FTC, DOJ Seek Comment Through Feb. 11 on Draft Vertical Merger Guidance

for either agency. “Greater transparency about the complex issues surrounding vertical mergers will benefit the business community, practitioners, and the courts,” said Chairman Joe Simons. The guidelines will “provide more clarity and transparency on how we review vertical transactions,” said DOJ Antitrust Division Chief Makan Delrahim. The draft guidelines aren’t “supported by an analysis of past enforcement decisions, perpetuate an overdependence on theoretical models, and do not reflect all of the ways that competition can be harmed,” said Commissioner Rohit Chopra. He asked that the 1984 non-horizontal merger guidelines be rescinded due to economic shifts in the past 40 years. “Increasing concentration, declining new firm formation, and other market trends necessitate a modernization of vertical merger review,” he said. Commissioner Rebecca Kelly Slaughter said her biggest concern is an apparent safe harbor indicating agencies are unlikely to challenge vertical deals if the parties “have a share in the relevant market of less than 20 percent, and the related product is used in less than 20 percent of the relevant market.” She said the 20 percent threshold lacks evidence and justification. Commissioner Christine Wilson agreed the 1984 guidelines need to be updated and replaced. She suggested commenters weigh the safe harbor and its threshold, asking if agencies should focus on “oligopoly markets.”