Australian Watchdog Plans Overhaul Of M&A Laws

Australia’s competition regulator has called for a sweeping overhaul of merger laws, stating they are anti-competitive and hurt consumers, reported Bloomberg.

The laws strongly favor companies seeking mergers or takeovers to be waved through, making it difficult for the regulator to challenge anticompetitive deals through the courts, the Australian Broadcasting Corp. quoted Australian Competition and Consumer Commission Chairman Rod Sims as saying at an event.

The nation’s merger and acquisition laws are “out of step” internationally and benefit large companies, while being detrimental to consumers, small businesses and the economy, Sims was cited as saying.

The regulator’s lack of success in merger cases had resulted in some “problematic acquisitions,” such as Vodafone Group’s merger with TPG Telecom, which removed the entry of a fourth mobile phone operator, the report stated. Another example was AGL Energy Ltd.’s acquisition of Macquarie Generation assets, which led to higher power prices, Sims said, according to the report.

Many markets in Australia are dominated by a small number of providers including banking, supermarkets, mobile telecommunications, internet services, and domestic air travel among others, Sims said.

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