What happened: IAG and RACWA are challenging the ACCC's block of their $1.35 billion RAC Insurance deal in an early test of Australia's new merger regime before the Tribunal.
Who's involved: Insurance Australia Group (acquirer), RACWA Holdings / Royal Automobile Club of WA (seller), the ACCC (regulator).
What's at stake: A $1.35 billion acquisition that would give IAG control of RAC Insurance's motor and home portfolios in Western Australia.
Why it matters: How the Tribunal handles this review will shape the way blocked insurance deals are challenged under Australia's mandatory merger notification regime.
Where it stands: Review applications filed; 12-day hearing set for late March to mid-April 2027; public benefit application expected within days.
Twelve days. That is how long the Australian Competition Tribunal has set aside to decide whether a $1.35 billion insurance deal - blocked by the regulator last month - should go ahead after all.
IAG's proposed acquisition of RAC Insurance - the underwriting arm of the Royal Automobile Club of Western Australia - hit a wall on September 23 when the ACCC ruled the deal must not proceed. The regulator concluded that the acquisition, if completed, would likely substantially lessen competition in the Western Australian insurance market.
Neither side of the deal accepted that verdict quietly.
IAG filed its challenge on October 1. Four days later, RACWA Holdings - the parent company of the seller - filed its own. Both the buyer and the seller are separately contesting the same ruling.
The Tribunal, in directions issued October 9, allowed RACWA's application and ordered both reviews to be managed and heard together. The reasoning was plain: as the counterparty to the acquisition, RACWA's commercial interests are "directly affected" by the ruling. The Tribunal noted that RACWA could have achieved a similar result simply by intervening in IAG's case rather than filing separately - and that doing so would have avoided triggering a second filing fee.
That fee is not small. Under the new regime, it is calculated at 0.12% of the deal's market value or consideration, capped at $2,950,000. The Tribunal ordered that only one fee be payable across both applications, given the relationship between the parties.
IAG is not relying on the Tribunal challenge alone. At an October 8 hearing, IAG told the Tribunal it plans to lodge a separate application arguing that the deal would deliver a net public benefit - even if it does reduce competition. RACWA indicated it may do the same. Both have until October 14 to file.
This is the two-track approach the new merger regime makes possible. If the ACCC accepts the public benefit argument, the applicants told the Tribunal they would drop the review proceedings entirely - because they would then be permitted to put the acquisition into effect. If the ACCC rejects it, they can challenge that decision too, and the Tribunal has already set up the timetable so all related challenges would be heard together.
There is a catch. Once a public benefit application is filed, the Tribunal review must pause until the ACCC decides. The applicants estimate that decision will come by early February 2027. From that point, the Tribunal's clock restarts.
The Tribunal took the unusual step of publishing reasons for what would normally be routine timetabling directions. The explanation: these applications have been brought under the mandatory merger notification regime introduced by the Treasury Laws Amendment (Mergers and Acquisitions Reform) Act 2024, which replaced Australia's voluntary system on January 1, 2026. The Tribunal wanted to set out its approach for handling multiple related applications under the new framework.
The Tribunal also pushed back on the applicants' proposed schedule, calling it "not realistic." It directed that preparation would need at least 35 business days after proceedings resume, and extended the statutory review period by 60 days. The hearing is listed across 12 sitting days from late March to mid-April 2027.
The deal's structure adds another layer. Of the $1.35 billion, $400 million covers the acquisition of RAC Insurance's shares, while the remaining $950 million is an upfront payment for a 20-year exclusive distribution and brand licensing agreement. Even if the Tribunal ultimately clears the acquisition, the competition concerns the ACCC identified - that the deal would substantially lessen competition across an entire state's motor and home insurance market - will frame every argument in that hearing.
How the Tribunal handles the intersection of a competition challenge and a public benefit challenge on the same deal will matter well beyond this transaction. It is the playbook every insurer weighing a contested acquisition will be watching.
The ACCC's ruling has been made but has not been the subject of a Tribunal hearing on the merits. IAG's public benefit application has not yet been filed. No court or tribunal has ruled on the substance of the review applications.
