The Australian Competition and Consumer Commission today commenced market consultation on proposed undertakings offered by National Australia Bank Limited (NAB) and AXA Asia Pacific Holdings Limited (AXA).
The undertakings seek to address the ACCC's competition concerns that the proposed acquisition of AXA by NAB would be likely to result in a substantial lessening of competition.
On 19 April 2010, the ACCC announced its decision to oppose the proposed acquisition of AXA by NAB. The ACCC found that a merger of NAB and AXA would likely result in a substantial lessening of competition in the market for the supply of retail investment platforms for investors with complex investment needs.
The ACCC considered that AXA's North platform has the potential to provide a strong competitive constraint in this market, in the form of platform functionality and innovation, and is likely to be versatile in responding to future competing platform offerings. The ACCC found that NAB is a significant competitor in the provision of retail investment platforms for this investor group and that a merger of NAB and AXA would remove competitive tension.
The undertakings provide for the divestiture of the North platform administration business carried out by AXA using the Bluedoor software (owned by DST Global Solutions) to IOOF Limited (IOOF).
The ACCC now seeks views from market participants to assist its consideration of the undertakings and of IOOF as a proposed purchaser of the divestiture business, and to determine whether the proposed divestiture would be likely to alleviate the ACCC’s competition concerns.
The ACCC's concerns and the objectives of the undertakings in resolving them are explained in the undertaking documentation, along with the details of how they are intended to operate.
Following market consultation, the ACCC will decide whether to accept or reject the proposed undertakings, including IOOF as a proposed purchaser of the divestiture business.
The proposed undertakings are available on the ACCC website.
Parties wishing to make submissions should do so by 23 August 2010. The ACCC anticipates making its final decision on the proposed undertakings by 9 September 2010. The ACCC notes that the timing of its final decision on the proposed undertakings may vary depending on the nature and extent of any concerns raised during the market consultation process and the ability of NAB and AXA to respond to these concerns in a timely manner.
Consistent with its usual practice, the ACCC will not make any public comment in relation to the proposed undertakings during the market consultation process, or prior to its decision.