We report on the AP Eagers decision and its likely impact. Dr Ng also said merger approval gives the ACCC the chance to “nip in the bud” the potential of future misuse of market power by merged firms. AHG is Australia's largest car dealership group, with operations in NSW, Queensland, Victoria and Western Australia. Here are some of our stories. ACCC concerned Competition Tribunal's approval of $11b Tatts-Tabcorp merger could radically change competition hurdles for future deals. This set out its preliminary views on the proposed transaction. its Merger Guidelines of November 2008, the ACCC provides guidance as to when it would be prudent for the merger parties to seek clearance from the ACCC. This process is voluntary and non-suspensory. The ACCC "encourages" merger parties to notify a proposed merger in advance of completing it where (1) the products of the merger parties are either The ACCC found that a merger between NAB and AXA would result in a substantial lessening of competition in the market for retail investment platforms for investors with complex investment needs. Our people work with clients to solve their toughest problems, creating new ways forward to help them thrive. The ACCC's conditional authorisation determination was secured just short of the 90 calendar day statutory deadline. Watch on-demand webinars and register your interest for virtual events. Once approval from the two regulatory bodies is received the telcos expect the merger to be completed in mid-2020. The ACCC's interim Merger Authorisation Guidelines, released in late 2017, provide that the ACCC will take into account "any benefits that … The Australian Competition and Consumer Commission (ACCC) has updated the timeline for its decision on the Australian Finance Group’s (AFG) proposed merger with fellow aggregator Connective. The new merger authorisation process was introduced as a result of the Harper reforms, and became law in November 2017. Before the reforms were introduced, it was necessary to demonstrate the merger would deliver public benefits in order to seek authorisation. If the ACCC grants approval to the merger deal, it will result in the formation of an entity which will have a market cap of A$2.3 billion. Merger authorisation provides protection from legal action under section 50 of the Competition and Consumer Act. On February 18, the Irish Times reported that Flutter received informal approval for the deal. Accordingly, it is no longer possible for parties to apply directly to the ACT for authorisation. The ACCC can authorise a proposed acquisition when it is satisfied that the statutory test has been met. Informal Approval Granted. Most mergers are reviewed under the ACCC's. This means that merger parties may complete a proposed acquisition without first obtaining any competition approval from the Australian Competition and Consumer Commission ( ACCC ) or the Federal Court of … This is the first authorisation on the grounds that the merger (with the undertaking) did not substantially lessen competition, rather than on the basis of public benefits. The informal merger review process enables merger parties to seek the ACCC’s view on whether the proposed acquisition is likely to have the effect of substantially lessening competition. First ACCC merger authorisation – how does the AP Eagers decision affect you? Furthermore, a merger authorisation application may be approved if it does not substantially lessen competition or the public benefits outweigh any detriment to the public. assessment based on the information available to determine whether a public review will be required. In a media release issued yesterday, the ACCC announced that to aid with its approval… The new merger authorisation process has been used for the first time since it was introduced following the Harper Reforms in November 2017. This immunity bars the merger from being challenged so long as it is completed within a period of time determined by the ACCC. Mergers and acquisitions are important for the efficient functioning of the economy. Budde said that if the European telecommunications experience was anything to go by, the ACCC would have difficulty in regulating issues of collusion if the Vodafone and Hutchison merger was approved. However, the Competition and Consumer Act prohibits mergers that would have the effect, or be likely to have the effect, of substantially lessening competition in a market. The Committee is seeking approval from ACCC to allow existing shareholders and members of BPAY, eftpos and NPPA to acquire shares in the parent company, while keeping the three payment schemes as separate brands. Appearing before a parliamentary committee on Wednesday, Mr Sims said the controversial Nine-Fairfax merger, which the ACCC approved, was bad news for media diversity and demonstrated systemic flaws in the country’s legislation. Mergers and acquisitions can be important for the efficient functioning of the economy. AP Eagers is Australia's second-largest car dealership group, with operations in NSW, Queensland, Victoria, South Australia, the Northern Territory and Tasmania. However, the merger parties already bear the burden of proof in any deals where the parties seek a declaration from the Federal Court that the deal is not anticompetitive … The merger was granted pre-approval by the ACCC on January 20. The ACCC issued its authorisation determination on 25 July 2019, just 88 days after the application was lodged, which is within the 90 day statutory period in which it has to review a merger authorisation application. A feature of the formal authorisation is the public nature of the parties' and third parties' submissions (subject to confidentiality excisions). On the other hand, the ACCC found that an independent AXA or a merger between AMP and AXA would not have this effect. In the case of the proposed acquisition, the period of time is 12 months. The parties, as well as third parties, were invited to submit responses to this letter. Following those decisions, ACCC Chair Rod Sims expressed concerns about the courts’ approach to mergers and suggested that changes to the merger approval processes may need to be considered. Allens acted for AP Eagers. The organization has given informal approval of the merger, but it is just the first step in a long series of approvals needed by the company prior to the deal becoming finalized. The ACCC’s merger guidelines state that where the merger parties’ products are substitutes or complements and the merged entity’s market share will … Partner, Practice Group Leader, Competition, Consumer & Regulatory, Allens is an independent partnership operating in alliance with Linklaters LLP. However, the Competition and Consumer