In the world of international antitrust enforcement, the U.S. approach stands out dramatically in a “one of these things is not like the others” way – vesting broad and overlapping antitrust investigatory power in the hands of two federal antitrust enforcers – the Department of Justice and the Federal Trade Commission.
Longstanding efforts to render the antitrust processes of the DOJ and FTC similar and, more recently (through the One Agency Act) to bring antitrust enforcement entirely under one roof(the DOJ’s) appear to be very much alive again, particularly with the Republicans controlling both the White House and Congress, and with the legislation that would bring an end to this dualistic approach having been sponsored by an influential MAGA aligned Republican Senator – Mike Lee.
With the power to push through significant structure reform seemingly within reach, are the days of the FTC as antitrust enforcer numbered? Not likely . . . but first, a bit of context.
The One Agency Act would strip antitrust jurisdiction from the FTC, giving sole antitrust enforcement authority to the DOJ while keeping the FTC’s consumer protection jurisdiction in place. It, and earlier efforts to align the processes of the DOJ and FTC (even while keeping FTC in its role as one of the two antitrust enforcers) have in mind ensuring that the path to antitrust review and clearance should be a fairly uniform one or, in the One Agency Act’s case, a thoroughly uniform one in the hands of a single investigating body.
The problems the legislation is looking to solve for are significant, particularly in merger investigations. Although transactions in certain industries are routinely investigated by one or other agency (e.g., the DOJ pursuing telecommunications merger investigations, the FTC investigating pharmaceutical deals), not all deals are so clearly mapped. The process of determining which agency will have authority to investigate a transaction (somewhat confusingly called the “clearance” fight) can eat up days, weeks, and occasionally nearly all of the initial 30 day HSR waiting period. That is substantial lost time and, when it happens to a fast moving deal, can frustrate both the parties and the antitrust regulators, neither of whom can fully engage until the jurisdictional question is resolved.
On the surface, the conditions would appear to be ideal to push forward a Republican based reform, through both Republican controlled bodies of Congress and then to President Trump’s signature. And the vision of a more efficient process for businesses, after years of decrying the impact on business of a more business hostile environment at the FTC, would seem within reach. But, ironically, the strength of Republican control over key institutions now alters that picture in unanticipated ways.
Notably the body that is to be stripped of a significant part of its jurisdiction under this proposed legislation, the FTC, has a new Chair – the aggressive Democratic Chair Lina Khan has been replaced by the thoroughly Republican one, Andrew Ferguson.
And while it’s too early to tell how aggressive his enforcement vision will be, although Ferguson has been clear that he intends to push the FTC to aggressively pursue worthy cases, there is one thing that should not be at all in doubt – he is his President’s man.
Chairman Ferguson has signaled his alignment with the President in some very stark ways. President Trump and current DOJ leadership have underscored that they think “all” Presidential appointees are subject to removal at his discretion, regardless of what the implementing statute says on such things as the seven-year term of Commissioners or their being able to be terminated only for cause. Limitations on the President’s unbridled discretion are, in their view, unconstitutional.
That the President has this broad of a vision of his power is not all that surprising – that it is also the position of Chairman Ferguson, is. In his eyes, as well as the President’s, any limits on the ability to dismiss him, and his fellow Commissioners, despite clear statutory protections is “unconstitutional”.
While arguing for less job security as a Commissioner is one fairly compelling sign of Chairman Ferguson’s close alignment with the administration, it is one of many. Within days of being appointed as the FTC Chair he implemented the President’s anti-DEI policy at the FTC and when he did, stated, “I will work tirelessly to implement all of the President’s orders.”
Where does that leave the One Agency Act? Fundamentally, not in a very promising spot for its enactment. The FTC has tremendous power, much derived from the things that have driven support for the One Agency Act – the FTC’s easier standard for obtaining injunctions, its ability under Section 5 of the FTC Act to reach types of conduct not available to challenge by the DOJ, and its discretion to use its own administrative law courts either on their own or in conjunction with bringing suit in federal court). And that’s to say nothing of the ability to leverage staff, expertise and the energy of the FTC itself. With President Trump set to have, within months, a majority of three Republican Commissioners to two Democratic ones, and a Chair who styles himself as the champion of executing all of the President’s wishes, it does not take much imagination to see that the FTC and its overlapping antitrust jurisdiction is – for the new administration – probably starting to look more attractive these days. With the FTC available as a very powerful tool, pursuing the President’s priorities, the One Agency Act – and the smoother more predictable processes it envisions – will likely have to wait.
