It seems that hardly a day passes without an antitrust issue ending up on the front page of the newspaper. In the last several months, politicians, government officials, and enforcers alike continue to focus on their desire for more robust antitrust enforcement and scrutiny of everyday commercial activities.
In the latest development, President Biden issued an expansive Executive Order on July 9, 2021 aimed at “promoting competition in the American economy.” Here is the Fact Sheet. The Executive Order includes 72 different initiatives and directs more than a dozen federal agencies to consider far-reaching policy considerations that the White House believes will enhance competition and protect consumers across many industries.
The Executive Order focuses on what it regards as excessive concentration and abuses of market power within labor markets, agricultural markets, broadband providers, Internet platform industries, health care markets (including insurance, hospital, and prescription drug markets), repair markets, and U.S. markets directly affected by foreign cartel activity.
Notably, the Executive Order does not put any specific policies into effect or establish any requirements now but instead directs federal agencies to consider policy and create new rules to implement the competition policy objectives of the Biden Administration. Although that process may take some time to develop, the Executive Order could have significant and far-reaching impacts on many aspects of the American economy.
The Executive Order establishes a White House Competition Council, led by the Director of the National Economic Council, to monitor progress on finalizing the initiatives in the Order and to coordinate the federal government’s response to the rising power of large corporations in the economy.
The Executive Order places strong emphasis on antitrust policy and calls on the Federal Trade Commission and the Department of Justice to take steps to enforce the antitrust laws “fairly and vigorously” – and more so than they have done in the past. In particular, the Executive Order seems to encourage the agencies to challenge previously consummated mergers and also explicitly encourages the agencies to consider revising existing vertical and horizontal merger guidelines with an aim of halting consolidation. President Biden stated during a recent press conference that “the experiment of letting giant corporations accumulate more and more power" failed and his Administration will have “no tolerance for abusive actions by monopolies, no more bad mergers that lead to mass layoffs, higher prices and fewer options for workers and consumers alike."
Labor markets will continue to receive scrutiny as the Executive Order encourages the FTC to curtail the unfair use of non-compete agreements, ban unnecessary occupational licensing restrictions that impede economic mobility, and consider revising prior agency guidance to prevent employers from collaborating to suppress wages or reduce benefits by sharing wage and benefit information with each other. To learn more, please join us for a webinar on this topic next week.
The Executive Order covers numerous other industries with a nexus to manufacturing. For example, the Executive Order includes provisions encouraging the FTC to adopt “right to repair” rules against restrictions on third-party repair or self-repair items. Notably, the Executive Order encourages regulations that would permit for do-it-yourself or third-party repairs of farm equipment while preventing manufacturers from using “proprietary repair tools, software, and diagnostics to prevent third-parties from performing repairs.” For a more in-depth analysis of the “right to repair issue,” please see our analysis here.
The list of initiatives is long and contains other directives from internet service, hearing aids, baggage fees, and food distribution systems to prescription drug costs, to name only a few. The Fact Sheet provides a good summary of the various policy objectives of the Executive Order. This will certainly be a space to watch in the coming weeks and months as the agencies work to carry out the Biden Administration’s far-reaching competition policy objectives.
[View source.]