Act prohibits those mergers that would have the effect, or be likely to have the effect, of substantially lessening competition in a market. If you'd like to discuss the first use of the new merger authorisation process, please contact any of the people below. news The Australian Competition and Consumer Commission (ACCC) has announced it will not oppose the proposed acquisition of AUSTAR by FOXTEL, greenlighting the multi-billion dollar merger of the two pay TV giants and paving the way for Australia’s digital TV sphere to be re-shaped.. These priorities highlight the areas in which the ACCC will focus its litigation and enforcement activity over the next 12 months, some of which will continue the ACCC’s work from 2020. AP Eagers indicated that it did not consider that the proposed transaction would have the effect, or the likely effect, of substantially lessening competition in the supply of new cars in the Newcastle and Hunter Valley region; but, to address the ACCC's concerns, AP Eagers offered an undertaking to divest its dealerships in that region. Were the merger to … The public nature of the process contrasts with the informal merger review process, in which third party or market feedback is not directly conveyed to the merger parties, but summarised by the ACCC. The ACCC then invited submissions from more than 270 parties, receiving more than 20 public submissions, which were then published on its website (with confidential information redacted). Reinstating the ACCC's monopoly in merger approvals could see a return to pre-2007 days when the ACCC clearance process was the only practical option for parties to seek a merger approval. The firms are still working on the deal, as after the ACCC’s approval – which came down last week after a “Phase 2” review that lasted six months – the transaction still needs approval from the Australian Foreign Investment Review Board (FIRB) and Ruralco shareholders. The ACCC's guidelines provide that informal reviews where the transaction raises competition concerns can take up to 24 weeks, but in practice can take longer, particularly if undertakings are involved. Key areas of note are: 1. The reforms combined the previously unused formal merger clearance process with the previous process of merger authorisation by the ACT. Ross Gittins Economics Editor . The Federal Court on Thursday overturned a bid by the Australian Competition and Consumer Commission (ACCC) to block the merger from proceeding. They allow firms to achieve efficiencies and diversify risk across a range of activities. “Our merger laws couldn’t deal with it,” … ACCC loses the case. AP Eagers' application for ACCC approval is the first following reforms in 2017 to the merger authorisation process, which reinstated the ACCC's ability to consider applications for merger authorisation. granted conditional approval of the merger after the merger parties agreed to divest certain Mylan generic products across 20 countries in the European Economic Area and the United Kingdom. Most mergers are reviewed under the ACCC's informal merger review process, in which there are no statutory deadlines. “If you’re pre-assessing, it’s a pretty big deal,” Mr Sims said. A valid application for merger authorisation must be in the form approved by the ACCC and accompanied by the relevant fee. It was notified by the ACCC that it passed all of the requirements. An authorisation provides the merger parties with statutory immunity. Shareholders have responded positively to the ACCC's decision to not appeal the Federal Court's decision, with shares in TPG up 8.3 per cent at 10.33am AEDT, and shares in HTA up 11.33 per cent. While the informal process works well, and is likely to continue to be used in the vast number of merger clearances, authorisation is a viable alternative and we anticipate more companies may now look closely at the option of merger authorisation. ACCC approves Vodafone-3 merger By Brett Winterford on May 29, 2009 5:39PM Competition regulators have approved the merger of the Australian arms of mobile carriers Vodafone Australia and Hutchison 3. The ACCC has recently favoured either placing the burden of proof on the merger parties and/or introducing rebuttable presumptions that a deal is anticompetitive when it is opposed by the ACCC. Delivering his 10th annual CEDA address yesterday, Chair of the Australian Competition and Consumer Commission (ACCC), Rod Sims, announced the ACCC’s compliance and enforcement priorities for 2021. The corporate side of the deal is being handled by Allens for Nutrien and Gilbert + Tobin for Ruralco.. If a merger is implemented without or before ACCC approval (and the ACCC considers the merger breaches section 50 of the CCA) or after the ACCC has opposed the transaction, the ACCC can commence an action in the Federal Court, seeking either: An injunction to prevent a merger from proceeding. The ACCC’s investigation focused on competition in the supply of Australian IP services such as patents, trademarks, designs and plant breeder’s rights. 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In this case, the submissions (including the applicant's) were published on the ACCC's register, with confidential information redacted. The deal was conditional upon a number of matters, including securing ACCC approval or authorisation. Merger authorisation The ACCC can authorise a proposed acquisition when it is satisfied that the statutory test has been met. Interaction with FIRB approval and foreign jurisdictions One situation in which merger parties will find themselves unable to close without ACCC approval is where the proposed transaction is subject to Australian foreign investment approval from FIRB. Australia's informal merger clearance process is used in almost all mergers where approval is sought from the ACCC. Ruralco, Landmark merger approved by ACCC Beef Central, August 22, 2019 THE Australian Competition and Consumer Commission (ACCC) will not oppose the proposed acquisition of rural services company Ruralco (ASX:RHL) by Nutrien, which operates in Australia through its wholly owned subsidiary, Landmark. On 5 April 2019, AP Eagers launched an off-market takeover bid to acquire all the fully paid ordinary shares in AHG that it did not already own. The competition watchdog was initially scheduled to hand down its decision on 7 May but has now revealed that the provisional date for the announcement of its … ASX-listed AP Eagers Limited (AP Eagers) has secured the first formal merger authorisation from the ACCC under the new regime, in relation to its proposed acquisition of ASX-listed Automotive Holdings Group Limited (the proposed acquisition) (the parties).
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