Jurisdiction - Australia
Reports and Analysis
Australia – The ACCC’s New Informal Merger Review Process Guidelines.

4 November, 2013

 

WHAT YOU NEED TO KNOW

 

  • The ACCC has released its Informal Merger Review Process Guidelines (in September 2013), replacing its previous guidelines dated July 2006.

 

  • The Guidelines provide greater clarity on some issues, including pre-assessment and confidential review, but do not make major changes.
 

1. Pre-Assessment For A Non-Contentious Merger (Approx 2 Weeks Duration): The Guidelines set out (or “formalise”) the ACCC’s process for “pre-assessing” a merger, without conducting a confidential or public review. The ACCC may pre assess a merger where it considers that there is a low risk that the merger will result in a substantial lessening of competition. Where the ACCC determines that it is unable to pre-assess a merger, it will proceed to the confidential or public review phase.


2. Confidential Review (Approx 2-4 Weeks Duration): Where a merger is confidential and cannot be cleared at the pre-assessment stage, the ACCC can conduct a confidential review at the request of the parties. If possible, the ACCC will provide a conditional, confidential view to the acquirer.


3. Revised Indicative Timeline: The Guidelines set out the revised indicative timeline, and state that while a timeline may be extended for a merger that is complex or raises competition concerns, most mergers that do not raise substantive competition concerns will be cleared within 8 weeks. The ACCC will initially provide an indicative timeline with a “provisional” decision date, which it will revise to a “proposed” decision date following market inquiries and any response from the merger parties. An overview of the informal merger review process and typical duration is set out on page 3.


4. Market Inquiries: The ACCC will generally provide the merger parties with written details of any relevant issues or concerns arising during market inquiries. The merger parties may respond to those issues or concerns, usually within 1-2 weeks.


5. Opposition Without A Statement Of Issues (SOI): In limited circumstances, the ACCC may oppose a merger without releasing a SOI. For example, where substantial information received during market inquiries enables the ACCC to form the view that the merger is likely to substantially lessen competition, and it is clear that a SOI will not provide significant new information. In these circumstances, the ACCC will inform the merger parties that it intends to make a final decision and will not be releasing a SOI. The merger parties will be given an opportunity to respond to issues and concerns arising from market inquiries.


6. Public Competition Assessment (PCA): The ACCC will publish a PCA “as soon as practicable” after its decision and will aim to do so within 30 business days of making a decision. The ACCC may delay publication of the PCA where the merger becomes the subject of litigation. This is in contrast to earlier drafts of the Guidelines, which stated that the ACCC would generally delay release of a PCA where there is the prospect of litigation following an ACCC decision to oppose a merger.


7. Confidential Information: The Guidelines set out a standard form statement of the conditions on which the ACCC will receive confidential information. Where appropriate, the ACCC will seek confidentiality waivers to allow the exchange of confidential information with overseas regulators.


8. Cooperation With International Regulators: The Guidelines state that the ACCC may suspend review of a transaction in order to consult or coordinate review decision timing with an overseas competition regulator. Where merger parties provide undertakings to an overseas regulator to address competition concerns in that jurisdiction, the ACCC will generally require the merger parties also to provide undertakings to the ACCC, to ensure that the ACCC can enforce those undertakings.


9. Information Gathering: The ACCC will use its statutory information gathering powers only when it considers it will be the most effective and/or efficient way of gathering the information necessary for the ACCC to make its decision. The Guidelines do not mention the statutory precondition to the use of these powers, which requires that the ACCC has reason to believe that information/documents sought relate to a matter that may constitute a contravention of the Competition and Consumer Act 2010 (Cth).

 

Ashurst Logo

 

For further information, please contact:

 

Bill Reid, Partner, Ashurst
bill.reid@ashurst.com


Patrick Clark, Ashurst
patrick.clark@ashurst.com


Simon Hunt, Ashurst
simon.hunt@ashurst.com

 

Ashurst Competition & Antitrust Practice Profile in Australia

 

Homegrown Competition & Antitrust Law Firms in Australia

 

International Competition & Antitrust Law Firms in Australia

Comments are closed.