Consideration of Public Interest Factors in Antitrust Merger Control

CPI ICN Column edited by Maria Coppola (U.S. Federal Trade Commission)

Public Companies and Competition Law: The Launching of an ICN Project – Dave Poddar & Gemma Stooke¹ (Clifford Chance LLP)

Introduction

At a time when the International Competition Network’s (“ICN”) widely acclaimed Recommended Practices for Mergers are approaching their 10 year anniversary, it is worthwhile reflecting on an increased focus by some jurisdictions on public interest factors in merger reviews.  The question of whether and to what extent public interest policy considerations play a legitimate role in merger review is a vexed one.  As a general proposition, the merger review process should involve certainty, timeliness, and transparency in merger review processes for all stakeholders.  Can the consideration of public interest be consistent with such a merger review process?

Merger Control Processes

Mergers are not inherently bad for the economy or consumers.  Mergers often facilitate the efficient use of scarce resources, thus maximising welfare.  From an economic perspective merger control is focused on mergers that are likely to harm competition by creating or enhancing the merged firm’s ability or incentives to exercise market power – either unilaterally or through coordination with rivals – resulting in price increases above competitive levels for a significant period of time, reductions in quality, or a slowing