ACCC chair Gina Cass-Gottlieb backs the federal Treasurer’s push to reform mergers laws

ACCC chair Gina Cass-Gottlieb says there is a “strong case” for reforming processes around mergers and acquisitions in order to protect the public’s interest.

ACCC chair Gina Cass-Gottlieb. Picture: Aaron Francis

The boss of the Australian Competition and Consumer Commission has backed Treasurer Jim Chalmers’ push to reform Australia’s mergers and acquisitions framework, saying too many deals were not being put forward for approval.

ACCC chair Gina Cass-Gottlieb told The Australian there was a “strong case” for reforming the current processes and tests around mergers and acquisitions to protect “the public interest”.

Speaking on the sidelines of the Australian Securities and Investments Commission’s annual forum, Ms Cass-Gottlieb said the ACCC’s view that the economy was growing increasingly concentrated was “very clear”.

Ms Cass-Gottlieb said she welcomed the Treasurer’s desire to ensure regulation delivered “the most productivity and innovation at a time when there’s real concern across the business community” about the issues.

Ms Cass-Gottlieb said the current regime was leading to too many acquisitions never making their way to the ACCC for approval, with several deals being revealed only when a later bigger sale was floated with the regulator.

She pointed to Woolworth’s PETstock deal, to buy 55 per cent of the retailer, which itself was coming only after the company had rolled up almost 50 other shops in deals that had not been disclosed to the ACCC.

“When you don’t have mandatory notification, this can occur,” Ms Cass-Gottlieb said.

“We consider in quite a range of local areas those acquisitions did, were likely to substantially less competition in the supply of products,” she said.

Ms Cass-Gottlieb said, who took on the top job at the regulator in March last year after veteran Rod Sims wrapped up his term, said reforms to the mergers and acquisitions rules were even more pressing given the current “cost constrained environment”, which made it important what prices businesses charged.

“The bottom line is when there is not an obligation to man­datorily notify, there is then the capacity that particularly in serial acquisitions, and there are a number of retail industries where this is a concern to us, that much is happening and can be happening with no visibility and assessment by the ACCC,” Ms Cass-Gottlieb said.

“What mandatory notification allows us to do is to discern the ones that have the capacity to lead to increased concentration and a lessening of competition in key sectors that are important to our economy.”

Writing previously in The Australian, Treasurer Chalmers said that the country was ­facing a less competitive business environment as a spate of ­acquisitions saw companies crunch productivity.

“We want to enable beneficial mergers while preventing or mitigating those that would substantially harm competition,” he said.

“Ultimately, mergers should drive improvements in productivity, put downward pressure on prices and deliver more choice for Australians dealing with cost-of-living pressures.”