RBB comments on proposed changes to competition test for mergers in Australia

Treasury in Australia is consulting on proposals to replace the existing framework for merger review with a new mandatory and suspensory administrative system and on a change to the substantial lessening of competition or SLC test currently used to assess the competitive effects of mergers. 

RBB Economics has provided a submission to Treasury arguing that the proposed changes to the SLC test are unnecessary and risk shifting the Australian Competition and Consumer Commission’s focus away from a proper competitive assessment that enquires into whether the competitive process will be adversely affected because of the merger towards a heavier reliance on structural features and pre-existing market power.