Antitrust Update: Despite Administration's Rhetoric, No Major Enforcement Changes are Imminent
In recent weeks, the Biden administration issued two well-publicized messages about antitrust enforcement. These messages received significant media attention, with major news outlets reporting on the administration's commitment to "crack down on big tech" and "tackle corporate abuses." We are issuing this client alert to caution against overreaction.
The first message came from the Federal Trade Commission (FTC), one of the two federal agencies tasked with enforcing the antitrust laws. The other is the Department of Justice (DOJ), Antitrust Division. On July 1, the FTC voted to rescind a bipartisan 2015 policy statement regarding enforcement of FTC Act Section 5, which prohibits "unfair methods of competition." The 2015 policy statement contemplated case-by-case enforcement with the goal of promoting consumer welfare, thus aligning Section 5 enforcement with the DOJ and FTC's approach to other antitrust laws. The FTC's July 1 vote rescinded the 2015 policy statement but did not replace it with anything else.
The second message came from President Biden himself. Late last week, the president signed an Executive Order on Promoting Competition in the American Economy. The Executive Order contains 72 directives to over a dozen federal agencies. These directives are aimed at perceived anticompetitive practices in nearly every major industry segment, including agriculture, tech, healthcare, telecom, and transportation. The Executive Order calls for legislative action. It also requires executive branch agencies – and "encourage[s]" independent agencies like the FTC – to explore regulations aimed at promoting competition.
The FTC's July 1 vote and President Biden's Executive Order have garnered widespread media coverage – and for good reason. These statements by the federal government signal a more aggressive enforcement posture. Perhaps more importantly, they foretell future changes to antitrust laws through regulatory or legislative action. But as of today, nothing has changed. The FTC has merely rescinded a policy statement related to a statute (Section 5) it rarely invokes as a standalone basis for enforcement. And President Biden's Executive Order is merely an affirmation of longstanding antitrust policies and a call for future action; it does not change any current law.
The administration's commitment to antitrust enforcement will not be defined by policy statements or Executive Orders. It will, instead, be measured by enforcement actions and future lawmaking. Whether the administration will bring about any material change to U.S. antitrust laws thus remains an open question.