Under the Commerce Act, the Commerce Commission considers applications for the clearance of proposed mergers or acquisitions that might substantially lessen competition in a market, where the applicants wish to obtain protection from legal challenge either from the Commission or from other parties in the market.
The Commission has a standard application form for clearances. The form contains information about the application procedure and cost, and when completed, will provide the Commission with critical information to inform its analysis. Once the completed form is received with payment, the Commission then commences an investigative process including research and interviews with competitors, customers, suppliers and interested parties to the proposed acquisition.
Once the Commission has collected all the information relevant to the acquisition, it conducts legal and economic analysis (as outlined in the Mergers and Acquisitions Guidelines) to establish whether the transaction is, or is not, likely to result in a substantial lessening of competition. If the Commission cannot be satisfied that the acquisition would not result in a substantial lessening of competition it must decline clearance. If the Commission declines clearance, parties have the right to appeal the Commission’s decision to the High Court.
The Act specifies that the Commission should reach a decision on a clearance within 10 working days of its receipt, or a longer period as agreed with the applicant. The Commission's target timeframe for reaching decisions on clearances, as recorded in its Statement of Intent, is 40 working days. However, this timeframe is highly variable, dependent on the complexity of the clearance in question and the Commission's workload.
The Commission issues full written reasons for all its clearance decisions, as soon as possible after making its decisions. The Commission's priority is to make clearance decisions as swiftly as possible, to give businesses certainty, ahead of producing written reasons. This means it often takes several weeks for written reasons to be published after a decision has been made.
The Public Registers contain a full list of all applications for clearance received by the Commission, along with written reasons for the Commission's decisions. Click here to go to the Public Registers section.
The Commission appreciates advance notice of clearance applications. If you intend to apply for clearance, please advise the Manager, Market Structure Group - Ritchie Hutton on (04) 924 3642.