Feb 10, 2020 - Technology

Hawley seeks overhaul of the Federal Trade Commission

Sen. Josh Hawley, (R-Mo.). Photo: Chip Somodevilla/Getty Images.

GOP Sen. Josh Hawley's frustration with the FTC's policing of the tech industry has prompted him to propose taking the more-than-100-year-old agency off of merger reviews and turning what remains into a wing of the Justice Department.

The big picture: The FTC has been under fire from both Republicans and Democrats calling for tougher action on Big Tech; Hawley's pitch is to hand the agency's competition authority to the DOJ's antitrust division so that a reimagined FTC could hone its focus on privacy and other digital issues.

Yes, but: Relocating the agency, created in 1914, to a branch of the Justice Department is a tall order and it's unclear if Hawley's idea will gain any support.

Details: Hawley says his plan would make the FTC directly accountable to the Justice Department while giving it special authority to address digital markets.

  • Rather than a 5-member commission, the FTC would be run by a Senate-confirmed director who would report to the DOJ's Associate Attorney General.
  • The DOJ's antitrust division would take over review of any mergers and acquisitions that might otherwise fall to the FTC, ending the overlapping jurisdiction that has been a source of congressional complaints.
  • The proposal instead calls for the creation of a "digital markets research section" within the FTC that would conduct studies of the marketplace and bolster DOJ litigation.
  • To increase enforcement, the proposal would give the FTC authority to limit the amount of data firms can collect, enforce new data portability and interoperability requirements, and impose civil penalties for first-time violations of those new rules.

What they're saying: "The FTC isn't working," Hawley said in a statement. "It wastes time in turf wars with the DOJ, nobody is accountable for decisions, and it lacks the 'teeth' to get after Big Tech's rampant abuses. Congress needs to do something about it."

What it doesn't do: Hawley shot down calls for the creation of a brand-new agency to police tech companies, saying his overhaul of the FTC is the better answer.

What's next: Legislation based on the proposal will come in short order, according to a Hawley aide.

Go deeper

FTC reviewing a decade of Big Tech acquisitions

Statue outside FTC headquarters in Washington. Photo: Chris Maddaloni/Roll Call/Getty Images

The Federal Trade Commission announced Tuesday it is investigating acquisitions made by Amazon, Facebook, Apple, Microsoft, and Alphabet/Google from 2010 on.

Why it matters: As pressure mounts to regulate Big Tech companies as monopolies, the FTC is one of two arms of the federal government empowered to enforce antitrust law, along with the Justice Department.

Big Tech's small deals pose a quandary for regulators

Illustration: Sarah Grillo/Axios

As regulators review a decade of tech industry acquisitions for signs of monopolistic behavior, proposing remedies is going to be a tough challenge.

Why it matters: Tech companies like Google and Facebook grew giant in part by rolling up startups that are now fully integrated into their businesses. Despite heated antitrust rhetoric, it would be a tall order for regulators to reverse hundreds of deals or force divestitures of the essential business lines those transactions helped build.

Big Tech braces for sprawling FTC acquisitions review

Illustration: Eniola Odetunde/Axios

The Federal Trade Commission announced Tuesday it will review the past decade of takeovers by tech giants Alphabet, Amazon, Apple, Facebook, and Microsoft. Not only the large ones, but also the hundreds of smaller ones that didn't trigger automatic antitrust reviews.

Why it matters: Apparently the FTC thinks it has a technique for getting toothpaste back into the tube. And that's before one considers the knotty logistics of unwinding something like Facebook/Instagram or some random Google acqui-hire from 2015.