The ACCC Merger Guidelines: A Review

22 Pages Posted: 26 Jun 2009 Last revised: 14 Jul 2009

Henry Ergas

University of Wollongong - SMART Infrastructure Facility; Deloitte Access Economics

Eric Kodjo Ralph

EKonomics LLC

Alex R. W. Robson

Griffith University - Griffith Business School, Department of Accounting, Finance and Economics

Date Written: June 23, 2009

Abstract

The Merger Guidelines released in March 2008 by the Australian Competition and Consumer Commission (ACCC) provide a guide to the analytical approach the ACCC intends to adopt to assessing mergers for the purposes of s.50 of the Trade Practices Act. The new Guidelines do a relatively good job in listing the factors that the contemporary economic literature identifies as potentially characterising mergers that reduce competition and harm consumer welfare. However, unlike the earlier Guidelines, they rarely explain the mechanism connecting the factors to the harm, and the conditions that need to be met for that harm to occur.

This paper provides a “user’s guide” to the Guidelines that explains the reasoning that underpins the Guidelines’ assertions, and draws attention to the assumptions on which those assertions rest. We also provide an economic assessment of the Guidelines and recommend a simpler criterion by which the ACCC should judge mergers.

Keywords: Mergers, Merger guidelines, Competition

JEL Classification: G34, D4, L1, L4

Suggested Citation

Ergas, Henry and Ralph, Eric Kodjo and Robson, Alex R. W., The ACCC Merger Guidelines: A Review (June 23, 2009). Available at SSRN: https://ssrn.com/abstract=1424721 or http://dx.doi.org/10.2139/ssrn.1424721

Henry Ergas (Contact Author)

University of Wollongong - SMART Infrastructure Facility ( email )

Northfields Avenue
Wollongong, New South Wales 2522
Australia

Deloitte Access Economics ( email )

9 Sydney Avenue
Barton
Canberra, Kingston 2600
Australia

Eric Kodjo Ralph

EKonomics LLC ( email )

706 S Milton Ave
Baltimore, MD 21224-3754
United States
+1-504-708-2342 (Phone)
+1-815-301-5449 (Fax)

HOME PAGE: http://www.ekonomicsllc.com

Alex R. W. Robson

Griffith University - Griffith Business School, Department of Accounting, Finance and Economics ( email )

Brisbane, Queensland 4111
Australia

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