DealLawyers.com Blog

Here is news from this Gibson Dunn memo: On August 19th, the DOJ and FTC issued revised Horizontal Merger Guidelines. The release of the 2010 Guidelines marks the first major changes to the Guidelines in over 18 years; they will replace the 1992 Guidelines (which were subsequently amended in 1997).

In announcing the release of the 2010 Guidelines, Christine Varney, Assistant Attorney General in charge of the DOJ’s Antitrust Division, explained that the revisions were meant to “provide more clarity and transparency” into how the federal antitrust agencies evaluate the likely competitive impact of mergers and were intended to “provide businesses with an even greater understanding of how [the agencies] review transactions.” The FTC vote approving the 2010 Guidelines was 5-0. Chairman Leibowitz issued a written statement, noting that “the new Guidelines provide a clearer and more accurate explanation to merging parties, courts, and antitrust practitioners of how the agencies review transactions.”

The guidelines explicitly anticipate that revisions will be required “from time to time to reflect changes in enforcement policy or to clarify aspects of existing policy.” There has never been such a long interval between major guidelines updates since they were first issued in 1968. Thus, it came as little surprise when, in September 2009, the DOJ and FTC announced that they would jointly explore whether the guidelines should be revised. A series of workshops followed, and the FTC issued proposed revisions for public comment on April 20, 2010.

Like the prior guidelines, the 2010 Guidelines purport to describe the analytical process that the U.S. antitrust enforcement agencies use to investigate and decide whether to challenge proposed horizontal mergers and acquisitions. As the title denotes, the guidelines address only horizontal mergers (i.e., transactions between competitors or potential competitors). They do not address possible vertical issues, which may arise in mergers between firms that do not compete, but operate at different levels within the same supply chain. Nor do the 2010 Guidelines address or modify potential reporting requirements under the Hart-Scott-Rodino (“HSR”) Act. As was the case with previous versions of the guidelines, the 2010 Guidelines apply regardless of whether the transaction is HSR reportable and whether or not the deal has closed.