California Enacts the COMPETE Act: What the Final Version of AB 1776 Does—and Does Not Do

In this entry to the Antitrust Attorney blog, author Paul Moore offers a quick breakdown of California’s new COMPETE Act, signed by Governor Gavin Newsom on September 30, 2026. Effective January 1, 2027, the law expands the Cartwright Act to prohibit single-firm monopolization and monopsonization, including attempts to monopolize and conspiracies to do so.

The final legislation is narrower than earlier proposals. It drops a standalone ban on unilateral conduct that unreasonably restrains trade, eliminates a private right of action, and requires the government to establish “substantial market power” rather than simply market power. Enforcement will be limited to the California Attorney General and district attorneys.

The Act gives California enforcers a new tool against unilateral conduct while expressly allowing courts to develop California antitrust law independently of federal precedent. It requires liberal construction of the law, recognizes competition for workers as protected competition, and confirms that businesses may lawfully acquire or maintain monopoly power through superior products, services, or business skill. Certain qualifying small businesses and government-supervised conduct are exempt.

Although the new provisions address much of the conduct covered by Section 2 of the Sherman Act, federal antitrust decisions will be only instructive rather than controlling. The Act’s practical impact will therefore depend heavily on how California courts interpret “substantial market power” and develop the state’s distinct approach to monopolization and monopsonization…

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