The Australian Competition Tribunal has formally made its determination granting merger authorisation for Tabcorp to acquire Tatts and has today published its reasons for decision.
In November 2016 Tabcorp sought informal merger clearance from the ACCC to acquire Tatts.
Shortly after the ACCC released its paper seeking views on potential competition issues in March 2017, Tabcorp withdrew its application for informal clearance and instead lodged an application with the Tribunal for authorisation of its proposed acquisition of Tatts.
“While the ACCC had raised some initial concerns, we had not made any final decision when Tabcorp decided to change horses mid-race and apply to the Tribunal,” ACCC Chairman Rod Sims said.
“As we stated at the time, it was well within its rights to do so.”
The ACCC’s role in the Tribunal process was then to assist the Tribunal by providing a report, calling evidence and cross-examining witnesses, as well as making submissions on relevant issues.
At the commencement of the Tribunal process, the ACCC had not formed a view on whether or not authorisation of the merger should be granted.
“It was only in our closing submissions, after assessing all the evidence, that the ACCC put the view that the public benefits claimed were not likely to clearly outweigh the public detriments to justify the grant of an authorisation,” Mr Sims said.
The Tribunal may only grant merger authorisation when it is satisfied that the proposed merger would be likely to result in a net public benefit.
“The Tribunal’s net public benefit test requires a weighing of the likely detriments and benefits and is a vastly different one to the substantial lessening of competition test which the ACCC applies in its informal merger clearances,” Mr Sims said.
The ACCC will now consider the reasons for decision published by the Tribunal.