Horizontal Merger Guidelines Review Project
Are Relevant Markets Ever Irrelevant? Comments on Questions 1, 2b, and 10a The issue of defining the relevant market often becomes the most time consuming and costly part of an antitrust case. The 1992 Horizontal Merger Guidelines describe the "hypothetical monopolist test" for defining the relevant market. This test asks whether a hypothetical monopolist of a good or set of goods (or of a geographic region) could profitably increase prices above the pre-merger level. In many cases, however, direct evidence is available that demonstrates a merger would create an anticompetitive effect. In those instances, direct evidence of anticompetitive effects may make the hypothetical monopolist test an unnecessary exercise. HHI Thresholds in the Horizontal Merger Guidelines, Comments on Question 9 The de-identified data supporting the FTC's Horizontal Merger Investigation Data report should be made publicly available so that private, interested parties may perform analyses, such as correlations or regressions, which could better measure the importance of the HHI calculation to an enforcement decision relative to other known factors. Such private-party analyses could then be used to help inform the Agencies on whether the current Guidelines' HHI thresholds are adequate or should be adjusted. The goal of additional analyses of this data would be to empirically establish whether current practice at the Agencies follows the existing Guidelines. If the analyses were to find that current practice is inconsistent with the Merger Guidelines HHI thresholds, then informed suggestions could be made using the new analyses as to what appropriate HHI thresholds might be.