The Australian Competition and Consumer Commission (ACCC) today issued its revised Merger Guidelines 2008, replacing the Merger Guidelines 1999. The guidelines provide an outline of the broad analytical framework applied by the ACCC when assessing mergers under section 50 of the Trade Practices Act 1974, which prohibits mergers that would have the effect of substantially lessening competition in a market.
The updated guidelines are a better reflection of the approach being undertaken by the ACCC to merger reviews, however it is important to note that the approach taken in the revised guidelines is not significantly different from the approach contained in the 1999 guidelines –the competition test is the same and analysis of the market and merger factors remains a vital element in merger assessment.
The revised guidelines have, however, been developed with an increased emphasis on the competitive theories of harm and the effects of constraints which facilitates a more integrated analysis. Furthermore, the guidelines are in line with international best practice, contemporary views on anti-trust analysis and the ACCC's experience.
A draft of the revised Merger Guidelines was released for public consultation in February 2008, and there have been a number of changes made in response to input from the business and trade practices advisory community, their advisers and the public. The most notable of these is the simplification of the notification threshold the ACCC introduced to filter and thereby limit the merger reviews it conducts to those mergers which, in its view, may potentially raise competition concerns.
"The revised Merger Guidelines and the growing body of public competition assessments posted on the ACCC website, provide for greater predictability, transparency and certainty to merger parties, the business community, their advisers and the public," ACCC Chairman Mr Graeme Samuel said.
The ACCC will apply the revised Merger Guidelines flexibly and will continue to assess each merger on its merits according to the specific nature of the transaction, the industry and the particular competitive impact likely to result in each case.