Bi-partisan coalition suggests making improvements to reform measures and clarifying that states are sovereigns that stand on equal footing with federal enforcers under federal antitrust law.
A bi-partisan coalition made up of the attorneys general (AGs) of 30 states and the District of Columbia and Guam is urging House and Senate leaders to remember the state enforcers when moving forward with a proposed overhaul of the federal antitrust laws. In a September 20 letter, the AGs offered their assistance in the process, including serving as resources for suggestions on any of the proposed laws based on their past enforcement experiences.
The state AGs commended Congress for “working to ensure that federal antitrust laws remain robust and keep pace with that of modern markets” and encouraged the lawmakers “to continue making improvements to these important measures.” They pointed to six measures that are part of a legislative package approved by the House Judiciary Committee in June: (1) the Ending Platform Monopolies Act of 2021 (H.R. 3825); (2) the American Choice and Innovation Online Act of 2021 (H.R. 3816); (3) the Platform Competition and Opportunity Act of 2021 (H.R. 3826); (4) the Augmenting Compatibility and Competition by Enabling Service Switching Act of 2021 (H.R. 3849); (5) the Merger Filing Fee Modernization Act of 2021 (H.R. 3843); and (6) the State Antitrust Enforcement Venue Act of 2021 (H.R. 3460).
Venue protections for state AGs. The letter comes just days before the Senate Judiciary Committee is set to vote on the bi-partisan State Antitrust Enforcement Venue Act of 2021 (S. 1787), which is identical to H.R. 3460. The measure would put the state enforcers on “equal footing with federal enforcers in deciding where, when, and how to prosecute cases,” according to a June letter to federal lawmakers by state AGs. The National Association of Attorneys General has pushed for this measure, which would keep state antitrust enforcement actions in the court selected by the enforcer by creating a carveout from the Judicial Panel on Multidistrict Litigation process so that state enforcement actions are not transferred to a multidistrict litigation at the request of the defendants. A Judiciary Committee meeting to consider the measure is scheduled for September 23.
Merger filing fees. Another measure that looks likely to move forward is the Merger Filing Fee Modernization Act. The Senate version (S. 228), which was co-sponsored by Sen. Amy Klobuchar (D., Minn.), Senate antitrust subcommittee chair, and Chuck Grassley (R., Iowa), subcommittee ranking member, was passed by the Senate as part of the U.S. Innovation and Competition Act of 2021 (S.1260) in June. It would increase Hart-Scott-Rodino or HSR Act premerger notification fees on particularly large deals and authorize increased appropriations for the two federal antitrust agencies.
Measures aimed at changing tech platforms. Some of the other measures in the House package are more controversial. Critics of the Ending Platform Monopolies Act of 2021 and the American Choice and Innovation Online Act of 2021 suggest that these measures will drive up costs for consumers and deprive them of innovative technologies.
The Ending Platform Monopolies Act is intended to stop a dominant online platform’s leverage of its monopoly to disadvantage competitors. Dominant online platforms, such as Google, Apple, Amazon, and Facebook, would be prohibited from simultaneously owning another line of business when that dual ownership creates a conflict of interest, according to a statement released by the bill’s sponsor—Rep. Pramila Jayapal (D., Wash.). Companies in violation could have to divest lines of business where their gatekeeper power allows them to favor their own services or disadvantage rivals. The American Choice and Innovation Online Act takes aim at self-preferencing by online platforms.
Opponents of these measure point out that “Rep. Jayapal’s bill would force free apps like Google Maps, YouTube, WhatsApp, Instagram, LinkedIn, iMessage, and FaceTime to be divested from their parent companies, putting at risk these free services and making them less accessible to the public.” They add that the American Innovation and Choice Online Act “would ban Google from displaying YouTube videos in search results; ban Alexa users from ordering goods from Amazon; block Apple from preinstalling “Find My Phone” and iCloud on the iPhone; ban Xbox’s Games Store from coming with the Xbox; and ban Instagram stories from Facebook’s news feed.”
The Augmenting Compatibility and Competition by Enabling Service Switching (ACCESS) Act is intended to promote competition online by lowering barriers to entry and switching costs for businesses and consumers through interoperability and data portability requirements. The Platform Competition and Opportunity Act would make it much tougher for dominant platforms to acquire upstarts.
AGs who signed on. The AGs who signed on to the letter to Congress are from the following states and territories: California, Colorado, Connecticut, Delaware, Hawaii, Idaho, Illinois, Iowa, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Hampshire, New Mexico, New York, North Carolina, North Dakota, Oregon, Pennsylvania, Rhode Island, Tennessee, Utah, Vermont, Virginia, Washington, Wisconsin, the District of Columbia, and Guam.
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