Australia’s New Merger Laws Are Now in Force: What Business Owners Need to Know

Australia’s New Merger Laws Are Now in Force: What Business Owners Need to Know

Home » Vicki Yeung

Australia’s New Merger Laws Are Now in Force: What Business Owners Need to Know

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3 min read

10 Sep 2026

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    Key Takeaways
  • ࠂ
    Mandatory ACCC notification has applied since 1 January 2026 to acquisitions that meet the relevant thresholds and are not exempt.
  • ࠂ
    Further requirements for certain asset acquisitions and share acquisitions resulting in specified voting-power increases commenced on 1 April 2026. The voting-power requirements apply only where the general notification thresholds are also met.
  • ࠂ
    A notifiable acquisition cannot be completed until ACCC approval is obtained or a notification waiver is granted.
  • ࠂ
    The Phase 1 notification fee is $56,800 for 2026-27, while Phase 2 fees can be significantly higher.
  • ࠂ
    Early advice can help businesses work out whether notification is required and build realistic timing and costs into the deal.

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Australia’s merger laws changed significantly on 1 January 2026. For acquisitions that meet the notification thresholds, businesses must now notify the Australian Competition and Consumer Commission (ACCC) and obtain clearance before the deal can proceed.

Since the new regime began, further asset and voting-power thresholds have commenced and the ACCC has updated its guidance based on the first months of operation. If you are buying a business, shares or assets, merger clearance now needs to be considered early - not just before completion.

What’s Changed on 1 January 2026?

Australia moved from a largely voluntary merger clearance system to a mandatory regime. If an acquisition is within scope, meets a notification threshold and no exemption applies, the parties must notify the ACCC and wait for clearance before completing.

The rules apply broadly to acquisitions of shares and assets. They can also capture a series of smaller acquisitions over time.

New from 1 April 2026: asset and voting-power thresholds

The merger regime was expanded further on 1 April 2026, introducing additional notification requirements that businesses need to consider when assessing a proposed acquisition. These changes apply to:

  1. Certain asset acquisitions

Some acquisitions of assets that do not comprise all or substantially all of a business may now require notification where the relevant acquirer-revenue and transaction-value thresholds are met.

  1. Changes in voting power

Additional rules can apply to certain increases in voting power. The precise trigger differs according to the type of target entity, the acquirer’s existing voting power and whether the acquirer controls the target. For example, this can include an increase from 20% or less to more than 20% in an unlisted company that is not widely held, or an increase from more than 20% but less than 50% to 50% or more in a body corporate. Not every increase in voting power above 20% automatically requires notification.

Do You Need to Notify the ACCC?

The thresholds are not simply a single dollar test. The main tests are generally summarised below:

Threshold When it may apply Key figures
Large merged firm The combined Australian revenue of the parties is substantial and the target revenue or transaction-value limb is met. Combined Australian revenue of at least $200m AND the:·         target Australian revenue is at least $50m; OR·         global transaction value is at least $250m
Very large acquirer A very large Australian business acquires a smaller target. Acquirer group Australian revenue is at least $500m AND target Australian revenue is at least $10m
Serial acquisitions Relevant acquisitions during the preceding
3 years may be aggregated where they predominantly involve the same or substitutable goods or services.Note: The ACCC’s August 2026 FAQs confirm that qualifying acquisitions completed before 1 January 2026 may be counted but acquisitions with target Australian revenue below $2m are excluded.
Ordinary $200m combined-revenue or $500m acquirer-revenue limb must still be met (subject to exclusions).  That is the accumulated target Australian revenue is at least $50m (large merged firm) or $10m (very large acquirer).
Certain asset acquisitions From 1 April 2026, some asset acquisitions that are not all or substantially all of a business can be caught. Applies where the acquirer group has Australian revenue of at least $200m AND:·         global transaction value is at least $200m; OR·         Australian revenue is at least $500m AND global transaction value is at least $50m

Important: Where one or more of the notification thresholds above are met, notification is only required if the target is connected with Australia and no exemptions apply.  Meeting a monetary threshold is only part of the analysis.  Every transaction needs to be considered on its own facts. The Australian connection, exemptions, transaction structure, voting power and previous acquisitions may also matter. 

What about Exemptions?

Some transactions are exempt even if a threshold would otherwise be met. Exemptions cover particular land and financial-market transactions, internal restructures, acquisitions by external administrators and other specified arrangements.

The practical message? Do not assume a deal is outside the regime because it involves assets, a minority interest or a smaller target. Check the rules early.

