Statement of Commissioner Mozelle W. Thompson
Concurring in Part in, and Dissenting in
Before the Senate Commerce, Justice, State
and the Judiciary
Today, the Commission has voted to approve testimony before the Senate Commerce, Justice, State and the Judiciary Subcommittee of the Appropriations Committee. Although I concur with most of this testimony, I am compelled to dissent from the discussion of the recently executed agreement between the Assistant Attorney General for Antitrust Charles James and Chairman Timothy Muris. I have previously expressed my concern about the Agreement which, among other things, seeks to allocate to each agency exclusive jurisdiction over certain merger reviews and other antitrust investigations.(1) I am unable to concur because of those concerns and my concern that the testimony's description of the facts and circumstances supporting the Agreement is misleading in several ways.
First, the testimony overstates the necessity for the Agreement by claiming that "major clearance disputes have become both more common and more contentious."(2) While I continue to support an inter-agency agreement that would streamline our clearance process, I believe that our clearance history shows that the total number of clearance contests between the two agencies has actually decreased 28% from 81 to 65 to 58 beginning in fiscal year 1999 and continuing through 2000 and 2001.(3) And more significantly, the agencies have improved the speed of granting clearances. This fact is demonstrated by the increased percentage of clearance requests cleared in 2001 compared to 1999 for three different time periods:
Perhaps more impressive than these facts is the fact that between 1995 and 2001 only a handful - one percent - of clearance requests were not resolved within 20 business days. Accordingly, while there may be room for clearance process improvement, the testimony may misrepresent the nature of clearance contests because the simple fact is that the antitrust agencies have already improved the clearance process substantially over recent years. Morever, it is unclear whether reallocating industries from one agency to the other is necessary to achieve greater efficiencies.(4)
Additionally, the Commission's clearance testimony omits important information about the process that led to the creation of the Agreement. For example, the testimony cites the January 18, 2002 Statement of Commissioners Orson Swindle and Thomas B. Leary for the proposition that the Chairman has authority to unilaterally effect administrative changes. But the testimony fails to note that this Commission has never voted to deem clearance matters administrative,(5) nor has it voted to approve the Agreement or the process which led to its creation - including the empaneling of a non-public advisory panel consisting of private antitrust attorneys. Similarly, the testimony cites letters from the ABA Antitrust Section, former agency officials, and the business community as supporting the Agreement. However, the testimony fails to state that while the authors of those letters supported improved clearance procedures, they did not approve the substance of the James/Muris Agreement or the process by which it was reached.(6)
For all of these reasons, I am concerned that an important portion of the Commission's testimony - the clearance discussion - is misleading and falls short of what this Subcommittee and the public deserve to know. Accordingly, I respectfully dissent from the clearance portion of the testimony.
1. See Statements of Mozelle W. Thompson, January 18, 2002 and March 5, 2002.
2. Testimony at pages 13-14.
3. As we approach the halfway point in fiscal year 2002, the agencies have contested clearance for only 18 matters.
4. Interestingly, the clearance testimony also implies that the convergence of certain technology and economic sectors has significantly increased clearance disputes and that allocating industries is needed to improve the clearance process. There is no evidence to show that drawing new industry lines will avoid future disputes when a product involved in a merger review or other investigation falls between any two assigned industries.
5. I doubt whether altering the Commission's concurrent enforcement responsibilities under Section 5 of the Federal Trade Commission Act or affecting the use of our exclusive powers under Section 6 of the Act, can be characterized as merely administrative. Nor would I concur that the negotiation of the Agreement is an appropriate subject for the "private lawmaking" it embodies. Also, I have not been provided with any information that would enable me to measure the budgetary ramifications of altering the Commission's responsibilities under the Agreement.
6. See, e.g., Letter to Charles A. James and Timothy J. Muris from Roxane C. Busey, Chair, Section of Antitrust Law (January 23, 2002) ("The Section supports the concept of such an agreement - without commenting on the specifics of the particular allocation agreement, which we have not seen, or the particular process by which it was reached."); Letter to Charles A. James and Timothy J. Muris from Robert Pitofsky, et al. (February 4, 2002) (A letter drafted by private attorney Joe Sims for signature by former agency officials states: "[The signatories take] no position on whether the assignments and reassignments in the draft proposal are appropriate...." See also Letter to Timothy Muris from The Business Roundtable, the National Association of Manufacturers, and the U.S. Chamber of Commerce (February 25, 2002) (Letter from business groups did not endorse the Agreement process and stated that the business groups believed it did not matter which agency reviewed particular matters). The fact that outside parties have expressed support for the concept of a procedural clearance agreement absent consideration of allocating industries casts doubt upon the necessity for an agreement as sweeping in scope as the one signed by Chairman Muris and AAG James.