DOJ, FTC Issue First Joint Vertical Merger Guidelines
The first joint DOJ/FTC vertical merger guidelines, issued Tuesday, should give more transparency and predictability about how government views such deals, DOJ said. It said the agencies might apply both horizontal and vertical merger guidelines in a deal evaluation since…
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transactions often present elements of both. It said when agencies identify a potential competitive concern in a relevant market, they will also specify one or more related products. It said the guidelines identify conditions under which a vertical combination wouldn't require an extensive investigation because the deal wouldn't create or enhance the combined firm's ability or incentive to hurt rivals. TechFreedom said while the new guidelines recognize vertical deals can be pro-competition and reject creating a presumption against vertical combinations in the tech sector, they also "create substantial uncertainty by eliminating a safe harbor for smaller vertical mergers.” The American Antitrust Institute said including the safe harbor “would have impaired vertical merger enforcement,” but the guidelines don't provide guidance supporting strong enforcement, such as a presumption certain vertical combos are likely to harm competition but rebuttable by evidence that the deal wouldn't enhance market power.