U.S. antitrust consolidation proposal falters
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Corporate America will continue to serve two antitrust masters, after Rep. Jim Jordan (R-Ohio) yesterday backed off a plan to remove the FTC's antitrust authority and consolidate (most of) those powers in the Justice Department.
Why it matters: This illustrates how antitrust politics have changed in the past 100 days.
- Jordan, who chairs the House Judiciary Committee, is a longtime antitrust enforcement antagonist — but his message resonated more with Republicans when Lina Khan was leading the FTC.
- Current FTC chair Andrew Ferguson called the White House to pressure Jordan to drop his proposal, which he'd introduced as an amendment during reconciliation, Axios Pro's Ashley Gold reports. The move worked.
The big picture: The idea of having only one U.S. antitrust regulator isn't new.
- We discussed it here in 2023, noting the burden on companies that often don't know which agency is examining their proposed transaction until a press leak.
- It's been supported by Trump's former DOJ antitrust boss Makan Delrahim, now a partner with Latham & Watkins, who tells me that it still "makes sense."
- Opponents have argued that there's less actual overlap than it may appear, and that the two agencies serve complementary functions.
Zoom in: Jordan's effort was killed by politics, but also had some substantive issues.
- The FTC has something called Section 5, mandated by Congress, which lets it go after unfair or deceptive trade practices. We've seen this used in cases against pharmacy benefits managers and Amazon.
- But Jordan seemingly would have stripped the FTC of antitrust enforcement responsibilities and funding without transferring Section 5 authority to the DOJ (save for continuing existing actions). As such, Section 5 would have been defanged.
Look ahead: There's been a bill circulating through Congress since 2021 that would merge antitrust enforcement under DOJ, and it does appear to transfer Section 5 authority.
- At the same time, some believe that the legislation would ultimately lessen effective enforcement.
