US antitrust enforcers target digital platforms in new merger guidelines

WASHINGTON, July 19 (Reuters) – New draft guidelines released by U.S. antitrust regulators on Wednesday laid the groundwork for tighter scrutiny of planned mergers of Big Tech companies such as Amazon.com and Alphabet’s Google.

The Biden administration has taken a tougher stance on the merger, with some aggressive challenges. Had

two court defeats

Just

last week

. Over the next few months, judges will face several challenges, including the Department of Justice’s fight against the so-called

JetBlue’s purchase of Spirit

.

The 51-page guidance from the Department of Justice and the Federal Trade Commission described, without naming, transactions such as Amazon.com’s 2018 purchases of the Ring video intercom system and said antitrust agencies should scrutinize them closely.

“A platform operator who is also a participant in the platform is in a conflict of interest resulting from the incentive to provide its own products and services with an advantage over other competitors participating in the platform, harming competition,” we read in the draft guidelines.

The draft also specifies that the merger should not eliminate a potential participant in a concentrated market or result in a situation in which the company purchases a company supplying raw materials to the acquiring company’s competitors.

The Biden administration’s antitrust enforcement has highlighted labor issues, and the guidance reflects that.

“If a merger of employers is likely to significantly reduce competition for workers, a reduction in competition in the labor market may lower wages or slow their growth, and worsen benefits or working conditions,” the guidelines read.

The guidelines reflect how the FTC and the Department of Justice currently enforce anti-illegal merger laws, which will replace the 2010 Guidelines on Companies Buying Competitors and the 2020 Guidelines on Mergers with Suppliers.

President Joe Biden has insisted that the guidelines be updated in a mid-2021 executive order. They will be open for comment for 60 days before being finalized.

(Reporting by Diane Bartz; Editing by Richard Chang)