DealLawyers.com Blog

On Monday, the DOJ and FTC announced the release of the final 2023 Merger Guidelines. The draft guidelines were published back in July. As expected, the guidelines formalize a “notable shift toward more aggressive merger control enforcement” as described in this White & Case memo. However, there were significant changes from the draft form. The memo attaches a redline showing all the differences and describes certain key changes as follows:

Final 2023 Merger Guidelines drop the July 2023 draft’s then-Guideline 6, which directly addressed vertical mergers

– The July 2023 draft Guidelines in then-Guideline 6 had identified mergers that result in a foreclosure share above 50% in a related market or those below a 50% foreclosure share that exhibit certain “plus factors” as “a sufficient basis to conclude that the effect of the merger may be to substantially lessen competition.”

– The final 2023 Merger Guidelines do not include this same language. Importantly, however, the final 2023 Merger Guidelines still address vertical mergers. Final 2023 Guideline 5 warns that vertical transactions that would give merging parties the ability and incentive to weaken or exclude rivals can violate the law.

Final 2023 Merger Guidelines drop the July 2023 draft’s then-Guideline 13, which contained broad catchall language

– The final 2023 Merger Guidelines also drop the draft’s then-Guideline 13 (“Mergers Should Not Otherwise Substantially Lessen Competition or Tend to Create a Monopoly”). This proposal had merely clarified that scenarios addressed in the other guidelines are “not exhaustive” of the mergers that may threaten competition. The DOJ’s and FTC’s decision to cut this proposal does not reflect a significant change from the July 2023 draft Merger Guidelines.

Final 2023 Merger Guidelines drop some restrictions on efficiencies from July 2023 draft Guidelines

– The final 2023 Merger Guidelines drop some restrictions on procompetitive efficiencies that had been included in Section 3.3 of the July 2023 draft Guidelines (“efficiencies are not cognizable if they will accelerate a trend toward concentration [] or vertical integration.”). The final 2023 Merger Guidelines still set a high bar for the DOJ and FTC to credit efficiencies.

We’re posting memos and other materials in our “Antitrust” Practice Area here on DealLawyers.com.

– Meredith Ervine