February 26, 2024

Biden Announces New Rules To Cope With Corporate Consolidation

President Joe Biden’s administration is poised to roll out new guidelines Wednesday that will determine when the federal government will challenge corporate mergers, a major step long anticipated by antitrust advocates and likely to wreak havoc on business big.

Biden will announce the new guidelines, along with a handful of other new antitrust policies, at his fifth meeting. White House Competitiveness Council on Wednesday.

The Federal Trade Commission and the Justice Department’s antitrust office are set to release a draft of the new guidelines, which aim to modernize how the agencies review mergers and acquisitions in order to focus the market and reduce anti-competitive behavior in key corporate sectors.

The new guidelines, led by FTC Chairman Lina Khan and Assistant Attorney General Jonathan Kanter, are part of the Biden administration’s economic policy to dismantle a 40-year regime of laissez-faire free-market economics established under President Ronald Reagan.

Antitrust enforcement agencies in the Reagan administration adopted a lax review standard that encouraged mergers and acquisitions and looked favorably on monopolies to promote market efficiency. This standard was adopted bipartisanly and has dominated antitrust enforcement ever since.

The new guidelines take into account the effects of a merger on workers, vendors, corporate power and markets, while setting new rules for mergers involving digital platforms. They are likely to usher in a new era of antitrust enforcement.

“As markets and commercial realities change, it is imperative that we adapt our law enforcement tools to keep pace so that we can protect competition in a way that reflects the complexities of our modern economy, ” Kanter said in a statement. “Simply put, competition looks different today than it did 50 – or even 15 – years ago.”

This major policy shift comes after Biden appointed Khan and Kanter — noted antitrust hawks — within months of his inauguration. He released the executive order on competition policy which required rewriting the compounding guidelines and informed policy changes at nearly every federal agency since.

President Joe Biden speaks at a meeting of his White House Competitiveness Council on February 1 in the East Room of the White House.

Andrew Harnik/Associated Press

The last attempt to revise the compounding guidelines took place in 2020 during the Donald Trump administration. But the Biden administration, in efforts led by Khan and Kanter, soon scrapped those rules for failure to reflect accurate economic thinking and data, and set out to create a fresh rewrite.

That process produced more than 5,000 public comments, far more than the 30 or so comments from corporations the agencies received during previous updates. The draft guidelines will be available for public comment for 60 days.

The merger guidelines are not the only new antitrust policies announced by the administration on Wednesday. In addition, the Department of Housing and Urban Development announced plans to crack down on junk fees in the rental housing market.

In March, HUD Secretary Marcia Fudge wrote to leaders in the rental housing industry to push them to crack down on hidden and excessive fees, such as rental application fees and hidden fees for trash collection or other services that may tenants to assume that they are built into the rent. .

Three digital real estate platforms — Zillow, Apartments.com and AffordableHousing.com — now plan to include these often-hidden fees when they list prices for rental properties.

The US Department of Agriculture also announced Wednesday that it has partnered with the attorneys general of 32 states and the District of Columbia to target anti-competitive behavior in food markets.

The partnership would allow cooperation in competition laws that seek to reduce food prices, combat price gouging, increase access to food and prevent anti-competitive behavior that threatens food supply chains.

Leave a Reply

Your email address will not be published. Required fields are marked *