The ACCC’s mandatory merger regime: a strategic paradigm shift for property and real estate transactions

Effective 1 January 2026, the Australian Competition and Consumer Commission (ACCC) will enforce a mandatory merger notification regime, marking a fundamental transformation in Australia’s competition regulatory framework. It is critical to understand and engage with the process to avoid any delays and enable a considered approach to be adopted. This regime, the first of its kind in Australia’s property and real estate sector, introduces pre-transaction clearance requirements that significantly alter the landscape for acquisitions involving substantial real estate assets or larger businesses.

Comprehensive Evolution of Australia’s Merger Control Framework

Until now, Australia’s merger control operated on a voluntary notification basis: parties could notify the ACCC of proposed mergers and acquisitions but were not compelled to do so prior to completing transactions. This regime, while effective in many respects, relied on the ACCC’s post hoc intervention to challenge anti-competitive conduct after transactions closed. The inherent limitation was the risk of  ‘creeping acquisitions’ — where incremental purchases potentially undermined competition before the ACCC could intervene.

The new mandatory merger notification regime eradicates this reactive posture, introducing a suspensory requirement that freezes transactions exceeding defined monetary thresholds until regulatory clearance is obtained. This proactive oversight aligns Australia with other international jurisdictions, where mandatory pre-merger notifications and suspensory holds are well-established.

Key Features and Expanded Implications

1. Mandatory Pre-Transaction Notification and Clearance

Under the new framework, any acquisition of Australian real estate assets exceeding specified monetary thresholds must be notified to the ACCC before completion. The thresholds are primarily turnover and asset value-based, designed to capture transactions with the potential to substantially lessen competition.

2. Suspensory Effect

Once notified, parties are prohibited from completing the transaction until the ACCC grants clearance. This “pause” in the transaction protects competitive market structures by preventing irreversible acquisitions that may later be found anti-competitive.

3. Thresholds and Scope

The monetary thresholds are designed to balance regulatory oversight with market efficiency, but their application introduces complexity. For instance, thresholds apply not only to direct acquisitions of real property but also, in many cases, to lease transactions, acquisitions of land development rights, and other indirect acquisitions such as units or shares in certain landholding trusts or companies. However, there are exemptions for certain land related acquisitions including:

• acquisitions of land aimed at developing residential premises, or by businesses primarily engaged in buying, selling, or leasing land where the acquisition is for a purpose other than operating a commercial business on the land; and
• acquisitions of interest in entities whose non-cash assets comprise solely of land assets referred to in paragraph (a); and
• some lease extensions or renewals; and
• interests relating solely to a sale and leaseback arrangement.

The monetary thresholds are described as follows:

 

Threshold Category	When It Applies	Key Criteria
Combined Turnover ≥ A$200m	Applies to acquisitions of shares or assets (including real estate) connected with Australia	Combined Australian turnover of purchaser group and target group ≥ A$200m. Either: a) the Australian turnover of the target group  ≥ A$50m, or b) the global transaction value  (being the market value or consideration) of the transaction ≥ A$250m
Large Purchasers	Applies to acquisitions by large businesses	Purchaser group’s Australian turnover ≥ A$500m and The Australian turnover of the target group  ≥ A$10m
Major Supermarkets	Applies to Coles and Woolworths and their connected entities	Additional rules apply even if the above thresholds are not met Includes acquisitions of land or landholding entities where there is: commercial buildings with a gross lettable area > 1,000 sqm, or non-commercial buildings with an area > 2,000 sqm, and the land is not being used, or intended to be used, to operate a supermarket business.
Serial Acquisitions	Applies to cumulative acquisitions over 3 years, that were not otherwise notified under the above, or voluntarily notified	Either: Combined Australian turnover of purchaser group and target group ≥ A$200m; Cumulative turnover from acquisitions by the Purchaser group relating to businesses that predominantly involve the same, substitutable or competitive goods or services over the past 3 years is ≥ A$50m; OR Purchaser group’s Australian turnover ≥ A$500m; and Cumulative turnover from acquisitions by the Purchaser group) relating to businesses that predominantly involve the same, substitutable or competitive goods or services over the past 3 years is ≥ A$10m. Prior small acquisitions (turnover < A$2m) are excluded.

4. Dual Regulatory Coordination

The ACCC’s regime is designed to operate concurrently with Australia’s Foreign Investment Review Board (FIRB) process. Transactions involving foreign investors will face simultaneous but distinct reviews, each with its own requirements and timelines. This dual framework will require strategic coordination to avoid protracted delays or conflicting conditions.

5. Review Periods and Fees

The ACCC’s review comprises a 30-business day initial assessment (Phase 1), extendable by an additional 90-business day in-depth investigation (Phase 2). Accompanying these procedural requirements are notification fees, ranging from A$8,300 (for a  notification waiver), A$56,800 (for Phase 1), and an additional A475,000 to A$1,595,000 for a complex Phase 2 review , supplemented by legal, advisory, and compliance costs.

Strategic Imperatives for Market Participants

Given the complexity and risks introduced by the mandatory notification regime, market participants should adopt a considered approach including:

• Early Legal Consultation: Engage competition law specialists at the deal’s inception to evaluate notification obligations and exemption eligibility.
• Careful Deal Structuring: Assess the feasibility of indirect acquisitions or carve-outs to optimise outcomes without contravening the regime.
• Proactive ACCC Engagement: Initiate informal consultations or pre-notification discussions with the ACCC to clarify issues and mitigate review durations.
• Integrated Regulatory Planning: Synchronise FIRB and ACCC application processes to co-ordinate timelines and compliance.
• Robust Internal Controls: Implement transaction compliance protocols to identify potential notification triggers early and ensure procedural adherence.

Conclusion: Embracing the Paradigm Shift?

A significant number of sources have serious concerns regarding uncertainties, inconsistencies, and a lack of clarity — particularly regarding the ACCC’s application for exemptions. At a time when productivity is at the forefront of Government and businesses’ mindset, the new mergers and acquisitions regime, will introduce even more red tape, complexity, increased costs and delays. These issues conflict with the LFRA’s core values of clarity, consistency, and certainty, and are likely to negatively impact levels of productivity within our sector.

 

Briony Kerr, Partner, Moray & Agnew