The Application Process

For a transaction that may need ACCC clearance, the process can be viewed in four steps:

 

ACCC-Flow-Chart

Which Pathway Should You Use?

For straightforward transactions, the ACCC says the short notification form will be appropriate in most cases. A long form is more likely to be needed where there is greater competition risk or complexity.

A notification waiver may be available for a transaction that technically meets a threshold but clearly does not raise material competition or consumer concerns. If granted, the waiver removes the obligation to lodge a formal notification. A waiver application is not simply a preliminary step before a formal notification, and businesses should choose the pathway that best fits the transaction. If the ACCC does not decide a waiver application within 25 business days, it cannot grant the waiver and is considered a deemed refusal.

Pre-notification discussions are optional but can be useful for complex deals or where the information requirements are unclear. The FAQs also confirm that parties may be able to notify on the basis of a sufficiently developed Heads of Agreement rather than waiting for every transaction document to be finalised.

How long can the ACCC review take - and what does it cost?

Stage Timing What it means 2026-27 fee
Pre-notification discussion No set timeline Allows parties to provide draft notification application and transaction documents to identify if further information is needed.ACCC recommends parties initiate this process at least 2 weeks before formal notification for acquisitions that clearly do not raise material concerns.If no determination is made in 25 business days, the application will be deemed to be denied. $8,300
Phase 1 Up to 30 business days* Initial review of application lodged.  Most transactions are expected to be resolved here. Earliest approval is generally in
15 business days.  Merger will either be cleared in this phase or progress to Phase 2.
$56,800
Phase 2 Up to a further 90 business days* A deeper review where competition concerns require further assessment. At the end, the merger can be put into effect with or without conditions or be blocked by the ACCC. $475,000 to $1.595m (additional fee, depending on transaction value)
Public-benefit application
(where available)
50 business days* Optional application. Only available after the ACCC has either not approved the acquisition or approved it subject to conditions. Must be made within 21 calendar days after the relevant ACCC decision. $401,000

* Statutory periods can be extended or adjusted in certain circumstances or unilaterally varied by the ACCC.

One Timing Trap to Remember

ACCC approval does not always mean the transaction can complete immediately. There is generally a 14-calendar-day period after the ACCC publishes its reasons before completion can occur, allowing time for an application to the Australian Competition Tribunal. An approved acquisition generally also needs to be completed within 12 months of the ACCC’s decision.

What’s Happening in Practice

The ACCC’s half-year results give businesses some useful comfort. From 1 January to 30 June 2026, it received 145 merger notifications and 286 notification waiver applications. It approved 115 notifications in Phase 1, with 6 notifications progressed to Phase 2 for a more in-depth assessment.

The ACCC also reported that 92% of acquisitions were decided within 20 business days through either an early Phase 1 decision or a notification waiver. That is encouraging, but businesses still need to allow time before lodgement to assess thresholds, prepare the application and deal with information requests.

Four Things to do Before Your Next Acquisition

1. Check the ACCC notification rules early, while the deal structure and timetable are still being developed.

2. Look at the parties’ Australian revenue, transaction value and relevant acquisitions made during the previous 3 years and consider whether the April 2026 asset or voting-power rules apply.

3. Build ACCC timing, fees and the post-approval waiting period into the transaction documents and completion plan.

4. Get advice before assuming an exemption or notification waiver will apply.

The Bottom Line

The new merger regime is now part of doing deals in Australia. For many acquisitions, the ACCC process will be straightforward. But if notification is required, getting the timing or threshold analysis wrong can delay completion and add significant cost.

The best approach is to consider merger clearance at the start of the transaction, so you know what is required before the deal gathers momentum.

Planning an Acquisition? Talk to Us Early.

If you are buying a business, shares or assets, getting the ACCC analysis right from the outset can save time, cost and uncertainty later.

Our Hillhouse Corporate & Commercial team can help you assess whether notification is required, identify the right ACCC pathway and structure the transaction around a realistic approval and completion timetable.

Contact Vicki Yeung, Senior Associate or Malcolm Chan, Associate, to discuss your proposed acquisition before you commit to the deal timetable.

E: vicki@hillhouse.com.au or malcolm@hillhouse.com.au

P: 07 3220 1144

This article is general information only and reflects the position as at September 2026. It is not legal advice. Merger notification requirements are transaction-specific and may change.

