Behavioral Remedies in U.S. Merger Settlements: Past, Present and Future

While in the past, the FTC and DOJ have been receptive to considering behavioral remedies to resolve discrete competition concerns arising from the vertical components of a merger, policy pronouncements by senior officials at the FTC and DOJ under the current administration have led many to conclude that behavioral remedies are off the table when it comes to negotiating merger remedies with the agencies. An examination of recent merger settlements indicates that the DOJ has, in fact, substantially limited the use of the behavioral remedies, whereas the FTC remains receptive to considering behavioral relief to resolve discrete vertical competition concerns while preserving the benefits of vertical integration. Although it is unclear if the agencies’ divergent track records indicate an actual conflict in their approaches to vertical remedies, practitioners should be aware that the fate of a vertical merger that presents discrete competitive issues, and the relief available to resolve such issues, may depend on which agency reviews it.

By Julie North, Jesse Weiss¹

I. INTRODUCTION

Although structural remedies have long been the U.S. antitrust agencies’ preferred means of resolving competitive concerns raised by mergers, behavioral remedies, such as information firewalls and non-discrimination requirements, historically have been used to address competitive concerns arising from vertical mergers (i.e. mergers of businesses ope