FTC approves Omnicom, IPG merger but says they can't coordinate to bar ads based on politics

• The merger between Omnicom and IPG will create the largest global ad agency holding group by revenue. The deal is still pending approval from regulators in the U.K.

Zoom in: The proposed consent order imposes restrictions "that prevent Omnicom from engaging in collusion or coordination to direct advertising away from media publishers based on the publishers' political or ideological viewpoints."

• It also prohibits agencies from accepting requests to direct advertising spend to a certain media publisher "based on political or ideological viewpoints or political content."
• Agencies are also prohibited from declining to do business with an advertiser based on their political or ideological viewpoints.

Between the lines: Advertisers are still allowed to dictate where their ads appear. Agencies will need to act with caution to avoid accusations of collusion or bias when considering an advertiser's targeting requests.

Of note: Earlier this year, the Trump administration fired the FTC's two Democratic commissioners. The remaining three commissioners are all Republican.

• The consent order passed by a 2-0-1 commission vote, with commissioners Andrew N. Ferguson and Melissa Holyoak voting in favor of the measure, while commissioner Mark R. Meador recused himself.
• It's unusual for orders to be passed by two votes within the FTC, but it's valid.

Yes, but: The consent order also contains fairly standard provisions barring anticompetitive coordination over conditions such as pricing, ad placement, and sponsorships, as well as helping execute advertisers' ad campaigns.

• Axios previously reported that despite concerns around politics, most of the FTC's inquiries into the merger with ad professionals were apolitical.

Reality check: Regulators rarely put in place merger provisions that specifically bar this type of coordination, but political pressure around allegations of ad groups penalizing conservatives has gained steam.

• Last year, House Judiciary Committee chair Rep. Jim Jordan (R-Ohio) sent letters to the CEOs of Omnicom and IPG as part of an antitrust investigation into whether ad agencies had colluded with the World Federation of Advertisers and the now defunct industry coalition Global Alliance for Responsible Media to boycott conservative media.
• Amid the chaos in Congress, the probe moved fully to the FTC, Axios reported last month.

• Jordan's investigation came months after he led a Congressional hearing about complaints that alleged GARM was colluding with ad-buying giant GroupM (now WPP Media) to discourage clients from buying ads in the Daily Wire because of its conservative politics.
• Last year, X sued the liberal watchdog group Media Matters for defamation, claiming one of its research reports contributed to an advertiser exodus. The FTC is now investigating the group over the same issue.

What they're saying: "Websites and other publications that rely on advertising are critical to the flow of our nation's commerce and communication," Daniel Guarnera, director of the FTC's Bureau of Competition, said in a statement.

• "Coordination among advertising agencies to suppress advertising spending on publications with disfavored political or ideological viewpoints threatens to distort not only competition between ad agencies, but also public discussion and debate."
• The CEOs of Omnicom and IPG said in separate statements that the move was an important step toward completing the proposed acquisition.
• "We continue to look forward to obtaining the remaining regulatory approvals and closing in the second half of this year, consistent with our expectations when we announced this transaction," Omnicom CEO John Wren said.

What's next: The public has 30 days to submit comments on the proposed consent agreement package. They will appear on Regulations.gov after processing.

Editor's note: This story was updated with statements from Omnicom and IPG.