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Fact Sheet: Purchasing a Business

Fact Sheet: Purchasing a Business

Home » Vicki Yeung

FACT SHEET: Purchasing a Business

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3 min read

13 Mar 2026

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    Key Takeaways
  • ࠂ
    Due diligence is essential to understand a business’s financial position, liabilities, assets, contracts, and workforce before completing a purchase.
  • ࠂ
    Key legal and operational agreements must be carefully reviewed, including business structure, licences, leases, contracts, and employment obligations.
  • ࠂ
    Engaging experienced legal and financial advisors early helps identify risks, negotiate favourable terms, and ensure a smooth transition when acquiring a business.

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Buying a business can be a rewarding venture, but it also comes with a unique set of challenges and legal considerations. From ensuring compliance with industry regulations to navigating lease agreements and employment contracts, the process can be complex.

Whether you’re a seasoned professional expanding your current business or an entrepreneur investing in a new industry, understanding the legal landscape is crucial.

Our corporate and commercial legal team has extensive experience assisting clients with the purchase of businesses and has identified six key legal elements to consider when buying a business.

6 Key Legal Elements to Consider

  1. Due Diligence

When purchasing a business, conducting thorough due diligence is essential. This includes examining the businesses financial records and determining the value you place on the business having regard to it’s assets and profitability, identifying any outstanding liabilities, reviewing tenure the business has over any property and considering contracts that the business is a party to. It’s also vital to assess the assets of the business, such as equipment ownership, and to analyse client demographics, retention rates and levels of growth, which can significantly impact business value. Buyers also need to assess employment matters such as type and number of employees, rates of pay and accrued entitlements and future plans for any staff that are critical to the operation of the business.

  1. Business Structure and Licencing

The business structure is another critical consideration. You’ll need to decide whether to operate as a sole trader, partnership, company or trust. Additionally, reviewing all existing contracts is imperative, including supplier agreements, client subscription models, and restrictive covenants that could limit your ability to grow the business.

  1. Lease Agreements

Leasing arrangements are often a significant aspect of the purchase, especially if the business operates on leased premises. Carefully reviewing the lease agreement for assignment clauses or negotiating favourable terms, such as rent reductions or renewal options, can safeguard your investment especially if it has geographic goodwill or its location is vital to its operations. You may need to ensure that a business has long enough tenure for you to recoup your investment or require a contract to be conditional upon a new lease with longer tenure if there are issues on this front.

  1. Contracts and Agreements

Reviewing contracts, including supplier agreements, service contracts, and client subscriptions, is crucial to ensure smooth operations. Be mindful of restrictive covenants, such as noncompete clauses, that could limit your ability to grow the business.

  1. Employment and Staffing

Employment matters should not be overlooked. Reviewing existing employment contracts will help you understand obligations to staff, including liabilities for accrued leave or redundancy. Compliance with workplace laws and awards is critical to avoid future disputes and all employment agreements should be in line with National Employment Standards. If there are key staff that you need for the ongoing operation of the business, you may want to add contractual conditions around their continuing employment with the business.

  1. Goodwill and Intellectual Property

Finally, intellectual property and goodwill - are key assets in any business - must be carefully evaluated. It’s important to confirm the ownership and transferability of branding, software, and other intellectual property, as well as assess the value of goodwill associated with the business’s reputation and client base.

Tips for Success

To maximise your chances of success, engage legal and financial experts early in the process - ideally those with extensive experience in business acquisitions. Their expertise can help you identify potential risks and negotiate favourable terms. Securing transition support from the current owner can also ensure continuity of operations, stability of revenue and client/customer retention during the handover period. Additionally, verifying the accuracy and completeness of client records is critical for maintaining strong customer relationships. We encourage you to choose advisors who work together on this front so you are getting advice that is seamless and consistent.

Common Pitfalls to Avoid

One of the most common pitfalls is failing to uncover undisclosed liabilities, such as hidden debts or legal disputes tied to the business. Entering a lease with unfavourable terms or excessive rental costs can also negatively impact profitability. Overpaying for goodwill or intangible assets without proper assessment is another frequent mistake. It’s equally important to confirm the business complies with all regulatory requirements and to address restrictive covenants in existing agreements that could limit your operations.

How Hillhouse Legal Partners Can Help

At Hillhouse Legal Partners, we provide tailored legal services to support your business acquisition. Our team conducts comprehensive due diligence, ensuring transparency and identifying risks early. We help establish the most suitable business structure for your needs, review and negotiate contracts, and ensure regulatory compliance.

