Under section 69A of the Commerce Act 1986, the Commission is able to accept structural divestment undertakings from an applicant in respect of the clearance of a business acquisition. The purpose of divestment undertakings is to remedy the competition concerns raised by the proposed acquisition while also allowing the merger to proceed with its potential benefits and efficiencies.
These guidelines relate to applications for clearance and aim to:
- ensure that applicants are fully informed of the Commission's approach for assessing divestment undertakings;
- ensure that applicants provide the Commission with sufficient and relevant information to enable the Commission to expeditiously consider a divestment undertaking; and
- provide a single source of guidance on the Commission's approach to assessing divestment undertakings.
These guidelines reflect the Commission's current approach for assessing divestment undertakings. The Commission's practice will continue to develop in light of judicial precedent, general practice and experience. These guidelines may, in due course, be supplemented, revised or replaced.
Although they cover the main process issues for businesses and their advisers, these guidelines are not intended to cover every issue that may arise. They are not intended to be:
- a binding statement of how discretion will be exercised in a particular case;
- a substitute for legal advice; or
- a restatement or definitive interpretation of law.
Anyone in doubt about whether to offer a divestment undertaking when submitting an application for clearance should consider seeking legal advice.
These guidelines should be read alongside the Commission's Mergers and Acquisitions Guidelines and the Merger and Acquisition Clearance Process Guidelines.