As Yogi Berra reputedly said, “It’s tough to make predictions, especially about the future.” But that is precisely the job Congress gave to antitrust enforcers nearly 100 years ago when it passed the Clayton Act and established the Federal Trade Commission, in part, to enforce it. By its terms, the Clayton Act was designed to deal with antitrust violations before they occur, to address them in their incipiency.
From the beginning, merger enforcement has been about predicting the future. In remarks given today before the Advanced Antitrust Institute, I described the process by which we look at the facts of each case to predict with some level of confidence—but not absolute certainty—the likely competitive effects of a transaction. A forward-looking approach may reveal a competitive concern if one of the merging parties is not currently making sales but is already having an effect on the behavior of firms in the market. An acquisition may substantially lessen competition by eliminating a future competitor whose entry, once it occurs, would have a beneficial impact on competition. Such an acquisition could be particularly problematic if the future entrant is working on a product that customers would likely view as superior to existing products. Finally, moving along the continuum, the Commission has identified concerns where neither of the merging parties has a commercially available product yet both are two of only a few likely entrants into a future market.
We do not use a crystal ball to make these predictions. We use facts: documents from the merging parties, analyses from third parties, the views of customers and other market information. Assessing what future conditions will be is not easy. But with requisite humility and open-mindedness, antitrust enforcers will continue to employ rigorous fact-finding and analysis to do as much, just as the Clayton Act requires that we do.