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Joseph J. Simons, Director of the Federal Trade Commission's Bureau of Competition, today announced plans to conduct public workshops regarding modifications and improvements to the Commission's merger investigations process and its use of specific remedy provisions. The Commission will use this forum to solicit input from a broad range of interest groups including corporate personnel, outside and in-house attorneys, economists, consumer groups, and others who have participated in the FTC's or Department of Justice Antitrust Division's merger review process. These "brown bag" workshops will be held in Chicago, Los Angeles, New York, San Francisco, and Washington, D.C. during the next several months.

The workshops are being held in response to criticism and suggestions received by the FTC over the past several years regarding the burdensome requirements of the second request process and the length and criteria of the process for developing and negotiating remedies. Specific areas in which the Commission is seeking input include: the efficiency of the merger review process; the time and expense involved in the process; the perceived stringency of the remedy requirements; and the information that parties should provide during the review process.

"These workshops will be a great opportunity for the public to help us identify where we can improve our investigations and remedial efforts," commented FTC Chairman Timothy J. Muris, "and I invite all interested parties to participate in this review that Joe Simons has initiated."

To solicit maximum information, two sets of workshops will be held simultaneously: one focusing on merger investigations and the other focusing on remedies issues. The merger investigations workshops will focus on merger investigation practices, particularly FTC procedures for obtaining information and data used to assess the likely competitive effects of mergers and acquisitions. The remedies workshops will consider whether the agency's remedy provisions are necessary or sufficient and if the process through which they are negotiated can be improved.

Merger Investigations

The areas in which the FTC seeks input for merger investigations include:

The Initial Waiting Period

  • The use of voluntary information requests or access letters during the initial Hart-Scott-Rodino Act waiting period before issuance of any request for additional information or second request

The Content and Scope of the Second Request

  • Shortcomings or flaws in the model second request issued in 1995
  • The second request instructions on sorting or organizing responsive information
  • The preparation of privilege logs and the merging parties' use of side agreements concerning future divestitures

Negotiating Modifications to the Second Request

  • Suggestions for improving the second request modification process
  • Timing agreements between the FTC and the merging parties
  • The treatment of foreign-language documents
  • The FTC appeal procedure for resolving of disputes over modifications to the second request

Special Issues Concerning Electronic Records and Accounting or Financial Data

  • The use of e-mail and the associated burden or costs on the merging parties; this includes techniques for identifying the relevant e-mail and for collecting and transmitting it to the FTC for its analysis
  • The use of data or information from backup tapes or electronic storage systems and the associated burden or costs on the merging parties; this includes techniques for identifying the relevant backup or storage information and for collecting and transmitting it to the FTC for its analysis
  • Communications between the FTC and the merging parties' information-technology personnel, such as network administrators
  • The use of accounting or financial data for economic analysis of the merger or acquisition and the associated burden or costs on the merging parties; this includes techniques for identifying the relevant data and for collecting and transmitting it to the FTC for its analysis
  • Communications between the FTC and the merging parties' personnel knowledgeable about financial or accounting systems, such as controllers

Other Information or Data Gathering Methods

  • Information gathering from third parties, such as customers
  • Access to transcripts of investigational hearings or depositions conducted during the merger investigation.


To facilitate the discussion for the remedies workshops, the Bureau of Competition has published on its Web site,, a series of "Frequently Asked Questions About Merger Consent Order Provisions" ( These "FAQs" represent a review of the Commission's actions in the past and have been compiled from many years of negotiations between the FTC's staff and parties to horizontal mergers. The answers are drawn from prior cases, as well as positions set out by the Commission and its staff in speeches, articles, and elsewhere.

The remedies workshops will seek views from the public on such topics as:

The Package of Assets to Be Divested

  • How can the Commission assess whether a divestiture will be viable and thus remedy the competitive harm created by an acquisition?
  • What concerns arise when a divestiture does not constitute an ongoing business that has operated on a stand-alone basis?
  • Whether assets beyond those specifically used in the relevant market need to be divested in order to assure creation of a competitor that has all needed resources to compete effectively

The "Manner" of a Proposed Divestiture

  • What provisions should be included in an acceptable purchase agreement?
  • What kinds of provisions, including financing terms, raise issues of ongoing entanglements between the divesting party and the buyer
  • When might continuing obligations, such as supply agreements and technical assistance agreements, be required?
  • What kinds of provisions may give rise to concern that less than all required assets are being divested or that the divestiture may be less than "absolute"?

The Proposed Buyer of Divested Assets

  • What criteria should the Commission consider when reviewing a proposed buyer for assets to be divested?
  • Are certain types of buyers preferable?

The "Buyer Up Front"

  • When should the Commission require that the divesting party negotiate a firm divestiture contract with an identified buyer before the Commission will accept a settlement?

The Use of "Fix-it-First"

  • What benefits can be obtained by use of a "fix-it-first" approach, where the parties restructure an otherwise problematic transaction without entering into a Commission Order? What problems can arise in such a situation, and what recourse would the Commission have if the parties have not entered into a Commission Order? Are there specific industries in which the Commission ought to (or ought not to) consider the use of a "fix-it-first" approach?
  • The Department of Justice often enters into "fix-it-first" transactions. Have any problems arisen in those situations and what recourse have affected parties had? What were the benefits obtained through use of this process, for the market, and for the companies?

The Use of Crown Jewel Provisions

  • How do crown jewel provisions affect the ability of the parties to obtain or maintain financing for the proposed transaction?
  • Do crown jewel provisions have the effect of creating uncertainty that affects ongoing or potential customer or supplier relationships?

Third-party Rights

  • How should the Commission and parties deal with third-party rights under existing contracts?

The Risks to Competition and to the Parties

  • What cases highlight the risks to consumers of competitive harm arising immediately from the acquisition?
  • How should the Commission minimize the risk that assets to be divested will be diminished during the period prior to divestiture?
  • How should the Commission minimize delay in accomplishing a divestiture?
  • How can the parties minimize delay in accomplishing a divestiture?

Follow Up and Determining the Success of Our Remedy Efforts

  • Should the FTC require buyers of divested assets to report on their operations of the divested assets to permit the FTC to better determine whether the FTC's remedy provisions have achieved the objective of maintaining or restoring competition in the relevant market? What should those reporting obligations entail? For how long should they be in force?
  • How should the FTC measure the success of its remedy provisions?

Any one wishing to submit written comments regarding either of the workshop topics may do so at and .

The schedules and agendas for individual workshops will be announced as they become available on the FTC web site,

Contact Information

Media Contact:
Cathy MacFarlane
Office of Public Affairs
Staff Contacts:
Michael G. Cowie
Senior Litigation Counsel

Daniel P. Ducore
Assistant Director Compliance Division