FTC, DOJ to Overhaul Merger Guidelines

The Federal Trade Commission (FTC) and Department of Justice (DOJ) are working together to transform their merger guidelines, with the new rules likely to most significantly affect digital mergers, mergers with potential or nascent competitors, and vertical mergers between suppliers and their customers.

FTC and DOJ are expected to hand down their new guidelines by the end of the year, according to a Reuters report Monday (March 7). President Joe Biden’s Executive Order on Promoting Competition urged the FTC and DOJ to revise their joint merger guidelines as part of a wide-ranging effort to increase antitrust protections.

The merger guidelines “describe the principal analytical techniques and the main types of evidence” the agencies rely on to determine whether a merger may “substantially lessen competition,” the report said.

The Horizontal Merger Guidelines were last revised in August 2010, while the Vertical Merger Guidelines were updated in June 2020 from their 1984 predecessor but withdrawn by FTC leadership in September 2021 because they were based on “unsound economic theories that are unsupported by the law or market realities,” according to the report.

FTC Chair Lina Khan said in January that the FTC and DOJ need to “ensure that our merger guidelines reflect modern realities and equip us to forcefully enforce the law against unlawful deals,” while Assistant Attorney General Jonathan Kanter said the agencies “need to understand why so many industries have too few competitors, and to think carefully about how to ensure our merger enforcement tools are fit for the purpose in the modern economy.”

The FTC and DOJ will close their public comment period on March 21. They want comments from attorneys, economists and academics, as well as consumers, entrepreneurs, startups, investors, farmers, workers and independent businesses.

Related: FTC: Lifespan, Care New England Merger Would Have Brought ‘Higher Prices and Lower Quality Care’

Last week, FTC Bureau of Competition Director Holly Vedova said in a statement she was “pleased” about the termination of the proposed merger between Lifespan and Care New England “that should never have been attempted in the first place.”