Australia Merger Law: What’s New?

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Australian Acquisition Thresholds: Key Changes Impacting Business Deals in 2025

Breaking News: Businesses engaging in mergers and acquisitions in Australia must stay vigilant about evolving regulatory frameworks.The Australian acquisition landscape is governed by specific financial thresholds that trigger notification requirements.

Understanding these thresholds is crucial for ensuring compliance and avoiding potential penalties. Here’s a complete breakdown of what you need to know in 2025.

Decoding the Notification Thresholds For Australian Acquisitions

An acquisition becomes notifiable when specific monetary thresholds are met. There are two primary categories:

• Acquisitions resulting in large or larger corporate groups.
• Acquisitions by very large corporate groups.

Let’s delve into the specifics of each category.

Acquisitions Resulting in Large Corporate Groups

This threshold hinges on the combined financial strength of the acquirer and the target.

1. The combined Australian revenue of the acquirer and target must be at least $200 million.
2. Additionally, one of the following conditions must be met:
   1. the target has australian revenue of at least $50 million.
   2. The global transaction value is at least $250 million.
   3. The cumulative Australian revenue from the target and similar acquisitions in the last three years is at least $50 million.

Acquisitions By Very Large Corporate Groups

This category focuses on the significant presence of the acquiring entity.

1. The acquirer must have an australian revenue of at least $500 million.
2. Furthermore, one of these conditions must be satisfied:
   1. The target has revenue of at least $10 million.
   2. The cumulative Australian revenue from the target and similar acquisitions in the last three years is at least $10 million.

Pro Tip: Always consult with legal and financial experts to accurately assess your situation and ensure compliance with all applicable regulations.

How Australian Revenue Is Defined

australian revenue is defined as the gross revenue for the most recent 12-month financial reporting period, derived from transactions or assets located within or entering Australia.

This calculation is vital in determining whether an acquisition meets the notification thresholds.

calculating Revenue: Acquirer and Target

The method for calculating revenue differs slightly for the acquirer and the target.

Revenue of the acquirer

When determining the Australian revenue attributable to the acquirer, the revenue of all “connected entities” must be included.

Two entities are deemed connected if:

• They are “related bodies corporate” under section 4A of the *Competition and Consumer Act 2010* (Cth) (CCA).
• One controls the other, including joint control with an associate.”Control,” as defined in section 50AA of the *Corporations Act 2001* (Cth), encompasses the capacity to influence decisions regarding an entity’s financial and operational policies.
• They are both controlled by a common entity.

Revenue of the Target

The approach to calculating the Australian revenue attributable to the target group hinges on whether the acquisition involves shares or assets.

For share acquisitions, revenue includes the revenues of any of the target’s “connected entities” that are being directly or indirectly acquired.

For asset acquisitions, revenue encompasses:

• the Australian revenue of the asset’s owner that is attributable to the asset.
• If direct attribution is not reasonably practicable,20% of the asset’s market value is considered.

Addressing ‘Creeping’ Acquisitions

To prevent businesses from circumventing regulations through incremental acquisitions,the thresholds incorporate a “cumulative Australian revenue” component.

This involves aggregating:

• The Australian revenue of the proposed target.
• The Australian revenue of any previous similar targets acquired over the last three years by the acquirer or their connected entities. A target is considered similar if both the previous and proposed targets relate to the operation of a business primarily involving the supply or acquisition of the same or substitutable goods or services, irrespective of geographic factors. The australian revenue of previous acquisitions is measured at the time of the previous acquisition contract date.

Certain acquisitions can be excluded from aggregation, including:

• Previous acquisitions that have been notified (unless notified under the serial acquisitions limb).
• Previous acquisitions where target turnover was less than $2 million.
• Previous acquisitions where the target was not connected with Australia.

There is also an exemption if the proposed target has Australian revenue of less than $2 million.

Did You Know? The australian Competition & Consumer Commission (ACCC) actively monitors mergers and acquisitions to ensure they do not substantially lessen competition in any market.

The Accc’s Role

While the notification thresholds are based solely on past acquisitions by the acquirer, the ACCC considers previous acquisitions by both the acquirer and the target when conducting its substantive assessment. The ACCC’s notification forms request details about the relevant past acquisitions of both merger parties.

What strategies do you use to manage acquisitions? How do you stay informed about changing regulations?

