According to Global Competition Review, several members of the antitrust bar have expressed concern that the Federal Trade Commission’s (FTC) decision to erase its name from the 2020 Vertical Merger Guidelines makes merger control in the U.S. less predictable. Antitrust partners Alicia Batts and Dylan Carson co-authored an article outlining the impact of this change where vertical merger enforcement now stands.
The authors explained that on Sept. 15, 2021, the FTC voted to withdraw the 2020 Vertical Merger Guidelines. On the same day, the Department of Justice (DOJ) issued a statement that it was not withdrawing its reliance on the guidelines but would continue to work with FTC on how they could be improved.
Thus, the authors detailed how this action resulted in the antitrust bar re-entering a period of uncertainty regarding vertical mergers and talked about the possible impact of this change for the competition bar and its clients.
The authors also provided a short history of vertical merger review and discussed the modern era of merger guidelines and litigation. They further addressed the genesis of the new vertical guidelines and vertical enforcement in the Biden era. Regarding vertical guidance in the interim, the authors assessed what might come next for antitrust, given that the FTC withdrew the vertical guidelines, and the DOJ has not.
In conclusion, the authors said, “There will be less predictability for vertical transactions before the FTC.” They added, “Until new official guidance is in place, building a robust case for why lower costs and innovation from a vertical merger will lead to lower prices or greater output and consumer benefits should be all the ‘guidelines’ merging parties need.”