FTC, DOJ Suspending Early Terminations Pending Review of Standards

Kelley Drye Client Advisory

The FTC and DOJ announced today that they would be suspending the discretionary” early termination process because of the transition to a new administration” and the unprecedented volume” of HSR filings for the start of a fiscal year.  They are doing this so they can “[review] the processes and procedures used to grant early termination.” They cite to a similar suspension in March 2020 when they implemented the electronic filing program because of COVID. 

We are unaware of the Commission and Antitrust Division ever suspending the early termination process because of a new administration or because they were receiving too many filings.  Typically, if an agency runs out of time to review a filing, it asks the parties to pull and refile” the notification which gives the agency an additional thirty days.  These are rare.  The filings that are granted early termination by the merger screening committee are ones that are clean, there isn’t any negative press and are in industries that are not concentrated.  What these markets and criteria are have been consistent over several administrations.  If they aren’t clean, they are sent to the appropriate merger shops for attorney review.  Except for the front office, staffing from administration to administration is quite stable. 

Senators Klobuchar, Blumenthal, Booker, Markey and Schatz recently introduced an antitrust reform bill to address perceived inadequacies in the antitrust laws.  Some have characterized this legislation as a radical shift.  While it is too early to tell how much the Biden Administration and an all-Democrat legislature will invest in antitrust reform, the speed with which the legislation was introduced as well as the scope and novelty of the suspension suggest that serious antitrust reform as well as enforcement may very well be on the horizon.  The next key indicator as to where antitrust is headed will be whom the President appoints to be the Assistant Attorney General or Chairman.  Will they be traditionalists coming from large corporate practices or less main stream individuals who perhaps have spoken out for serious antitrust reform.  In any event, one may very well see a much more active enforcement agenda even as against the Trump Administration.