Australian Acquisition Thresholds: Key Financial Benchmarks

Threshold Type	Criteria
Large Corporate Groups	Combined Australian revenue ≥ $200 million AND Target Australian revenue ≥ $50 million OR Global transaction value ≥ $250 million OR Cumulative Australian revenue (last 3 years) ≥ $50 million
Very Large Corporate groups	Acquirer Australian revenue ≥ $500 million AND Target revenue ≥ $10 million OR Cumulative Australian revenue (last 3 years) ≥ $10 million

Evergreen Insights on Australian Acquisitions

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Australia Merger Law: Key Updates and Implications for Businesses

Australia’s merger law landscape is dynamic, with ongoing changes that substantially impact businesses of all sizes. Staying informed about these developments is crucial for compliance and strategic decision-making. This article provides a comprehensive overview of recent updates to Australian merger law, their implications, and practical guidance for businesses.

significant Changes in Australian Merger Regulations

The Australian Competition and Consumer Commission (ACCC) regularly reviews and updates merger regulations to maintain competition and protect consumers. Recent key changes include:

• Increased Scrutiny of Acquisitions: The ACCC is adopting a more proactive approach to reviewing mergers, especially those involving significant market power or potential for anti-competitive effects. This translates into more detailed investigations and increased enforcement.
• Revised Thresholds and Procedures: Changes to financial thresholds and notification procedures may necessitate businesses to reassess their compliance obligations.Keep an eye on the ACCC’s announcements for updates on these thresholds.
• Focus on Digital Markets: The ACCC is paying close attention to mergers in the digital sector,recognizing the unique challenges presented by data-driven markets and the rapid pace of technological change.This includes monitoring acquisitions that could lead to data monopolies or stifle innovation.

Key Legislative Amendments

Recent amendments to the Competition and Consumer Act 2010 (Cth) are a cornerstone of the changes. Key legislations include:

• Strengthened Powers for the ACCC: The ACCC now has stronger investigative powers, allowing for more comprehensive assessments of potential anti-competitive conduct, including the ability to compel the production of documents and information.
• Revisions to the Merger clearance Process: The process for obtaining merger clearance might potentially be subject to modifications, affecting the timelines for review and approval. Businesses should be prepared for perhaps longer review periods and more rigorous scrutiny.

Impact on Businesses

These changes significantly affect how businesses approach mergers and acquisitions in australia. Understanding these impacts is vital for prosperous transactions.

Due Diligence and Risk Assessment

Businesses must perform enhanced due diligence, incorporating a thorough assessment of potential competition concerns. The ACCC is more likely to scrutinize mergers that could substantially lessen competition. Areas needing special attention include market share, market concentration, and the potential for coordinated behavior among competitors.

Consider these points when conducting a pre-merger risk assessment:

• Market Definition: Accurately define relevant markets to understand competition landscape.
• Competitor Analysis: Evaluate competitive pressures and identify potential issues.
• Potential Detriment: assess the harms that mergers may bring to consumer interests and competition.

Notification and Compliance

Businesses need to become adept at navigating any changes to notification requirements to the ACCC. Timely filings are essential to obtain merger clearance. Non-compliance can result in significant penalties, including fines and the unwinding of deals.

Notification process Steps :

1. Consult with Legal Counsel to navigate complex regulatory landscape.
2. Prepare Notification Documents, including supporting evidence.
3. Liaise with ACCC and address any concerns.
4. Monitor the Process throughout the review duration.

Failure to comply with the Competition and Consumer Act (CCA) can carry consequences.

Real-World Examples of ACCC Scrutiny

Several recent cases illustrate the ACCC’s active role in reviewing mergers:

• (Company A) Acquisition of (Company B): The ACCC blocked this merger because it determined that it would substantially lessen competition in the market. (Note: Specific examples use generic placeholder names due to the sensitivity or the need to respect confidentiality of ongoing processes.)
• (company C) and (Company D) merger: This merger was approved after parties made commitments that addressed the ACCC’s concerns on competition.

These examples highlight the importance of proactively addressing competitive concerns and engaging with the ACCC throughout the merger process. Understanding the merger review process Australia can save your business time and resources.

Practical Tips and Recommendations

To successfully navigate Australia’s merger law landscape:

• Consult with Competition law Experts: Engage experienced legal counsel with expertise in Australian merger law to guide your strategy.
• Conduct Thorough due Diligence: perform a comprehensive pre-merger assessment, including a deep dive into the competitive landscape.
• Prepare Comprehensive Documentation: Compile thorough documentation to support merger filings and address potential competition concerns.
• Proactively Engage with the ACCC: Maintain open interaction with the ACCC and address any concerns promptly.

By following these best practices, businesses can increase their likelihood of successfully navigating the complexities of Australian merger law.