FTC Discusses Antitrust Laws In Testimony To US Senate

antitrust hearings

The Federal Trade Commission (FTC) revealed details about its recent testimony before the U.S. Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights.

Testifying on behalf of the FTC, Bureau of Competition Director Bruce Hoffman stated, “This hearing focuses on one potential form of conduct that could harm competition in digital technology markets — the acquisition by dominant firms of nascent or potential competitors. This type of behavior, of course, can be just as anticompetitive as any other form of conduct. If a firm buys a nascent rival rather than trying to kill it through other means, that purchase is just as worthy of antitrust scrutiny.”

Hoffman added that the commission has held its own hearings on competition and consumer protection topics over the last year. In addition, the Bureau of Competition recently formed a Technology Task Force to investigate the challenges posed by digital industries, including these types of acquisitions.

The testimony explained how the FTC pays close attention when an industry leader wants to acquire an up-and-coming competitor, using the Clayton Act to analyze the potential merger. Last year, the agency challenged a deal between market leader CDK Global and smaller competitor, Auto/Mate, which both provide specialized platform business software.

In addition to the Clayton Act, the Sherman Act prohibits a firm from gaining or maintaining a monopoly position through anticompetitive conduct. Hoffman explained that the agency used this legal framework in its 2017 case against Questcor, alleging that the company illegally maintained its U.S. monopoly for an expensive drug called Acthar by buying the rights to develop a competing product and then not developing it.

The testimony also detailed the commission’s latest case against the health information technology company Surescripts, which alleges that the firm employed both vertical and horizontal restraints to maintain at least a 95 percent market share in two electronic prescription markets.