Looming ACCC Merger Reform to impact the Australian Merger & Acquisition Market in 2026: Australian Economy with an M&A Lens

The Australian economy seems to be in a stable position heading into 2026, with GDP Growth around 1.3% (Y-o-Y March 2025), unemployment at around 4.2% (July 2025) and inflation levels around 2.1% (June 2025). All very conservative figures for an economy with strong GDP per capita and neighbouring countries who are generally observing ~4%+ GDP growth; in reality, Australia is an economy that is experiencing a general slowing in economic growth.

When reviewing the health of the Mergers & Acquisition (M&A) market in Australia, this too is mixed. M&A activity seemed to grind to a halt in 2023 and 2024, however since the Reserve Bank of Australia started cutting interest rates at the start of 2025, CDI Global ANZ has seen increased M&A activity and general improvement in business sentiment.

The Westpac-Melbourne Institute Consumer Sentiment Index for Australia in August 2025 reached its highest level (98.5) since early 2022. Similarly, NAB’s Business Confidence Index recently hit its highest point since August 2022. Lower borrowing costs following three RBA rates cuts in 2025 (to August), inflationary pressures now seemingly under control, and a generally more positive business outlook are all factors behind improving sentiment in Australia.

Positive tailwinds are evident for the Australian M&A landscape; however a new regulatory mandated anti-competition reform is upon the Australian business environment, which may introduce headwinds and stifle the returning growth of upper and middle market M&A activity in Australia.

ACCC Merger Reform

Anti-competitive control is not new to Australia, however a new reform was introduced and passed by Australian Parliament in November 2024 and coming into full mandatory effect from 1 January 2026. This reform, officially called the Treasury Laws Amendment (Mergers and Acquisition Reform) ACT 2024, introduces a mandatory M&A clearance requirement, which replaces the previous voluntary notification process.

Whilst this may not sound onerous, the financial threshold requirements are relatively small, the filing costs involved are large, and it adds another hurdle to jump to successfully complete a deal.

Increased Transaction Costs

From 2026 onwards the compulsory merger notification regime commences. This means costs will be involved to file for approval of the deal, whether it may be exempt from a notification process or not.

• If a transaction meets the relatively modest thresholds, and the parties wish to seek exemption from the review process, then they will be required to file for a notification waiver. This will add a $8,300 cost to the transaction to file this notification waiver.
• If the ACCC rejects the exemption, an initial assessment of the transaction will be required. If an application for exemption is not applicable, the transaction must commence with a Phase 1 Review. A Phase 1 review incurs a filing fee of $56,800 and is expected to take 30 business days to complete.
• In the event the transaction requires a more “in-depth assessment”, then a secondary filing fee applies. This ranges from $475,000 (if the transaction is <$50m), to $855,000 (if the transaction is between $50m and $1bn), to $1,595,000 (if the transaction is >$1b). This Phase 2 assessment is expected to take around 90 business days to complete.

The notification thresholds generally involve monetary aspects, for example, if the buyer plus seller had revenue of at least AUD$200m (which must include all the connected entities of the buyer), and the revenue of the seller was at least AUD$50m, then it would require an assessment by the ACCC. There are various other aspects related to the thresholds which may trigger an assessment – however it is likely to impact many transactions in Australia. As a result, to ensure the transaction is not Void, a successful waiver exemption application must be obtained, otherwise an assessment will be conducted by the ACCC.

Impact to the M&A Landscape

The intention is good, to catch more anti-competitive outcomes for the Australian consumer and marketplace, however for the M&A landscape this reform adds yet another challenge to support buyers and sellers towards a successful outcome. The reform will capture a multitude of transactions, regardless of how high or low the likelihood of an anti-competitive outcome from the transaction.

Businesses operating in industries such as grocery, fuel, telecommunications, infrastructure, healthcare, financial services have always observed high levels of scrutiny.  Given the concentration, size, consolidation, and bargaining power of key players within some of these industries, the level of scrutiny will now increase. This level of scrutiny will now flow through to all industries, based on threshold levels triggering ACCC Phase reviews. Further to this, it will also impact corporate firms and Private Equity who look to seek aggressive roll-up strategies, or market consolidation plays, with higher chance of notification requirements. This will be reviewed in greater detail if the nature of these roll-up’s occurred within the most recent 3-years.

As an obvious impact, higher transaction costs are inevitable. Previously these costs were non-existent, but now incur a minimum $8,300 cost. At a peak, filing costs could exceed $2m, if the transaction was to lead towards a Public Benefit Phase (i.e. Phase 3), which incurs a further $401,000 fee; this being over and above, the costs to Phases 1 & 2. These are just the filing fees; it is likely that there will be additional legal costs to manage, challenge and support the assessment process on behalf of the buyers. 

As a flow on effect of these now mandatory costs and likely legal bills, it may then lead to lower multiples paid for businesses, as buyers, particularly Private Equity, may look to hedge against the inevitable expenses to maintain and achieve a specified rate of return that could be associated with the transaction. This would be particularly true for transactions that are <$50m, as the fixed Phase 2 fee of $475,000 could have a material bearing on the ultimate ROI. It may even lead to certain firms exiting the small-mid M&A market altogether, as the need for this compliance on a small transaction is not worth the risk/reward.

Further to this it is expected that there will be inevitable delays and timeline extensions to successfully complete a deal. The Phase 1 ACCC review process is expected to take 30 business days, however if the transaction is pushed to Phase 2, then the entire review process could drag on for many months beyond initial submission.

All these aspects can lead to increased chances of deal leakage, deal delay, deal fatigue, and generally a higher chance of an unsuccessful completion.

Setting Expectations

Sellers, buyers, corporate advisors, lawyers, and all other parties involved who support the M&A process must remain vigilant and aware of the inevitabilities that will come with change. The ACCC merger reform is a significant change to Australia's merger control regime, and so setting expectations early will assist in mitigating some of the risks.

Corporate advisors working on the buy-side for clients will need to ensure their clients are aware of the greater regulatory interventions, and set expectations that deals will come at higher costs and longer timelines. Looking to file for assessment early in an M&A process will be important, to avoid delays to completion in the event the ACCC is bogged down by applications and expected timelines are extended.

Sellers on the other hand should consider carefully the buyer profile and what possible likelihood there is of an assessment being enforced. The price put on a business is always an attractive part of an offer to consider, and it often sways a seller to accept, however in 2026 never has the nature of the deals “T&Cs” been more important in considering whether one offer is more attractive than the other.

At CDI Global Australia, we understand that the upcoming ACCC merger reforms present new challenges and complexities for businesses seeking to grow or exit through M&A. Our expertise in mid-market domestic and cross-border M&A has us well positioned to guide companies through the complexities of M&A, streamline a process, and ensure a successful outcome for all parties involved. We welcome the challenges ahead and seek to maintain our highest level of service and transactional success to our mandated clients.

By: Toon van Beeck, CDI Global Managing Partner Australia & New Zealand and Chris O’Connor, CDI Global Member Australia