FTC Announces Change in Merger Acknowledgement Policy

The Federal Trade Commission announced today that, beginning next week, the agency will publicly acknowledge that a particular merger or other transaction is being investigated by the FTC under Sections 7 and 11 of the Clayton Act in situations where a party to the transaction has disclosed its existence in a press release or other public filing. Reporters or others seeking information about the existence of an FTC antitrust investigation regarding a particular transaction should contact the FTC’s Office of Public Affairs at 202-326-2180.

The FTC said this exemption to its general policy of not disclosing investigations does not extend to any details about the investigation; nor does it affect the Commission’s confidentiality policies or practices regarding other types of investigations. In addition, the FTC said, the Hart-Scott-Rodino Act (which requires parties to certain large transactions to file documents describing the transactions with the federal antitrust agencies prior to consummating the deal) prohibits the agency both from disclosing whether a pre-merger filing has been received and from making public the actual pre-merger filings. The FTC said the new policy conforms closely to the policy of the Department of Justice’s Antitrust Division and will allow those with an interest in a matter to contact the appropriate agency.

The new policy is effective upon publication of a notice in the Federal Register, which should occur next week.

The Commission vote in this matter was 5-0, with Commissioner Mary L. Azcuenaga concurring in part and dissenting in part and issuing a statement in which she said: "The Commission long has followed a policy of declining to confirm the existence of its investigations [because public disclosure] can interfere with the conduct and successful resolution of such matters and . . . ?disclosure of the identities of businesses under investigation would cause those businesses severe economic injury even before the Commission determines whether there is reason to believe the law has been violated.’" She said, "I have been informed that the business community will have no objection to having the Commission confirm the fact that it is investigating a transaction even if the parties have not confirmed the fact of the investigation. I do not know the basis for this information. Assuming the information is correct, I support the new policy in its entirety, because the policy presumably would not result in the harm the Commission identified in 1977. Nevertheless I would have preferred to seek comment on this aspect of the new policy before adopting it."

Copies of the Federal Register notice announcing the new policy and Commissioner Azcuenaga’s full statement are available from the FTC’s web site at http://www.ftc.gov and also from the FTC’s Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 202- 326-2502. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.

(FTC Matter No. P950101)