Corporate acquisitions in Australia now come with a new line item for the deal spreadsheet: paying the competition regulator to review the transaction. It may not be as exciting as negotiating the purchase price, but it can be considerably more expensive than the celebratory champagne.
The Australian government originally proposed cost recovery fees as part of the country’s largest merger-control overhaul in decades. Instead of funding every merger assessment through general tax revenue, the new model requires businesses using the review system to cover much of the Australian Competition and Consumer Commission’s cost.
That proposal has since become a functioning part of Australia’s mandatory merger regime. The system began accepting voluntary notifications in July 2025 and became fully mandatory on January 1, 2026. Transactions meeting the applicable thresholds generally cannot close until the ACCC has approved them.
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For companies, private equity sponsors, investors, and advisers, the change is bigger than a filing fee. It alters transaction budgets, regulatory timelines, acquisition agreements, due diligence procedures, and the way boards evaluate competition risk. Australia has effectively replaced a largely voluntary process with a toll roadand complicated mergers may encounter several toll booths.
How Australia’s Merger Review System Changed
Before the reform, Australia did not generally require companies to submit every qualifying merger for advance approval. Parties could approach the ACCC through its informal clearance process, but notification was largely voluntary. The regulator could investigate and challenge a transaction, yet it did not automatically receive a filing whenever a deal crossed a standardized monetary threshold.
The government concluded that this structure left the ACCC without visibility into too many acquisitions. Particular concern surrounded serial acquisitions, sometimes called “creeping acquisitions,” in which a powerful company buys several smaller competitors or complementary businesses over time. Each deal may look modest when viewed alone, while the cumulative result can reshape an entire market.
Under the new mandatory and suspensory regime, qualifying acquisitions must be notified before completion. “Suspensory” means the parties must wait for clearance rather than close first and discuss competition concerns later. Attempting to complete a notifiable acquisition without approval can produce serious consequences, including financial penalties and the possibility that the transaction will be treated as legally ineffective.
What Cost Recovery Means
Cost recovery is based on a straightforward policy argument: the businesses proposing an acquisition should pay for the government resources used to assess it. Those resources may include ACCC case officers, economists, lawyers, market researchers, digital systems, outside experts, document management, stakeholder consultations, and preparation of a written decision.
The government’s model attempts to match the charge to the intensity of the review. A transaction that clearly presents little competition risk can pursue a relatively inexpensive waiver. A standard notification carries a larger Phase 1 fee. Deals that raise substantial questions and enter Phase 2 face much higher charges because the ACCC must conduct a more detailed investigation.
In theory, this prevents simple acquisitions from subsidizing complex ones. It also shifts a significant portion of merger-review expenditure away from taxpayers. In practice, however, it means that regulatory risk now has an immediate and highly visible price tag.
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Australia’s Merger Review Fee Structure
All figures below are in Australian dollars. The current published structure separates waiver applications, initial reviews, in-depth reviews, and public-benefit applications.
| Review Stage | Transaction Category | Fee |
|---|---|---|
| Notification waiver | Acquisition considered unlikely to require full notification | AU$8,300 |
| Phase 1 review | Standard merger notification | AU$56,800 |
| Phase 2 review | Transaction valued at AU$50 million or less | AU$475,000 |
| Phase 2 review | Transaction valued above AU$50 million and no more than AU$1 billion | AU$855,000 |
| Phase 2 review | Transaction valued above AU$1 billion | AU$1,595,000 |
| Public-benefit assessment | Application arguing that public benefits justify approval | AU$401,000 |
The Phase 2 charge is additional to the Phase 1 fee. Therefore, a transaction worth more than AU$1 billion that enters Phase 2 can incur AU$1,651,800 in ACCC review fees. A subsequent public-benefit application may add another AU$401,000, potentially pushing the regulatory charges above AU$2 million before legal advisers, economists, document vendors, and internal management time are counted.
The fee is not refundable merely because the ACCC takes longer than expected or ultimately refuses clearance. It reflects the review work rather than a guarantee that the transaction will be approved.
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Small Business Fee Relief
The regime includes a fee exemption for qualifying small businesses. An entity with aggregated turnover below AU$10 million may be eligible when it is the only notifying party or when all notifying parties satisfy the small-business definition.
This relief is important because a fixed five-figure fee could otherwise discourage a small company from completing an acquisition that creates little competition risk. Most purchases made by genuinely small businesses will fall below the notification thresholds anyway, although a small target acquired by a much larger group may still be captured.
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Which Acquisitions Must Be Notified?
The rules contain several monetary tests. A transaction generally must also involve a target carrying on business in Australia and must not qualify for an exemption.
The Large Merged Firm Threshold
Notification is generally required when the parties have combined Australian revenue of at least AU$200 million and either:
- the target has at least AU$50 million in Australian revenue; or
- the global transaction value is at least AU$250 million.
