Free world needs regulation to ensure that free world remains free | Australia’s new Mandatory merger control regime

On 10th  October 2024,  the Australian government introduced a new legislation titled Mergers and Acquisitions Reforms Act, 2024. With effect from 1st January 2026, this new legislation replaces the old voluntarily reporting system to a new mandatory review process. This legislation comes after a three year campaign by the Australian Competition and Consumer Council (ACCC) to shift to a mandatory review process. This legislation is aimed to detect and mitigate anti-competitive mergers and acquisitions.

Currently, the ACCC operates on a voluntary review system which creates no mandating for authorisation from the council or to report transactions. The current system does give power to the ACCC to hold federal court proceedings in case the council finds discrepancies/issues in the voluntary review process. On the other hand, the new schemes make it mandatory for companies to disclose transactions relating to mergers & acquisitions. The new legislation have flagged certain transaction which shall be notifiable to the ACCC among others.

It is beside doubt that regulation is most needed in today’s free world to ensure that the free world actually remains FREE and the very first step in ensuring the same is to provide a free market and a free economy. This new legislation will ensure that the free world is upheld by preventing monopolistic practices, anti-competitive mesures and fostering competition. If the market remains unregulated then few players will dominate the market which will limit consumer preferences and soar prices.

A mandatory reporting regime will promote transparency which is essential to the functioning of a free market. The world with time is learning the importance of structural oversight and regulation to ensure open market and equal opportunity for all. There also have been steps taken by the European Union (EU) like establishing European Commission Merger Control (ECMC) to ensure open market in the EU. Furthermore countries like US and India have strong commissions like Federal Trade Commission (FTC) and Competition Council of India (CCI) respectively who are diligently working to ensure that the global market remains free and accessible to all.

The legislation recently passed by the Australian Parliament is not unprecedented on the global stage. In fact, many argue that Australia should have implemented such a framework much earlier, aligning itself with global standards in merger control. This new law marks a significant shift in the governance of the Australian economy, ushering in a more regulated and closely monitored competition environment than ever before which will remains free, open and accessible by all.