The new order begins: Merger Clearance Reform passes Parliament

Last night Federal Parliament passed legislation to establish a new mandatory and suspensory merger clearance regime.

After public consultation and consideration by the Senate Economics Legislation Committee, the Treasury Laws Amendment (Mergers and Acquisitions Reform) Bill 2024 was passed unamended.

On 1 January 2026, ACCC clearance will become mandatory for certain transactions meeting monetary thresholds (or other specific industry thresholds). With limited transitional arrangements in place, M&A activity throughout 2025 will be impacted and parties should start considering the possible impact of the regime now to avoid delays and execution risks for deals announced or signed in 2025.

As detailed in our previous alert, the new regime will replace the existing voluntary ‘informal clearance’ model and the formal merger authorisation pathway with an administrative clearance regime, which deems transactions that meet the notification thresholds as void unless they receive ACCC clearance, and introduces statutory timeframes, prescribed filing requirements, and changes the legal test and threshold for ACCC clearance.  

What's next?

Transitional arrangements and the impact on M&A in 2025

ACCC clearance will become mandatory from 1 January 2026 for all notifiable transactions meeting the monetary thresholds (including transactions that were announced or signed in 2025, but are yet to close as of 1 January 2026).

M&A parties need to give careful consideration to the transition provisions and application of the new regime to avoid delays and execution risks to deals signed in 2025. 

What does this mean for deals in the next 12 months?

1. Clearance pathways need to be considered. Transactions which may complete after 1 January 2026 (or in H2 2025 with a risk of delay) will need to be carefully considered to avoid a double-filing.

The transitional arrangements between the old and new regimes are limited:

• clearance under the current regime received before 1 July 2025 will not provide a legal exemption from the new merger clearance regime (and so any deals that receive clearance before 1 July 2025 will need to complete before 31 December 2025 to avoid having to re-file or apply for a wavier under the new regime)
• clearance under the current regime received between 1 July 2025 and 31 December 2025 will provide a legal exemption from the new merger clearance regime, provided the deal completes within 12 months of clearance (although there are open questions around what constitutes ‘clearance’ under the current regime for this purpose)
• clearance under the new regime – which opens for voluntary notification on 1 July 2025 – may be an attractive route for deals with long completion timeframes or which are likely to involve a lengthy ACCC review process, as informal clearance regime closes on 31 December 2025, with no transitional arrangements for transactions that are still in the informal clearance process at that time.

2. Preparing for the new regime. There are several steps we can help businesses to take over the next 12 months in preparation for the new regime:

• reviewing acquisition pipelines and the sequencing of potential M&A, particularly in the context of the 3-year ‘lookback’ mechanism in the new law (as detailed in our previous alert)
• assessing the transactions likely to be captured, including whether the control test is met, mapping the thresholds against company and group turnover, and analysing whether the ‘jurisdictional nexus’ is established
• assessing acquisitions over the past 3 years to establish their relevance to the expected notification thresholds and the ACCC’s substantive competition assessment
• considering the broader impact of a fully public notification regime, including developing strategies for competitive bid scenarios and hostile takeovers, and preparing for any impact on disclosure requirements for listed companies
• developing transaction document terms (including conditions precedent) to reflect the new law, and considering negotiating positions in the context of the transitional period
• getting a head start on preparing data and analyses expected to be required under the new filing rules, to avoid delays at filing time.

Finalising the details of the new regime

While the Bill has now passed Parliament, here’s what you can expect to see over coming months as the details of the new regime take shape:

• Q4 2024 – Q1 2025:
  • Consultation on timelines, fees, procedural safeguards
  • ~27 legislative instruments are to be implemented, including on key matters such as the filing thresholds and any targeted industry rules
• Q1 2025: ACCC to consult on draft process guidelines, analytical guidelines and notification forms
• Q2 2025: ACCC to publish guidance on the transitional arrangements, including engagement with merger parties and stakeholders on what to expect in the lead up to the start of the new regime.

Overview of changes