The Very Large Acquirer Threshold
A separate test applies when the acquiring group has Australian revenue of at least AU$500 million and the target has Australian revenue of at least AU$10 million. This rule is designed to catch relatively small purchases made by particularly large companies.
Serial Acquisition Thresholds
The ACCC may also examine acquisitions completed during the preceding three years when they involve the same or substitutable products or services. Depending on the acquirer’s size, the cumulative Australian revenue associated with those acquisitions can trigger notification.
This approach is particularly relevant to private equity rollups, digital platforms, healthcare consolidators, supermarket groups, logistics businesses, and other buyers that expand through repeated acquisitions. The days of examining each small bolt-on transaction in complete isolation are rapidly disappearing.
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How Long Can an ACCC Merger Review Take?
A notification waiver is intended for acquisitions that clearly present minimal competition concerns. The process is designed to be shorter and cheaper than submitting a complete notification, although a rejected waiver may still need to be followed by a full filing.
A Phase 1 review normally lasts up to 30 business days after the notification becomes effective. The ACCC generally cannot approve the transaction during the first 15 business days. When competition concerns require deeper examination, the regulator can move the matter into Phase 2, which may last up to an additional 90 business days.
Those statutory periods do not tell the entire story. The effective starting date may depend on whether the notification is complete. Deadlines can also change following material new facts, agreed extensions, information requests, or additional time sought by the notifying parties.
Consequently, a deal team should not sign an agreement on Friday, submit a form on Monday, and schedule the closing celebration for Tuesday. Regulators are not famous for enjoying surprise parties.
Why the Government Supports the Fee Model
Better Resourcing for the ACCC
A mandatory system produces more filings, more data, and more administrative work. Cost recovery supplies funding that is directly connected to review activity, allowing the ACCC to maintain specialized teams and investigate difficult transactions without relying entirely on annual general appropriations.
More Accountability
The ACCC is expected to monitor the cost of operating the system, report review volumes, and consult periodically on fees. A transparent charging structure can make it easier to compare collected revenue with the resources actually used.
Risk-Based Pricing
The tiered model places the largest charges on transactions that proceed to an in-depth investigation. Most straightforward deals are expected to finish in Phase 1 or obtain a waiver. Supporters therefore argue that the system reserves its heaviest financial burden for mergers that demand the greatest regulatory effort.
Why Businesses Are Concerned
Companies do not object only to writing a check. Their larger concern is the total burden created by the fee, mandatory forms, information requests, review uncertainty, and delayed completion.
The Real Cost Is Larger Than the Filing Fee
An ACCC charge may be only one part of the regulatory budget. Businesses may need Australian competition counsel, international antitrust coordination, economic analysis, market-share studies, customer data, board materials, document collection, and responses to detailed questions.
Management must also spend time explaining the industry, identifying competitors, validating revenue calculations, and reviewing submissions. That internal effort has an opportunity cost, even when it does not appear on an outside adviser’s invoice.
Large Fees May Affect Marginal Deals
A million-dollar review charge is usually manageable in a multibillion-dollar acquisition. It may be more significant when the target is smaller, the transaction has a narrow profit margin, or the buyer faces regulatory filings in several countries.
A deal that appears financially attractive before regulatory expenses may look less charming once the spreadsheet includes filing charges, economic consultants, delayed synergies, financing costs, and the possibility of divestitures.
Uncertainty Can Influence Negotiations
Buyers and sellers must decide who bears the regulatory risk. Acquisition agreements may address filing fees, cooperation obligations, remedies, information sharing, long-stop dates, termination rights, and reverse break fees.
A seller may demand strong commitments to pursue clearance. A buyer may resist promising to divest valuable operations simply to save the transaction. The ACCC fee does not create these disagreements, but it gives everyone a convenient new number to argue about.
How Australia Compares With the United States
Australia is not the first jurisdiction to charge companies for merger notification. In the United States, qualifying transactions reported under the Hart-Scott-Rodino Act are also subject to filing fees that vary with transaction size.
Australia’s structure is distinctive because a transaction moving into an intensive second-stage review must pay a substantial additional Phase 2 fee. In the United States, an extended investigation can generate enormous compliance costs, especially when agencies issue a second request, but there is not an equivalent ACCC-style second-stage filing charge layered onto the original HSR fee.
For multinational transactions, companies may therefore face separate notifications in Australia, the United States, the European Union, the United Kingdom, and other jurisdictions. Each authority has different thresholds, forms, timetables, and theories of competitive harm. Coordinating them is less like completing one puzzle and more like completing six puzzles while several people keep moving the table.
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What Early Results Suggest
The first months of the mandatory regime indicate that the ACCC is processing many uncomplicated transactions without sending them into an extended investigation. Between January 1 and March 31, 2026, the regulator received 50 merger notifications and 108 waiver applications, in addition to notifications lodged during the voluntary transition period.
