AAI Provides Comprehensive Look at Merger Policy to Assist Federal Agencies in Updating Guidelines
AAI has submitted a response to a request for information from the Federal Trade Commission and Department of Justice (“Agencies”) to assist the Agencies in updating their merger guidelines.
AAI’s response to the request for information addresses both overarching aspects of merger policy and specific aspects and omissions from the 2010 Horizontal Merger Guidelines currently in effect. (The 2020 Vertical Merger Guidelines are no longer endorsed by both agencies). AAI’s response begins by discussing key principles for an effective review and drafting process and then provides detailed legal, economic, and policy analysis of nine major issues that are particularly important for the Agencies to consider in updating and strengthening their merger guidelines, which implicate a critical area of antitrust enforcement.
On January 18, 2022, the FTC and DOJ announced that they were launching an inquiry into antitrust enforcement against illegal mergers. As part of the inquiry, which was encouraged by President Biden’s Executive Order on Promoting Competition in the American Economy, the Agencies issued a detailed request for information addressing potential updates to the Agencies’ merger guidelines.
AAI’s response to the request examines a series of substantive considerations the Agencies should consider and address, including the following:
- Accounting for mergers that are part of a trend toward concentration but that may not be individually concentrative in isolation
- Accounting for merging parties’ past antitrust violations—whether for collusion or monopolization—in predicting the effects of their mergers
- Clarifying the probative value of various forms of evidence, viewed both individually and collectively, including evidence of non-price effects, intent evidence, and evidence of post-merger effects in addressing consummated mergers
- Accounting for the buyer power and labor-market effects of mergers, countervailing power as a merger defense, and how to evaluate divergent pro- and anticompetitive effects found on the buy-side and sell-side of a market or across different markets
- Accounting for special complexities accompanying mergers involving digital business ecosystems
- Accounting for mergers involving two-sided simultaneous transaction platforms as defined by the Supreme Court in Ohio v. American Express
- Updating competitive effects theories to account for nascent competitor acquisitions and mergers facilitating information exchange
- Accounting for empirical and other trends in merging firms’ failure to realize claimed efficiencies
- Considering how remedies factor into appropriate merger guidance.