Assistant Minister Andrew Leigh has overseen the biggest reforms to Australia’s merger system in 50 years. Photo: Michelle Kroll.
Interested parties have less than two weeks to contribute to the Federal Government’s consultation over a significant change to Australia’s company merger system.
The Australian Competition and Consumer Commission (ACCC) intends to charge fees for any reviews deemed necessary over entities seeking to merge.
While this would be a welcome move for taxpayers, who would not be lumped with the ACCC’s costs, companies might have different views with expected extra heavy costs added to their plans.
The government released its consultation paper on Thursday (5 June), seeking views on the proposed cost recovery fees framework under the new merger system.
The consultation period closes on 18 June.
The ACCC will review certain mergers as usual. But under the new framework, parties who notify the ACCC of these mergers will pay fees.
The type of review determines the fee amount.
Assistant Minister for Productivity, Competition, Charities and Treasury Andrew Leigh said the proposed cost recovery fees under the new merger system formed part of the biggest reforms to Australia’s merger system in 50 years.
“This reform will make our merger approval system faster, simpler, more targeted and more transparent,” Dr Leigh said.
“Under the new merger system, a mandatory notification system will apply for mergers above certain thresholds, with the Australian Competition and Consumer Commission to be the decision maker on approvals.
“The new system will make it easier for most mergers to be approved quickly so the ACCC can focus its resources on the minority that could pose a threat to competition.”
Dr Leigh said the change recognised most mergers had genuine economic benefits and were an important feature of any healthy, open financial system.
But it also acknowledged the risk of a small portion of mergers to cause serious harm to consumers and the wider economy if they were allowed to proceed without scrutiny.
The new merger system will come into effect from 1 January 2026; businesses can make voluntary notifications under the new regime from 1 July 2025.
“Merger reviews under the new system will be cost recovered,” Dr Leigh said.
“The fees have been calibrated to reflect the resources the ACCC needs to efficiently carry out an assessment, with the vast majority of mergers expected to be subject to low fees consistent with comparable jurisdictions.
“Currently, the cost incurred by the ACCC is funded by taxpayers rather than merger parties.
“The new merger system will embed cost recovery principles, meaning businesses that propose potentially risky mergers for assessment bear the cost they impose on the community to assess that risk, rather than taxpayers.”
Dr Leigh said the fees would also ensure the ACCC was appropriately resourced to undertake its “expert role and efficiently administer the new system”.
He said a fee exemption would be available for acquisitions by small businesses so charges were not a disproportionate burden.
The proposed change follows the enactment of the Mergers and Acquisitions Reform Act 2024 late last year.
The government insists the plan to impose fees will help recover the costs of running merger reviews and its ability to perform its new decision‑making role under the new legislation.
The joint Treasury and ACCC consultation paper details the plan.
“Charging fees by the type of review allows merger applications to be charged based on their complexity and the competition risk,” the paper states.
“This ensures only the highest-risk mergers incur high fees – reflecting the significant resourcing required to assess these mergers – while ensuring the vast majority of mergers can be assessed quickly at minimum cost to parties…
“Importantly, the fees have been designed to be simple and straightforward for business and the ACCC to ensure minimum regulatory and administrative burden in relation to merger reviews and allow for transparent reporting by the ACCC.”
Consultation is available on the Treasury website.
Original Article published by Chris Johnson on Region Canberra.
