Merger Rules Get Tougher in Crackdown by Antitrust Enforcers

8. Mergers should not further a trend toward concentration.

9. When a merger is part of a series of multiple acquisitions, the agencies may examine the whole series.

10. When a merger involves a multi-sided platform, the agencies examine competition between platforms, on a platform, or to displace a platform.

11. When a merger involves competing buyers, the agencies examine whether it may substantially lessen competition for workers or other sellers.

12. When an acquisition involves partial ownership or minority interests, the agencies examine its impact on competition.

13. Mergers should not otherwise substantially lessen competition or tend to create a monopoly.

In an interview with CNBC, Khan said the updated guidelines will help ensure enforcers “fully addressing the realities of digital markets, the realities of how firms are pursuing M&A in the current environment.”

The White House heralded the guidelines update as an important revision to reflect changing economic conditions. Biden is set to meet with members of his Competition Council, which includes Khan and representatives from DOJ, later Wednesday.

Senator Elizabeth Warren, a Massachusetts Democrat and backer of Khan and Kanter, applauded the revamp, calling it “a much-needed update to counter the real harms posed by corporate monopolies.”

‘Chill Merger Activity’

The proposals are likely to draw criticism from House Republicans, many of whom have criticized Khan and Kanter for their more aggressive approach to antitrust enforcement.

The U.S. Chamber of Commerce, the nation’s largest business lobby which has been highly critical of Biden’s antitrust enforcers, condemned the new proposal saying it upends decades of bipartisan consensus that mergers aid the US economy.

“These guidelines are designed to chill merger activity, which will deny smaller companies access to the capital and expertise they need to grow and place U.S. businesses at a disadvantage with their global competitors,” Chamber vice president Neil Bradley said.

The agencies began the merger rule revamp in January 2022 and have spent the past 18 months honing new guidelines that would apply to all mergers and acquisitions. Last month, they also proposed an overhaul of the information that companies must provide during merger reviews for the first time in 45 years.

The agencies last changed the guidelines for mergers between direct competitors in 2010.

Separate guidelines for so-called vertical deals, which involve companies that operate in the same supply chain but don’t compete directly, were revised in 2020 under former President Donald Trump. Khan and her fellow Democratic FTC commissioners withdrew the agency’s approval of those changes in 2021.

The new proposal includes rules related to both horizontal and vertical deals as well as ones that involve online platforms.

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