Just one agency should enforce antitrust law

June 17, 2019

Anonymous individuals at the Department of Justice’s Antitrust Division and the Federal Trade Commission have recently taken it upon themselves to leak to the media that their respective agencies will soon open investigations of the largest U.S. tech companies. Policing markets with the antitrust laws is key to ensuring that competition benefits consumers.

No industry should be free from antitrust scrutiny, including Big Tech. But, splitting of this tech antitrust review across two federal agencies, despite the many similar competition issues that will be investigated, illustrates both the absurdity of having two federal agencies handling civil antitrust enforcement. It also shows why these investigations are likely to be less effective and coherent than they should be.

According to reports, the FTC will investigate certain conduct by Facebook and Amazon, while the Antitrust Division will look into whether Google and Apple have acted anti-competitively. These investigations will clearly cover much of the same ground. For example, Facebook and Google are both alleged to have used their market power to monopolize digital advertising. Splitting antitrust investigations of these firms between two agencies is just analytically inefficient.

Dividing review of the tech industry also invites conflicts between the agencies on how they analyze competition issues. We already are seeing this kind of dysfunction in how the agencies handle matters relating to intellectual property licensing. With their divvying up the various tech companies between themselves, we’re likely to see further divergence in enforcement.

Having two agencies police the same beat also invites bureaucratic pettiness as civil servants place their own agency’s interests over those of American consumers and taxpayers. This is perhaps best evidenced by the arcane and ad hoc clearance process used to determine which agency will lead which investigation. In some cases, the Department of Justice and FTC decide which agency will handle a case by a coin flip. Seriously.

The problem here is having two federal agencies responsible for civil antitrust enforcement. This creates a duplication of resources that could be better used on actual antitrust enforcement. Moreover, given the different policies and procedures each agency follows, some industries are subject to a different standard of review just due to an accident of history that determined which agency would have jurisdiction. This is particularly evident in merger review, where the FTC has the ability to litigate a challenged merger before its in-house administrative court, and then potentially overturn an adverse decision on an appeal that is decided by the very commissioners who voted out the original complaint.

In contrast, the DOJ has to litigate its merger challenges in federal court. The SMARTER Act, introduced during the last Congress, sought to remedy this issue, but that really just addresses a symptom and not the cause of the underlying problem.

Enforcement of the antitrust laws is critical to safeguarding competitive markets that benefit consumers. Congress should focus on ensuring that antitrust enforcement efforts are backed by appropriate resources. One way to further that goal would be to reorganize civil antitrust enforcement so that it is done under one roof. Doing so would result in more coherent, efficient, and effective antitrust enforcement.

Op-ed originally published by the Washington Examiner