The Federal Trade Commission and the Department of Justice on July 19 released a draft update of the merger guidelines, which outline the agencies' review of mergers and acquisitions to determine compliance with antitrust laws.
The update aims to better reflect how the agencies determine a merger's effect on competition in the modern economy and evaluate proposed mergers under the law, according to the FTC.
"Open, competitive, resilient markets have been a bedrock of America's economic success and dynamism throughout our nation's history. Faithful and vigorous enforcement of the antitrust laws is key to maintaining that success," FTC Chair Lina Khan said in a July 19 news release. "With these draft merger guidelines, we are updating our enforcement manual to reflect the realities of how firms do business in the modern economy."
The draft guidelines update frameworks outlined in previous versions. The guidelines provide an overview of 13 principles that the agencies may use when determining whether a merger is unlawfully anticompetitive under the antitrust laws.
Here are the 13 guidelines:
1. Mergers should not significantly increase concentration in highly concentrated markets.
2. Mergers should not eliminate substantial competition between firms.
3. Mergers should not increase the risk of coordination.
4. Mergers should not eliminate a potential entrant in a concentrated market.
5. Mergers should not substantially lessen competition by creating a firm that controls products or services that its rivals may use to compete.
6. Vertical mergers should not create market structures that foreclose competition.
7. Mergers should not entrench or extend a dominant position.
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.
The deadline for the public to provide comments on the draft merger guidelines is Sept. 18.
To read the 51-page document, click here.