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FTC broadens antitrust enforcement powers

The Federal Trade Commission took steps Thursday to broaden its powers by increasing the scope of antitrust inquiry, streamlining rulemaking and expediting investigations.

The Federal Trade Commission passed resolutions broadening its antitrust enforcement powers Thursday.

The FTC voted to rescind a 2015 "Statement of Enforcement Principles" that limited the FTC's antitrust inquiries to violations of existing antitrust law, the Sherman and Clayton acts. The FTC can now, without that restriction, pursue antitrust lawsuits that fall outside the boundaries of the existing antitrust laws. The FTC also voted to streamline consumer protection rulemaking and its antitrust investigations.

"The reforms are designed to ensure that our staff can comprehensively investigate unlawful business practices across the economy," said Lina Khan, the FTC's new chairman, in a news release. Kahn has been critical of tech giants growing exponentially in power. "They will help relieve unnecessary burdens on staff and cut back delays and 'red tape' bureaucracy when it comes to advancing our commission's law enforcement priorities. This is particularly important, given that we are in the midst of a massive merger boom."

The FTC's broadening of its enforcement powers comes just one day after Amazon filed a petition seeking to recuse Khan from investigating the company. The FTC is currently investigating Amazon's past acquisitions.

In its petition, Amazon claimed that Khan's public statements about the company prior to being sworn in as FTC chair means she has prejudged facts related to the company's business practices. Khan is known for her 2017 report "Amazon's Antitrust Paradox," in The Yale Law Journal, in which she stated: "Elements of the firm's structure and conduct pose anticompetitive concerns -- yet it has escaped antitrust scrutiny."

The FTC's Thursday vote follows reports that it plans to investigate Amazon's acquisition of MGM for $8.5 billion. In a letter to Khan this week, Sen. Elizabeth Warren, D-Mass., urged that the FTC's review be "broad and meticulous" and should consider implications beyond streaming and entertainment services.

I want to caution policymakers not to harm innovation in their attempt to punish big tech.
Christine WilsonCommissioner, FTC

"[B]ecause this service is tied to a wide range of additional Amazon products and services that affect broad sectors of our economy, this transaction requires meticulous antitrust scrutiny," Warren wrote.

The new FTC resolutions are the latest ramping up of antitrust efforts aimed at big tech, which include the advancement of six antitrust reform bills -- something FTC Commissioner Christine Wilson expressed concern about during a webinar Thursday hosted by the Hudson Institute, a think tank and research center in Washington, D.C.

"I want to caution policymakers not to harm innovation in their attempt to punish big tech," she said. "There's a lot of discontent with big tech -- I think there are at least three strains of concerns. The first is Section 230 issues; second is privacy; and the third falls within the antitrust bucket. I would caution against using antitrust as a solution for all of those concerns, and in the end essentially punishing innovation."

Also this week

  • Spain's National Commission of Markets and Competition has initiated an investigation into Apple and Amazon for potential anticompetitive behavior related to the online sale of electronic products. The antitrust authority is considering disciplinary measures that include restricting the Amazon website in Spain.
  • A federal judge dismissed two antitrust lawsuits against Facebook that alleged the company engaged in anticompetitive behavior when it purchased Instagram in 2012 and WhatsApp in 2014. The court filing said the lawsuits filed by the FTC and state attorneys general failed to provide enough evidence proving Facebook had engaged in anticompetitive behavior. The FTC can amend and refile its case, while the state attorneys' general lawsuit was dismissed.
  • S. Senators Amy Klobuchar, D-Minn., and Mike Lee, R-Utah, as well as U.S. House of Representatives members David Cicilline, D-R.I., and Ken Buck, R-Colo., sent a letter to Khan Thursday urging the FTC to continue its investigation into Facebook and hold the company accountable for potential antitrust law violations.

Elsewhere

  • Google has put a deal to pay for news content from French publishers on hold as it awaits an antitrust ruling by French authorities, Reuters is reporting. Google agreed to pay $76 million to 121 publications in January, according to Reuters. Google also recently settled with French authorities over a case regarding its ad practices, agreeing to pay a $268 million fine and change the way it allows competing advertising services to access consumer data.

Makenzie Holland is a news writer covering big tech and federal regulation. Prior to joining TechTarget, she was a general reporter for the Wilmington StarNews and a crime and education reporter at the Wabash Plain Dealer.

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