U.S. antitrust law enforcers defend actions, lawsuits
The FTC and DOJ, which enforce U.S. antitrust law, are focused on reining in big tech through antitrust lawsuits and revising merger guidelines for modern businesses.
The U.S. government's top antitrust enforcers say they are doubling down on efforts to rein in tech giants, redefine merger guidelines and heighten focus on how anti-competitive business behavior affects the labor market.
Federal Trade Commission (FTC) Chair Lina Khan and Jonathan Kanter, assistant attorney general for the antitrust division at the Department of Justice (DOJ), have faced criticism over their antitrust lawsuits against tech and retail giants. But during a Brookings Institution webinar Thursday, they went on the defensive about how U.S. antitrust law enforcement agencies are tackling concerns that big tech companies maintain control of online markets and cause harms to consumers, labor markets and small businesses.
Indeed, the FTC recently filed an antitrust lawsuit against Amazon alleging it is illegally maintaining its monopoly power and harming competition. Meanwhile, the DOJ is litigating a case against Google, alleging it is unlawfully maintaining monopolies in the search and advertising markets.
That lack of competition is harming the American people.
Lina KhanChair, Federal Trade Commission
President Joe Biden issued an executive order in 2021 urging the FTC and DOJ to focus on increasing competition in the U.S., which Khan said has indicated a "serious reassessment of antitrust and the need for reinvigorated competition policy." Waves of merger and acquisition activity and corporate consolidation in recent years have led to markets dominated by a handful of companies, she said.
"That lack of competition is harming the American people," Khan said during the webinar. "It's resulting in higher prices, it's resulted in lower wages, it's led innovation to decline, it's made it more difficult for entrepreneurs and startups to really get a foothold in the market. This, overall, means that our economy is worse off, but it also means our democracy is worse off."
U.S. antitrust law enforcement leaders outline successes
Antitrust experts have raised concerns that the FTC and DOJ will face challenges successfully litigating against companies such as Amazon and Google. However, both Khan and Kanter pointed to recent victories such as the FTC's case challenging Nvidia's acquisition of Arm and the DOJ's challenge of JetBlue's alliance with American Airlines as indicators that they've had "quite a bit of success," Kanter said.
Along with filing antitrust lawsuits against big tech companies, the FTC and DOJ are working to revise longstanding merger guidelines for businesses. Kanter said the draft guidelines address today's business world, which has changed significantly since the last time the guidelines were updated in 1982.
The agencies are already challenging proposed mergers and acquisitions that potentially raise competition concerns, which Kanter said has resulted in a decline in problematic mergers coming before the DOJ and FTC.
"That is a win-win," he said. "It means that we don't have to use unnecessary taxpayer resources to block transactions."
Indeed, Khan said business leaders have indicated that antitrust concerns are being considered at the forefront of any potential merger or acquisition rather than in the middle or at the end of a deal.
"There are deals that are not being proposed because it's determined from an antitrust perspective there are serious legal concerns," Khan said. "From a law enforcement perspective, that deterrence is absolutely a mark of our success. The more we can achieve deterrence, the more we can make sure that our resources are being deployed more effectively."
The FTC has also proposed a rule banning companies from using noncompete agreements in employee contracts. Khan said the FTC proposed the rule based on empirical evidence suggesting that the harms of noncompete agreements are not just on employees, but "on competition and economic growth as a whole."
"If you have startups, entrepreneurs or businesses that are looking to enter a market, sometimes they find that even if they're able to secure capital, they're not able to secure the necessary talent because the talent pool is locked up from noncompetes," she said.
The FTC received more than 26,000 comments on the proposed rule during a public feedback period. Khan said the FTC is processing the comments and will "move forward as appropriate."
Makenzie Holland is a news writer covering big tech and federal regulation. Prior to joining TechTarget Editorial, she was a general reporter for the Wilmington StarNews and a crime and education reporter at the Wabash Plain Dealer.
