House passes three antitrust reform bill and all eyes turn to the Senate

The package included three bills:

• Merger Filing Fee Modernization Act: The Merger Filing Fee Modernization Act (MFFA) aims to increase funding to the Federal Trade Commission and Department of Justice (DOJ) Antitrust Division by increasing filing fees on large M&A transactions.  For example, the bill would impose a $2.25 million fee on transactions larger than $5 billion.  The bill also would decrease fees on smaller transactions.  The Senate passed similar legislation as part of the United States Innovation and Competition Act (USICA), although it was not ultimately included in the slimmed down CHIPS and Science Act passed in July.  However, House Republicans expressed significant opposition to the MFFA, especially in light of alleged politicization of the FTC under the Biden Administration. 
• Foreign Merger Subsidy Disclosure Act:  The bill would require merging companies operating in the United States to disclose information about any financial support or subsidies provided by Foreign Entities of Concern (as defined in the bipartisan infrastructure bill) to the FTC and DOJ Antitrust Division. This bill is another attempt by Congress to identify and curb Chinese influence in the U.S. economy in response to China’s 2025 plan. 
• State Antitrust Enforcement Venue Act: Under current law, antitrust actions brought by state attorneys general can be transferred and consolidated with private antitrust actions through the Judicial Panel on Multidistrict Litigation (JPML).  Antitrust cases brought by federal regulators, however, are exempt from JPML consolidation, meaning they can remain in the original court where the federal regulator filed the action.  The State Antitrust Enforcement Venue Act would permit state attorneys general to keep cases in the jurisdictions they choose, rather than transferring them through the JPML.  Sponsors argue that the legislation will result in more efficient adjudication of state antitrust cases and put state regulators on even ground with federal officials.  The legislation has already passed the Senate by voice vote this year. 

Senate Outlook

When the Senate returns following the midterms, we expect Senator Klobuchar and her bipartisan allies to continue to push for floor consideration of more comprehensive tech antitrust legislation, namely the American Innovation and Choice Online Act (AICOA).  However, momentum for AICOA has slowed, and it has received sharp criticisms from both sides of the aisle, making a path forward very much in doubt.  Shaky support coupled with a short lame duck session and numerous competing priorities makes it unlikely that the Senate will pass AICOA or other more ambitious antitrust reforms this year. 

On the other hand, the House-passed package is generally less controversial and Senator Klobuchar and her allies could turn to it to try to salvage some antitrust victory this congress.  We suspect that the venue bill (which has already passed the Senate) and the foreign merger disclosure bill are relatively non-controversial and could easily be added to another piece of legislation during the lame duck.  The MFFA bill, however, may face more opposition from Republicans skeptical of the direction of the FTC under the Biden Administration.  Whether this opposition would be enough to sink the bill remains unclear, but we do not think the merger bill is enough of a priority for Democrats to insist on its inclusion at the expense of the other antitrust bills. 

We expect to learn more about the lame duck antitrust agenda when the Senate returns in November and will be monitoring it closely. 

Authored by Ches Garrison and Chuck Loughlin.