Competition Matters


HSR threshold adjustments and reportability for 2017

When Congress passed the Hart-Scott-Rodino Antitrust Improvements Act of 1976, it created minimum dollar thresholds to limit the burden of premerger reporting. In 2000, it amended the HSR statute to require the annual adjustment of these thresholds based on the change in gross national product. As a result, reportability under the Act changes from year to year as the statutory thresholds adjust. The PNO fields many questions about the upcoming adjustments to the HSR thresholds from parties whose transactions may take place around the time of the revisions.

Looking back (again) at FTC merger remedies

The newly released Remedy Study is the culmination of nearly two years of effort by FTC staff to look back at Commission merger orders from 2006 through 2012. We looked at 89 merger orders affecting 400 markets, with 79 divestitures to 121 buyers. We evaluated 50 of those orders using a case study method, interviewing nearly 200 businesses in a wide range of industries and collecting sales data from almost that many.

Have a plan to comply with the bar on horizontal interlocks

With some exceptions, Section 8 of the Clayton Act prohibits the same individual from serving as an officer or director of two competing corporations. Like other portions of the forward-looking Clayton Act (including Section 7 with its proscription on mergers that are likely to harm competition), Section 8 was designed to “nip in the bud incipient violations of the antitrust laws by removing the opportunity or temptation to such violations through interlocking directorates.” U.S. v. Sears, Roebuck & Co., 111 F. Supp. 614, 616 (S.D.N.Y. 1953).

A little piece of paper goes a long way to promote contact lens competition

More than 40 million U.S. consumers benefit from contact lens competition. Demand for contact lenses has been growing over the past decade, and there are more places for consumers to shop for contact lenses and refill their prescriptions – in-person from eye-care providers, optical chains, and wholesale clubs, and on-line as well. Innovation has improved the comfort and convenience of contact lenses, and many people have switched from one-year lenses to daily disposable lenses.

Taking a hard look at the asset package

On Monday, the FTC accepted for public comment a proposed consent order involving a consummated merger in the eye care industry. According to the complaint, Valeant Pharmaceuticals’ 2015 acquisition of Paragon Holdings reduced competition for polymer discs (aka buttons) used to make three types of rigid gas permeable (hard) contact lenses.

Competitive job markets offer more than just fringe benefits

Looking for a new job can be stressful, whether you are a new worker applying for your first job or a highly trained professional seeking to advance in your career. The last thing a job-seeker should have to worry about is a back-room deal among employers that keeps her from getting the job of her dreams or from being offered a fair salary.

LBOs and the size of transaction test

The Premerger Notification Office is often asked to give guidance on how to determine the value of a proposed merger or acquisition in light of the size of transaction test. The size of transaction test excludes transactions from the reporting requirements of the Hart-Scott-Rodino Act if they are valued below the annually adjusted dollar threshold. The current size of transaction threshold is $78.2 million.

New and improved HSR Form Instructions – plus filing by DVD

On August 26, 2016, the FTC, with the concurrence of the Antitrust Division of the Department of Justice, took steps to make the process of completing and submitting Hart-Scott-Rodino premerger notification filings easier. The effective date of the new rules is today, September 1, 2016.

A compliance check for collaborators who also compete

Last week, Fortiline settled charges that it invited a competing seller of ductile iron pipe (DIP) to fix prices. This is the first case in which the FTC has challenged an invitation to collude by a firm that is in both a horizontal relationship (i.e., direct competitor) and a vertical relationship (i.e., manufacturer-distributor) with the invitee.

Snapshots vs. panoramic views of merger enforcement

Today the FTC and DOJ released the 38th Annual Hart-Scott-Rodino Report, which details the agencies’ merger review and enforcement program for Fiscal Year 2015 (October 1, 2014 through September 30, 2015). This report, like the 37 previous versions, is a snapshot of one year’s worth of HSR filings, Second Requests and merger enforcement actions, including HSR compliance and merger cases filed by the agencies in federal court.

New BC trial chief

I am happy to announce that Chuck Loughlin will replace Tara Reinhart as Chief Trial Counsel for the Bureau when Tara leaves the Commission later this week.  Chuck joined the Bureau in September 2015, as the Deputy Chief Trial Counsel of the litigation group, bringing over 20 years of experience in antitrust litigation, first at Howrey LLP and then at Baker Botts, where he was a partner in the antitrust group.

What does it take to settle a merger case?

Look at any recent merger settlement accepted by the Commission and the answer is clear: An acceptable merger remedy must eliminate the potential for anticompetitive effects that would likely occur if the merger were to proceed. Typically this means creating another competitor to take the place of one of the merging companies so that customers are not harmed by the merger. In short, a merger remedy must fix the specific competitive problems created by the merger.

Inflation increases for maximum civil penalty amounts

Last year, federal agencies, including the FTC, were instructed to adjust the maximum civil penalties for violations of laws they enforce. The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 requires agencies to adjust penalty amounts using the “catch-up” inflation adjustment methodology contained in the Act.