By Daniel Francis, NYU School of Law.
What should we do with a magic wand? The revision of the merger guidelines offers an opportunity to update and improve the foundational texts of U.S. merger control, as well as dangers.
The guidelines’ status as a critical enforcement asset is a function of judicial confidence that the guidelines reflect the teachings of experience and a consensus that will endure across Administrations. Moreover, it is not at all clear that the text of the 2010 guidelines is really holding back federal merger enforcement: other frontiers — including agency resources, judicial skepticism, and the HSR timeline — all seem to be much more significant constraints on the agencies. Accordingly, too free a hand in revising the guidelines risks undermining a key asset of the merger-control system, without offering much prospect of an offsetting benefit. The deep puzzles and gaps in merger law, including causation and the treatment of efficiencies and upfront remedies, likely cannot be solved by guidelines.
But there are a number of ways in which the guidelines could usefully be filled out or adjusted. Among other things, brief discussions of future (including potential and nascent) competition, platform markets, data, and the relationship between merger review and conduct would help the public, courts, policy-makers, and merging parties understand how the agency thinks about some high-profile puzzles that have been the subject of extensive enforcement experience. By adding some explanation of these topics, while relying on litigation and legislation to develop the substance of merger law, the agencies can ensure the guidelines remain a reliable, trusted, and up-to-date guide to the execution of one of their most important functions.
