquisitions that do not result in the acquirer obtaining control of the target.
- Internal restructures and re-organisations.
- Acquisitions of assets in the ordinary course of business.
- Certain land acquisitions for residential or commercial property development activity.
- Acquisitions by an administrator, receiver, receiver and manager or liquidator.
- Acquisitions pursuant to succession (e.g. testamentary disposition, intestacy or right of survivorship).
- Certain financial acquisitions including the taking of security, acquisitions of interests in securities, acquisitions of exchange traded derivatives and acquisitions in relation to capital raising (e.g. rights issues, dividend reinvestment, share bonus plans, underwriting of fundraising and buy-backs).
Does the deal trigger the notification thresholds?
What does the process look like?
Step 1: Preliminary consultation with the ACCC.
Step 2: Parties complete and submit a long or short notification form. The long form is required where:
- For acquisitions of a competitor: Estimated market share post-acquisition is:
- ≥ 40 per cent and the increment resulting from the acquisition is ≥ 2 per cent OR
- ≥ 20 per cent – 39 per cent and the increment resulting from the acquisition is ≥ 5 per cent
- For acquisitions within supply chains: The party:
- In the upstream market has a market share ≥ 30 per cent and the other party has a downstream market share of ≥ 5 per cent
- In the downstream market has a market share ≥ 30 per cent and the other party has an upstream market share ≥ 5 per cent
- For acquisitions by conglomerate: The parties supply adjacent products or services and one of the parties to the acquisition has a market share ≥ 30 per cent.
- For acquisitions that are otherwise sensitive: Including where the target is a vigorous and effective competitor, is developing a significant product, or where the acquisition is of a business that supplies or controls a key input.
Step 3: The ACCC will confirm if the application is complete (after the filing fee is paid) and the review timeline will begin.
How long will the ACCC review take?
| Phase |
Timing |
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Pre notification discussions
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The ACCC encourages parties to a notifiable acquisition to engage with it before formally lodging a notification. Businesses can commence pre-notification engagement by lodging a request via a new to be developed mergers portal. The ACCC will engage ‘promptly and meaningfully’ with businesses once a request is received. The ACCC recommends that parties initiate pre-notification engagement at least two weeks before formal notification and earlier for acquisitions which may raise competition concerns |
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Phase 1
(15-30 business days)
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There will be an initial ‘Phase 1’ review process of 30 business days, from a complete application being lodged. Most deals are expected to clear in this timeframe. There will also be scope for a fast-track determination by the ACCC after 15 business days if no competition issues arise.
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Phase 2
(+90 business days)
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A ‘Phase 2’ review will be more in-depth and will take up to a further 90 business days. At the end of Phase II, the merger can be put into effect with or without conditions or disallowed by the ACCC entirely. The ACCC cannot block a merger unless a Phase II review has occurred.
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Public benefit assessment (+50 further business days)
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From 2026, approval on the basis that there are substantial public benefits that outweigh anti-competitive downsides, is only able to be sought by merger parties if the ACCC blocks the deal in Phase II. The prescribed period for this review is an additional 50 business days.
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Regime promotes timing discipline but the clock can be stopped
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If an ACCC determination is not made within the statutory timeframe for Phase 1 or Phase 2, the acquisition will be deemed approved. This is a significant shift from the current flexible timeframes for reviews in the informal regime that can be varied unilaterally by the ACCC. However, in practice we would expect the ACCC to utilise ‘stop the clock’ mechanisms to extend the statutory timelines thereby providing some flexibility.
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Other important aspects
- The substantive test: The ACCC must be ‘satisfied’ that a notified acquisition would have the effect or likely effect of substantially lessening competition in order to oppose it proceeding.
- To address “creeping acquisitions” the new law:
- Makes clear that a substantial lessening of competition arising from a merger can include creating, strengthening or entrenching a substantial degree of market power.
- Enables the ACCC to look at all transactions undertaken by a party to the notified acquisition that are valued at more than $2 million and connected to Australia in the past three years in assessing the impact of the notified acquisition and in applying the thresholds.
- Acquisitions below thresholds: The ACCC will monitor acquisitions and will take appropriate investigatory and enforcement actions in respect of anti-competitive acquisitions, even if they fall below the thresholds for mandatory notification.
- Review will be public: The ACCC will publish the key details of the transaction shortly after receipt of a notification.
- Implications of not notifying: Putting a notifiable transaction into effect (including certain pre-completion coordination with the target/purchaser) without receiving clearance of a notifiable transaction is a breach of the Act and significant penalties may apply. It will also render the transaction void.
- Restraints in sale documents – the ACCC will have the power to review and invalidate restraints if it considers they go further than necessary to protect goodwill.
Appendix 1: Turnover calculation methodology
The approach to calculating turnovers and transaction values is similar to that which applies in many jurisdictions.
1. Calculate the turnover of all parties to the transaction
| Each principal entity acquiring control |
The target |
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Current GST Turnover of each principal party to the acquisition and each of its connected entities.
In effect, this looks at the Australian turnover of the entire corporate group involved in the transaction.
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- Acquisition of shares: the Current GST Turnover of the target and each of its connected entities.
- Acquisition of assets: the Current GST Turnover of the target to the acquisition to the extent that it is attributable to the asset.
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2. Consider the transaction value
3. Notes
- In calculating if the target turnover thresholds are met the current acquisition and past acquisitions of the same or similar goods or services within the three-year period need to be treated as one acquisition. However, any acquisitions of targets that had a GST Turnover below $2 million or were not ‘connected to Australia’, can be disregarded.
- In measuring a transaction’s value, the market values of all shares and assets being acquired and the consideration received or receivable for all of the shares and assets being acquired, must be considered.
- The draft proposed filings forms will require reporting of historical turnover for three years.
- Current GST Turnover means the sum of the values of all the supplies that you have made, or are likely to make, during the 12 months ending at the time of filing, other than:
- Supplies that are input taxed
- Supplies that are not for consideration (and are not taxable supplies under section 72‑5 of A New Tax System (Goods and Services Tax) Act 1999 (Cth)
- Supplies that are not made in connection with an enterprise that you carry on
- An entity will be a ‘connected entity’ if the principal party controls the second entity (i.e. it has the capacity to determine the outcome of decisions about the second entity’s financial and operating policies) or where the second entity is associated to the first under s 50AAA of the Corporations Act 2001.
- While the preceding notification thresholds apply generally across the economy, certain transactions within the supermarket sector must be notified regardless of whether they meet the general notification thresholds and regardless of whether they result in a change in control.
- Major supermarkets – Coles and Woolworths (including their connected entities) – must notify the ACCC of acquisitions of shares or assets where they are acquiring:
- A supermarket business (in whole or in part i.e. a business engaged in the retail supply of grocery products).
- A legal or equitable interest in land (in whole or in part) that meets certain land size requirements (> 700m2 for a commercial building or > 1,400m2 for land) and is not a lease extension or renewal for land that has a currently operating commercial business.
