ACCC reviews first merger authorisation application

1 May 2019

The ACCC has started to assess an application lodged by AP Eagers Limited for authorisation to acquire Automotive Holdings Group Limited.

“AP Eagers’ application is the first merger authorisation considered by the ACCC since reforms in 2017 restored the ACCC’s ability to consider applications for merger authorisation. Under the new process, the application comes to the ACCC first rather than the Australian Competition Tribunal,” ACCC Chair Rod Sims said.

Under the new merger authorisation process, the ACCC may grant authorisation for a proposed merger if it is satisfied the merger is not likely to substantially lessen competition, or where the public benefits outweigh the detriments to the public (including where the proposed merger does lessen competition).

AP Eagers and AHG are the two largest automotive retailers in Australia. AP Eagers and AHG both supply new and used cars, trucks and buses, as well as associated products and services such as car repair and servicing, authorised car parts, insurance and finance.

They operate car dealerships around Australia, including a number of locations where they both compete, such as Brisbane, Melbourne, Sydney and the Newcastle/Hunter Valley region of New South Wales.

“The ACCC’s assessment will focus on the likely effects of the proposed acquisition on competition, and under the authorisation test the ACCC can also consider whether any public benefits likely to arise from the proposed acquisition would outweigh the public detriments,” Mr Sims said.

The authorisation process is public and transparent. AP Eagers’ application is available on the ACCC’s public register and submissions received during the consultation process will also be publicly available subject to confidentiality restrictions.

Background

Merger authorisation provides an alternative to the informal merger review process, which is the most common avenue merger parties use to seek the ACCC’s views on a proposed acquisition.

The authorisation process must follow formal steps set out in the Competition and Consumer Act, including that the ACCC must make a determination on the application within 90 days, unless the applicant agrees to extend the timeline. 

The ACCC has commenced public consultation, and is now seeking submissions from interested parties.

Further information, including a copy of the application for merger authorisation and the ACCC’s letter seeking public submissions is available at AP Eagers Limited proposed acquisition of Automotive Holdings Group Limited.

Release number: 
60/19
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