Bloomberg reports that “the US Federal Trade Commission plans to make wider use of its 1914 founding statute to police anticompetitive behavior by companies in the internet age,” issuing a new policy statement signaling its intention to prevent “unfair methods of competition.
“FTC Chair Lina Khan said the policy, which re-affirms Section 5 of the FTC Act, will effectively reactivate the FTC’s authority to police conduct, especially in online markets.”
“In the digital economy, we’ve seen time and time again, there’s a real premium for businesses to capture the market as quickly as they can,” Khan said. That “can lead businesses to play fast and loose with the rules.”
The National Grocers Association (NGA) responded to the announcement this way:
“NGA is encouraged by the FTC’s policy statement that price discrimination and abuses of market power, including violations of the Robinson-Patman Act, may violate section 5 of the FTC Act. In the generation that laws against economic discrimination have been ignored, dominant food retailers have grown bigger and bigger, taking advantage of their size to amass greater power, and in turn pressuring their suppliers and limiting customer options. We look forward to working closely with the FTC to ensure a diverse and competitively robust food retail marketplace that benefits stakeholders throughout the food supply chain, including independent community grocers, wholesalers, manufacturers, suppliers, farmers, and most importantly, consumers.”
KC’s View:
Expanding the definition of antitrust enforcement – or bringing it back to the FTC’s original definition – probably isn’t good news for merger or acquisition minded companies. The FTC seems to be drawing a line … some might say moving the goalposts – and companies are going to have to adjust.
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