Biden administration proposes tougher rules for mergers in antitrust push

Federal antitrust enforcers released a long-anticipated draft of new merger guidelines Wednesday that would significantly change how large companies’ acquisitions are reviewed. 

The joint proposal from the Federal Trade Commission (FTC) and Department of Justice (DOJ) lays out 13 guidelines for how mergers would be reviewed. The agencies asked for public comment on the draft that will be open for 60 days. 

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“Unchecked consolidation threatens the free and fair markets upon which our economy is based,” Attorney General Merrick Garland said in a statement.

“These updated Merger Guidelines respond to modern market realities and will enable the Justice Department to transparently and effectively protect the American people from the damage that anticompetitive mergers cause.”

FTC Chair Lina Khan, a proponent of antitrust reform and vocal critic of the market power of tech giants, said the draft guidelines update enforcement to “reflect the realities of how firms do business in the modern economy.” 

“Informed by thousands of public comments—spanning healthcare workers, farmers, patient advocates, musicians, and entrepreneurs—these guidelines contain critical updates while ensuring fidelity to the mandate Congress has given us and the legal precedent on the books,” Khan said in a statement. 

Part of the guidelines includes a focus on “platform” companies, urging an update that would allow agencies to “examine competition between platforms, on a platform, or to displace a platform.”

Such an update focused on platforms could be critical in how the agencies take on massive tech companies. The FTC has faced recent hurdles in cases to block tech company’s acquisitions, including Microsoft’s deal to merge with Activision Blizzard and Meta’s acquisition of the virtual reality company Within. 

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Another proposed update would examine impacts on workers, a change from the current standards that focus on how mergers impact consumers. The agencies propose that when a merger involves “competing buyers” they examine “whether it may substantially lessen competition for workers or other sellers.”

The draft also proposes that when a merger is part of a series of multiple acquisitions, the agencies may examine the whole series.

The new guidelines are part of a joint push launched by Justice Department and FTC last year to limit mergers that could harm competition.

The Biden administration and Democratic lawmakers have sought to crack down on major corporate mergers and step up antitrust enforcement. They argue that regulators must do more to prevent mergers that could give a specific business too much power within an industry.

Most Republican lawmakers and business groups have panned the push to bolster antitrust rules, arguing that Democrats and progressive critics of major companies are overstating the harms and underrating the benefits of mergers.