During that period, 39 notifications were approved in Phase 1 and two advanced to Phase 2. The average Phase 1 approval took approximately 18 business days, while waiver decisions averaged about 11 business days.
Those figures are encouraging for companies pursuing low-risk transactions, although they represent only the opening months of a new system. Performance may change as filing volume grows, difficult cases accumulate, guidance evolves, and parties test the boundaries of the notification thresholds.
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Practical Experience: Lessons for Deal Teams
The following experience-based observations are composite lessons drawn from common M&A workflows. They do not describe a particular confidential transaction, but they illustrate how cost recovery fees can influence real-world deal planning.
1. Regulatory Budgeting Must Begin Before Signing
In the past, a buyer might initially treat Australian competition clearance as a question to resolve after commercial terms were nearly complete. That approach is now risky. The parties should assess notification thresholds, transaction value, Australian revenue, control, prior acquisitions, and potential overlaps while the deal is still being structured.
Consider a hypothetical global manufacturer acquiring an Australian distributor for AU$300 million. The businesses have limited horizontal overlap, but the buyer supplies products that the target distributes. The initial question is not merely whether the deal is anticompetitive. Counsel must also determine whether the thresholds are met, whether a full notification is necessary, how much the filing will cost, and whether the review can be completed before financing commitments expire.
Early analysis allows the buyer to place the AU$56,800 Phase 1 fee in the transaction budget and reserve additional funds in case the ACCC begins Phase 2. Discovering a possible seven-figure regulatory charge after board approval is an excellent way to make a board meeting memorable for all the wrong reasons.
2. A Waiver Is Cheaper, but Not Automatically Better
The AU$8,300 waiver route appears attractive when competitive overlap is minimal. However, a waiver application must still contain enough information for the ACCC to make a timely decision. If the waiver is not granted, the buyer may have to submit a full notification, pay the Phase 1 fee, and absorb additional delay.
Deal teams therefore need to compare the probability of receiving a waiver with the cost of losing time. A transaction involving two companies in unrelated industries may be an obvious waiver candidate. A deal involving adjacent products, important customer relationships, or a buyer with a history of acquisitions may justify proceeding directly to a complete notification.
The cheapest filing route is not always the cheapest transaction strategy.
3. The Data Room Must Support the Competition Story
A strong ACCC submission cannot be assembled from optimistic adjectives alone. The buyer may need reliable information about market shares, competitors, customers, suppliers, pricing, entry conditions, internal strategy, and previous acquisitions.
Before filing, legal and commercial teams should confirm that revenue calculations use the correct entities and reporting periods. They should also review board papers and strategic documents for statements that conflict with the proposed competition analysis.
A presentation describing the target as “our only serious competitive threat” is unlikely to become more adorable when an antitrust regulator reads it.
4. Acquisition Agreements Need Regulatory Flexibility
The contract should contain a realistic long-stop date and clearly assign responsibility for the ACCC process. It may specify who prepares the filing, who pays the fee, what information each party must supply, and whether the buyer must offer remedies.
Where Phase 2 is plausible, the parties should account for the additional review period rather than assuming Phase 1 clearance. Financing documents, employee communications, integration planning, and other regulatory approvals must align with that schedule.
The parties should also preserve operational independence before closing. Mandatory notification does not grant permission to begin integrating the businesses early, exchange competitively sensitive information without safeguards, or behave as though approval is inevitable.
5. Boards Need a Range, Not a Single Number
Management should present directors with several regulatory scenarios. A low-risk case may involve a waiver and a relatively short wait. A central case may involve a Phase 1 notification. A downside case may include Phase 2, economic experts, remedies, delayed synergies, and a public-benefit application.
This range-based approach prevents the initial filing fee from creating false comfort. The difference between an AU$8,300 waiver and a complex review costing millions is substantial. A board considering the acquisition needs to understand both ends of that spectrum before authorizing the deal.
Conclusion
Australia’s cost recovery fees are not a minor administrative adjustment. They are part of a fundamental shift from voluntary merger engagement to mandatory preclosing approval for qualifying acquisitions.
The model gives the ACCC additional resources and places the cost of intensive reviews on the businesses proposing the transactions. It may also improve transparency and help the regulator identify serial acquisitions that previously received limited scrutiny.
For dealmakers, however, the new system creates direct charges, preparation costs, timing risk, and more complicated negotiations. The smartest response is not to panic or avoid Australia. It is to evaluate competition issues early, maintain reliable transaction data, select the appropriate filing route, and build realistic regulatory scenarios into the agreement and financial model.
In modern M&A, the purchase price may get the headline, but regulatory planning often determines whether anyone reaches the closing table.
Note: This article provides general information and does not constitute legal advice. Merger thresholds, fees, exemptions, and procedural guidance may be amended or indexed. Businesses should confirm the latest ACCC and Australian Treasury requirements before acting.
