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ACCC Calls For Merger Law Review After Fresh Loss

Australian Competition and Consumer Commission chairman Rod Sims said the handling of mergers needs a “rethink”, a week after knocking back the TPG-Vodafone merger because of dubious claims over competition.

Mr Sims told the Australian Financial Review “we need a real rethink on how merger issues are dealt with in Australia,” after the competition watchdog lost yet another battle in the courts yesterday.

Mr Sims maintains there’s nothing wrong with the Commission’s legal strategy, telling the AFR the system is responsible for the fact its “record is lousy” on mergers.

“About 85 to 90 per cent of cases we take to court are successful in cartels, competition and consumer law,” Mr Sims said.

“When you are winning the cases all of the time in all other areas of the law but not in mergers, it is clear there is a problem with the merger regime in Australia.”

The loss in a case brought by freight operator Aurizon comes after TPG and Vodafone announced they would challenge the Commission’s decision to block a $15 billion merger between the two companies.

The Commission claims the merger would reduce competition in the mobile sector and it believed TPG would build a fourth mobile network, even though the company abandoned the idea earlier this year after a government ban on the Huawei technology it planned to use.

One TPG board member accused the ACCC of rejecting the merger to protect the NBN, which charges wholesale prices to telcos using the infrastructure.

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