Our expertise extends to navigating lease agreements, safeguarding your rights as a tenant, and assisting with employment matters to ensure a seamless transition. Should any disputes arise during the process, we’re equipped to provide practical solutions to resolve them quickly.

We also work closely with your other advisors such as accountants, financial planners, finance brokers and bankers to ensure that you obtain holistic advice that puts you in the best position to succeed with your proposed business investment.

Experienced Team

At Hillhouse Legal Partners, our team has extensive experience advising business owners, investors, and entrepreneurs across all stages of a business’s lifecycle - from start-up and structuring to growth, compliance, succession, and transactions. We understand the legal and commercial complexities involved in business acquisitions and provide tailored support to help clients navigate the process and achieve a smooth and successful transition.

Let our experienced team guide you through the complexities of buying a business, so you can focus on what matters most: running a successful business.

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Changes to ATO Clearance Certificates

Changes to ATO Clearance Certificates

Home » Vicki Yeung

Changes to ATO Clearance Certificates

Author: Vicki Yeung

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3 min read

28 Mar 2025

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    Key Takeaways
  • Requirements of the Foreign Resident Capital Gains Withholding (FRCGW) have changed since 1 January 2025.
  • All property sales and certain disposals in Australia are now subject to FRCGW.
  • Australian resident sellers must obtain and provide an ATO Clearance Certificate at or before settlement.
  • Buyers who do not receive a clearance certificate by settlement must withhold 15% of the property value and remit this amount to the ATO or face penalties.

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Changes to ATO Clearance Certificates

The Australian Taxation Office (ATO) has introduced changes to Clearance Certificate requirements for property sales, effective from 1 January 2025. These changes impact all Australian residents (for tax purposes) who are selling or disposing of real property.

To ensure compliance, sellers must obtain an ATO Clearance Certificate and provide it to the buyer at or before settlement. If the seller does not provide this certificate, the buyer or lessee may be required to withhold part of the purchase price and pay it to the ATO. These rules are designed to ensure that foreign residents meet their capital gains tax obligations when selling Australian property.

Previous Requirements for Foreign Resident Capital Gains Withholding

The FRCGW rules were introduced on 1 July 2016 and applied to property transactions valued at $750,000 or more. These rules applied to various property dealings, including:

  • Vacant land.
  • Residential and commercial properties.
  • Certain leases over real property.
  • Other transactions involving Australian property.

In respect to the sale or transfer of property, FRCGW applies unless the seller could prove they were an Australian resident for tax purposes. To do this, sellers had to provide from the ATO either:

  • a clearance certificate for an Australian resident; or
  • a variation notice for a foreign resident.

If neither document was provided, buyers were required to withhold 12.5% of the purchase price and pay it to the ATO.

Changes Effective from 1 January 2025

The ATO has updated the FRCGW requirements to address concerns that the previous withholding rate did not adequately reflect capital gains tax obligations for foreign residents. As a result, the following changes have been introduced:

  • The threshold has been reduced from $750,000 to $0, meaning all property sales, regardless of value, are now subject to withholding.
  • The withholding rate has increased from 12.5% to 15% of the sale price or if the transaction is not at arm’s length, the market value.

These changes apply to all contracts entered into on or after 1 January 2025.

Importance of ATO Clearance Certificates

All sellers should apply for an ATO Clearance Certificate before settlement to ensure compliance with these new rules.

If a buyer does not receive the certificate at or before settlement, they must withhold 15% of the purchase price and remit it to the ATO.  Buyers who fail to withhold the required amount may face penalties (of up to $3,300 as at the date of this article), along with potential interest charges.

This requirement applies even if the seller is an Australian resident but:

  • did not apply for an ATO Clearance Certificate; or
  • failed to provide the certificate to the buyer before settlement.

To reclaim the funds withheld, a seller will need to wait until they lodge their income tax return for a financial year.  This can impact financial plans, particularly for those who intend to use the funds immediately after settlement.

Key Considerations for Sellers

  • Apply early: Most ATO Clearance Certificate applications are processed within a few days, but some may take up to 28 days.
  • No need to wait for a sale: Clearance Certificates are valid for 12 months, so sellers can apply before listing their property.
  • Increased withholding: Failure to provide a certificate by settlement will result in a 15% withholding, even if the seller is an Australian resident.

By obtaining an ATO Clearance Certificate in advance, sellers can avoid unnecessary delays and ensure a smooth settlement process.

For further guidance on how these changes affect your property sale, contact Hillhouse Legal Partners.

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