US regulators target illegal and anti-competitive mergers – Orange County Register

U.S. competition regulators have worked to tighten enforcement against illegal mergers, in line with President Joe Biden’s mandate for tighter scrutiny of conglomerates big business.

The Department of Justice and the Federal Trade Commission announced Tuesday that they are seeking public comment on how current merger guidelines could be updated to better detect and prevent transactions. illegal and anti-competitive in an increasingly consolidated corporate market. Agencies are stressing the importance of strong competition for the economy, workers, consumers and small businesses.

“Our country depends on competition to drive progress, innovation and prosperity,” said Assistant Attorney General Jonathan Kanter, head of the Justice Department’s antitrust division. “We need to understand why so many industries have so few competitors and must think carefully about how to ensure our merger enforcement tools are fit for purpose in the modern economy.”

In their request for a public view on mergers, regulators are moving towards a broader definition of anticompetitive behavior. They said they were concerned about aspects of competition that current merger guidelines might overlook, such as the impact on the labor market and other issues not tied to price, such as innovation and quality. Regulators are also looking for specific examples of mergers affecting competition.

“Today the DOJ and the FTC should begin to orient the US government once more in the direction of freedom and fair democracy. Government antitrust guidelines provide an important statement about how regulators view the nature of power,” Barry Lynn, executive director of the Open Market Institute, said in a statement. . The group advocates for stricter antitrust regulation.

The trend of concentration began with the merger boom of the 1980s in US companies, increasing profits for the dominant firms. Decisions by both Democratic and Republican administrations over the past 15 years have allowed most major mergers to go smoothly.

Regulators noted Tuesday that an increase in ongoing mergers is reflected in companies’ applications for approval, a number that has more than doubled between 2020 and 2021.

The latest high-profile proposed merger landed on Tuesday, with news that Microsoft is paying nearly $70 billion for Activision Blizzard, maker of Candy Crush and Call of Duty, as it searches The edge in the mobile game and virtual reality businesses is fiercely competitive. Technology.

The $68.7 billion all-cash deal must pass close scrutiny from US and European regulators in the coming months. If passed, it would make Microsoft, the maker of the Xbox gaming system, one of the largest video game companies in the world.

Biden issued a sweeping executive order in July highlighting preeminent market power in industries including Big Tech, healthcare, aviation and agriculture. Biden said the actions he is calling for will lower prices for families, raise wages for workers and spur innovation and faster economic growth. The order includes 72 actions and recommendations for federal agencies, which must translate his policies into rules.

According to the White House, when fewer, larger players controlled a wide variety of markets, prices outpacing the costs of companies tripled, forcing families to pay higher prices for basic needs. essential needs such as prescription drugs, hearing aids, and internet service.

Tuesday’s announcement was made by Kanter and Lina Khan, the head of the FTC. Kanter, an antitrust lawyer who has opposed tech giants in private practice, took over the Justice Department’s antitrust division in November. Khan, who became head of it FTC in June, was an outspoken critic of Big Tech before joining the government.

Kanter is likely to continue to prosecute the landmark antitrust lawsuit against Google filed by the Trump Justice Department in October 2020, accusing the company of abusing its dominant position in search and Online Advertising.

The FTC, meanwhile, is pursuing an antitrust lawsuit against Facebook, now known as Meta, asserting that the tech giant has a monopoly on the social networking market. The agency is seeking remedies that could include forcibly severing the company’s popular Instagram and WhatsApp messaging services or an overall restructuring.

In a significant antitrust action, the Justice Department in November sued to block the proposed $2.2 billion acquisition of Simon & Schuster by German media giant Bertelsmann’s Penguin Random House, which was America’s largest book publisher. Regulators say industry consolidation will hurt authors and ultimately readers, giving Penguin Random House “too much influence” over books published in the US and the amount of money Authors are paid.

In another action last fall, the Justice Department challenged American Airlines’ partnership with JetBlue, asserting that the airline could deliver higher airfares.