MSCI Joins Coalition Asking FTC, DOJ To Extend Merger Rule Comment Period

The Metals Service Center Institute (MSCI), U.S. Chamber of Commerce (USCC), and a coalition of more than one dozen other groups have asked the U.S. Federal Trade Commission (FTC) and the U.S. Department of Justice (DOJ) to extend the comment period on the two agencies’ proposed merger guidelines.

The coalition asked for a minimum of an additional 60 days.

The letter argued, “An extension would serve the interests of both the public and the agencies by allowing adequate time for more fulsome responses to the proposed revisions to the merger guidelines, which are designed to reshape U.S. merger policy and capital markets.”

The letter explained that a typical year sees more than 2,000 mergers whose aggregate value approaches $3 trillion and noted, “the draft merger guidelines have the potential to impact all of these transactions.”

The draft rule, available here, outlined 13 guidelines the two agencies said would provide “greater depth … when analyzing” mergers. Those 13 proposed guidelines are:

• Mergers should not significantly increase concentration in already-highly concentrated markets;
• Mergers should not eliminate substantial competition between firms;
• Mergers should not increase the risk of coordination;
• Mergers should not eliminate a potential entrant in a concentrated market;
• Mergers should not substantially lessen competition by creating a firm that controls products or services that its rivals may use to compete;
• Vertical mergers should not create market structures that foreclose competition;
• Mergers should not entrench or extend a dominant position;
• Mergers should not further a trend toward concentration;
• When a merger is part of a series of multiple acquisitions, the FTC and DOJ may examine the whole series;
• When a merger involves a multi-sided platform, the FTC and DOJ will examine competition between platforms, on a platform, or to displace a platform;
• When a merger involves competing buyers, the FTC and DOJ will examine whether it may substantially lessen competition for workers or other sellers;
• When an acquisition involves partial ownership or minority interests, the FTC and DOJ will examine its impact on competition; and
• Mergers should not otherwise substantially lessen competition or create a monopoly.

While important, these questions also are extraordinarily complicated. As evidence of their importance and complexity, the MSCI and USCC letter, available here, noted the FTC and DOJ took nearly 15 months to complete the draft merger guidelines. The letter said, “The length of time it has taken the agencies to produce this draft demonstrates that any urgency to the issue is outweighed by the importance of careful consideration of these complex issues” and concluded, “The agencies are best served if they receive quality feedback.”