Gary Shapiro CEO at Consumer Technology Association | Official website
ARLINGTON, Va. (June 5, 2024) – The Consumer Technology Association (CTA)® has released a new study criticizing the 2023 Merger Guidelines issued by the U.S. Department of Justice (DOJ) and the Federal Trade Commission (FTC). These guidelines have been used for over 50 years to evaluate proposed mergers and transactions.
The report, titled “The 2023 Merger Guidelines: A Giant Leap in the Wrong Direction,” was prepared by Dr. Daniel P. O’Brien of Compass Lexecon at CTA's request. According to the study, previous revisions of the Merger Guidelines were successful due to their reliance on economic principles and past experiences of the FTC and DOJ in applying these guidelines. The report argues that by deviating from established antitrust standards, the 2023 guidelines introduce unpredictability and likely increase market costs.
The report suggests that the new guidelines will prevent beneficial mergers essential for market economies to benefit society. It claims that blocking such transactions will harm competition through higher prices, reduced innovation, lower quality, decreased wages, and other negative effects, ultimately reducing GDP.
“This report affirms what CTA has long said – the new merger guidelines represent an anti-merger bent by this Administration,” stated Gary Shapiro, CEO of CTA. “This study shows that the Administration’s anti-merger bias prioritizes unwarranted skepticism of transactions by companies of all sizes while giving short shrift to entrepreneurial companies that benefit from a healthy transactional market and consumers who benefit from an innovative economy.”
CTA advocates for merger guidelines that are clear, durable, provide insight into objective merger review considerations, and respect longstanding antitrust precedent. According to CTA, the 2023 Merger Guidelines fail to meet these objectives and will negatively impact procompetitive transactions particularly affecting smaller companies and startups driving consumer-benefiting innovation.
The full report can be viewed here.
