‘David and three Goliaths’: Labor tackles corporate mergers with ACCC review policy pitch
Labor wants the ACCC to conduct post-merger reviews so it’s harder for big firms to get away with corporate moves which damage competition.
It will be harder for big firms to get away with pushing independents out of markets with large corporate mergers under a policy pitch put forward by the federal opposition today.
Shadow Assistant Treasurer Andrew Leigh wants to beef up scrutiny over corporate mergers by making the competition watchdog do a more thorough analysis of their effects.
Under Labor’s plan, post-merger reviews undertaken by the ACCC would be “independent and transparent” and be conducted twice in the decade following the merger.
Leigh said the reforms would allow the ACCC to test claims made at the time a merger was approved.
The analysis would consider economic outcomes like productivity, prices, employment and wages.
In a release announcing the policy, Leigh made the point that from 1989 to 2019, the number of mergers in Australia has increased from 259 to 1,909.
The total value of those mergers rose from $US34 billion ($47.59 billion) to $US146 billion ($204.36 billion).
ACCC chairman Rod Sims recently raised issue with merger law in Australia, complaining in an op-ed published by The Australian the bar for determining whether a merger is anti-competitive is too high.
“There is, for example, too much faith in the capacity of market forces to overcome concentrated market structures,” he said.
Labor’s policy doesn’t change the framework for pre-merger approvals, but Leigh said it will help the watchdog learn from past decisions.
“Big isn’t always beautiful,” Leigh tells SmartCompany.
“It used to be a case of David taking on Goliath — now it’s David taking on two or three Goliaths at the same time.
“For family enterprises struggling to compete with behemoths, it’s important to know what mergers are getting careful scrutiny.”
The post-merger reviews are the second ACCC-focused policy Labor has unveiled so far this month in addition to its super-complaint initiative.
NOW READ: The dark side of online travel booking: Fed up small businesses call for ACCC action
Comments