New Notification Regime for Mergers of Australian Businesses
The Federal Government finished November with a flourish this year, passing a raft of new legislation in a matter of days.
The greater part of media scrutiny was focused on the Government’s social media ban for people under sixteen, however other changes, such as new rules for business mergers, also merit some attention.
A new regime of mandatory notification
Under the new laws, Australia will adopt a mandatory notification regime for business mergers that exceed certain monetary thresholds. Although the vast majority of business sales and mergers will be well below the lowest thresholds, medium-sized private businesses may still be surprised to find themselves potentially caught by the new rules.
In short, qualifying mergers will need to be notified in advance to the Australian Competition and Consumer Commission (ACCC). Failure to notify the ACCC will render the transaction void and expose the parties to penalties.
Transactions will need to be notified to the ACCC if they:
- result in a change of control of an Australian business; and
- meet one of a range of monetary thresholds.
The majority of the monetary thresholds are significant and are targeted at very large transactions, but one threshold may be more relevant to private businesses.
A transaction involving an Australian business with turnover of at least $10 million (where the acquiring party is a large group with Australian turnover of at least $500 million) will require mandatory notification to the ACCC.
The ACCC review process will depend on the facts of the matter. The review may potentially take several months and is more likely to be prolonged where the regulator sees that the purchase has the potential to substantially lessen competition.
The new regime will come into effect from 1 January 2026, although parties will be able to make voluntary notifications of proposed mergers from 1 July 2025.
Aintree Group Legal will be happy to discuss all of your commercial law needs. Contact us today.
