09/15/2021 | Press release | Distributed by Public on 09/15/2021 12:29
Acting Assistant Attorney General Richard A. Powers of the Justice Department's Antitrust Division issued the following statement today after the Federal Trade Commission (FTC) voted to withdraw from the 2020 Vertical Merger Guidelines, which had been issued jointly with, and remain in place at, the Department of Justice:
'The Department of Justice is conducting a careful review of the Horizontal Merger Guidelines and the Vertical Merger Guidelines to ensure they are appropriately skeptical of harmful mergers. Both documents are designed to provide increased transparency and guidance to the public on how the department makes law enforcement decisions. The department's review has already identified several aspects of the guidelines that deserve close scrutiny, and we will work closely with the FTC to update them as appropriate.
'The department continues to collaborate with the FTC on a robust public engagement process to seek comment on ways the Vertical Merger Guidelines could be improved. Public comment, which has not yet been sought on the substantial changes made to the published version of the Vertical Merger Guidelines, will be helpful in considering a range of questions, including the following areas that staff has identified warrant consideration:
'The Justice Department recognizes the substantial benefit of providing transparency on these and all of the other issues touched on by the Vertical Merger Guidelines, and will work closely with the FTC as this process continues.'
See United States v. AT&T, Inc., 916 F.3d 1029, 1045 (2019) ('Preliminarily, the court does not hold that quantitative evidence of price increase is required in order to prevail on a Section 7 challenge. Vertical mergers can create harms beyond higher prices for consumers, including decreased product quality and reduced innovation.')
See United States v. Baker Hughes,908 F.2d 981, 982-83 (D.C. Cir. 1990)(cited in AT&T, 916 F.3d at 1032).
See Carl Shapiro, Vertical Mergers and Input Foreclosure Lessons from the AT&T/Time Warner Case, 59 Rev. of Indus. Org. 303 (2021) (noting risks associated with requiring quantification of net harm as part of the government's prima facie case, and benefits of the sequencing in the Baker Hughes framework in the context of vertical mergers).
See Steven S. Salop, The 2020 Vertical Merger Guidelines: A Suggested Revision, Geo. L. Fac. Publications & Other Works (2021), available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3550120.