February 15, 2023

Antitrust: The FTC Wants More Time for Merger Reviews

In a statement accompanying the FTC’s annual report to Congress on the HSR Act, the Democratic commissioners again called for legislation extending the time periods for review of HSR filings:

We continue to recommend that Congress revisit statutory timelines imposed by the HSR Act on the agencies. The 30-day window provided for the agencies to assess whether a transaction warrants close investigation and the 30-day window in which we must decide whether to challenge a transaction after parties certify that they have “substantially complied” with our inquiries are no longer adequate.

Since the HSR Act was passed in 1976, the volume and complexity of information and data produced by merging parties have increased by several orders of magnitude. The fact that the FTC routinely resorts to voluntary timing agreements with merging parties to provide the necessary time for staff review is further evidence of the inadequacy of the enabling statutory timelines. We should not have to rely on permission from merging parties to have enough time to do the work required by law.”

In support of their position, the commissioners note that the FTC’s report confirms that the volume of notified transactions surged by 115% in 2021 to “historic levels,” and contend that the agency “simply [does] not have the capacity to keep up with the markets in terms of the scrutiny mergers should receive.”

The sole Republican commissioner, Christine Wilson, submitted a statement of her own in which she basically told her colleagues that it’s their own fault that the HSR review timeline is a problem:

For decades the timelines did not create problems for the agencies. Parties routinely entered timing agreements with staff that provided adequate time for investigations. But, early in the current administration, the Commission flouted a negotiated timing agreement after the parties voluntarily extended the review period several times. The Commission also took affirmative steps to increase the burden, heighten the risk, and increase the uncertainty attendant to the HSR process.

Commissioner Wilson punctuated her remarks by resigning from the FTC and publicly breaking a whole lot of furniture on her way out the door.

John Jenkins