The surprise merger between the PGA Tour and Saudi Arabia's Public Investment Fund (PIF) has raised concerns on and off the links over potential antitrust violations and human rights.
The merger was described as necessary to grow the sport by PGA Tour and LIV/PIF officials when it was announced June 6. The move also ends multiple antitrust lawsuits the two organizations have filed against each other since LIV formed in late 2021. Criticism of the merger was immediate, with critics claiming LIV is an attempt by the Saudi government to distract from its record of human-rights abuses and connection to the Sept. 11, 2001 terrorist attacks against the U.S. and the PGA Tour's alleged monopoly and anti-competition behavior.
U.S. lawmakers Sens. Elizabeth Warren (D-Mass.) and Ron Wyden (D-Oregon) sent a letter June 14 to the U.S. Department of Justice in which they expressed concerns on the merger's impact on competition, its potential violation of antitrust laws and its association with the Saudi regime in light of the country's human rights record. The senators asked the DOJ's Antitrust Division to "closely scrutinize" the deal and to "oppose it if it would reduce competition in violation of antitrust law."
“The PGA-LIV deal would make a U.S. organization complicit – and force American golfers and their fans to join this complicity – in the Saudi regime’s latest attempt to sanitize its abuses by pouring funds into major sports leagues," the senators wrote in the letter. "Significantly, the deal appears to have a substantial adverse impact on competition, violating several provisions of U.S. antitrust law, regardless of whether the deal is structured as a merger or some sort of joint venture."
The senators cited sections of the Sherman Act as showing the merger would violate antitrust laws, including being in violation if if it is considered a joint venture that grants the PGA Tour and PIF substantial control over various aspects of U.S. commercial golf operations. Section 2 of the Sherman Act comes into play, the senators write, as the PGA Tour's intentions to eliminate competition and monopolize professional golf raise concerns about anticompetitive practices. The merger's potential to reverse the trend of increased tournament prizes and grant monopsony power over golfers also raises red flags. Finally, Section 7 of the Clayton Act, which prohibits mergers that reduce competition or create a monopoly, is relevant in assessing the legality of the deal.
Warren and Wyden also state the merger would allow the Saudi government to "sportswash" its "egregious" human rights record. The regime has been connected to prosecutions of peaceful protestors; routine executions of individuals, including children, for robbery and drug-related crimes; the murder of an American journalist; involvement in the Sept. 11, 2001 terrorist attack on the U.S.; and other abuses.
Warren called out the DOJ in a June 15 tweet, writing “It’s powerfully important for @TheJusticeDept to follow the facts to enforce violations of antitrust law — including for the PGA-Saudi deal. A new golf monopoly would reduce competition, potentially raising prices for fans and lowering pay for golfers,” said Warren in a Tweet.
The DOJ's Antitrust Division announced June 15 that it had informed the PGA Tour that it is reviewing its proposed merger with LIV/PIF, Reuters, CNBC and other news organizations reported.
