United States: merger review process
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This article discusses the competition-related merger review process in the United States. It describes the institutions involved in merger review – primarily, the Antitrust Division of the US Department of Justice (DOJ) and the Federal Trade Commission (FTC). It outlines the legal framework these entities apply when investigating mergers, traces the life cycle of a typical merger review and discusses recent notable merger review enforcement under the Biden administration.
- The institutions involved in merger review: DOJ, FTC and state attorney generals
- Substantive law: Clayton Act Section 7 and the merger guidelines
- In-depth merger reviews
- Merger enforcement under the Biden administration
Referenced in this article
- Clayton Act Section 7
- Hart-Scott-Rodino Antitrust Improvements Act
- Horizontal Merger Guidelines
- Vertical Merger Guidelines
The statutory framework for suspensory merger review in the United States comes from the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the HSR Act). Under the HSR Act, parties engaging in transactions that exceed certain inflation-adjusted monetary thresholds are required to notify both the Department of Justice (DOJ) and the Federal Trade Commission (FTC) (collectively, the agencies) at least 30 days prior to closing and pay a fee based on the size of the transaction. Failure to file can result in penalties in excess of US$45,000 per day. At the end of the 30 days, known as the ‘waiting period’, the parties are free to close unless: (i) the parties ‘pull and refile’ to provide the agencies a fresh 30 days to review the transaction; or (ii) either of the agencies ‘require[s] the submission of additional information or documentary material relevant to the proposed acquisition’ (commonly called a second request). If a second request is issued, the parties cannot close until 30 days after substantially complying. The time it takes to comply with a second request depends on a number of factors, but it is typical for parties to take between two and a half and nine months to comply with a second request.
At the end of the merger review process, there are three basic outcomes:
- the reviewing agency can close its investigation;
- the reviewing agency and the merging parties can settle to resolve any competitive concerns posed by the transaction, such as by divesting certain facilities; or
- the reviewing agency can sue to block the transaction.
Because the HSR filing requirement is based on the size of a transaction, rather than on a transaction’s competitive significance, it inadvertently sweeps in many transactions that pose no competitive concerns. Prior to January 2021, the agencies would often grant, upon request, ‘early termination’ for competitively insignificant transactions, allowing the parties to close prior to the expiry of the 30-day waiting period. Shortly after President Biden’s inauguration, however, the agencies ‘paused’ early termination and, at the time of writing, show no sign of resuming.
Structure and organisation
Two agencies share jurisdiction over merger review: the DOJ and the FTC. The DOJ is part of the executive branch of the federal government, and its leader, the Attorney General (AG), is a member of the President’s cabinet. The Antitrust Division of the DOJ is led by a presidentially appointed, Senate-confirmed assistant AG (AAG). The AAG has unilateral decision-making authority over the Antitrust Division, but reports to the AG. The AAG is assisted by several politically appointed deputy AAGs, two or three of whom generally oversee civil matters, including merger review, merger litigation and international relations. At the career-staff level, the Antitrust Division of the DOJ has six civil litigating sections that conduct merger review investigations for specific commodities:
- healthcare and consumer products;
- defence, industrials and aerospace;
- financial services, fintech and banking;
- media, entertainment and communications;
- transportation, energy and agriculture; and
- technology and digital platforms.
Each section is headed by a chief and two assistant chiefs, and staffed, at least historically, by approximately 20 to 25 trial attorneys and 12 paralegals. DOJ leadership has significant flexibility in staffing matters, and, if a particular section is busy, it is not uncommon for merger investigations to be assigned to a different section. Personnel are also frequently detailed to different sections if there is a particular need. On 16 November 2021, Jonathan Kanter was confirmed by the US Senate to serve as AAG of the Antitrust Division of the DOJ.
The FTC is a federal administrative agency headed by five commissioners, collectively known as the Commission. Each commissioner is nominated by the president and confirmed by the Senate. No more than three commissioners may be members of the same political party. The president designates one commissioner as Chair of the Commission, who sets the agency’s agenda, appoints key staff and oversees the day-to-day work of the FTC, with certain key actions subject to vote by the whole Commission. The FTC is organised into three divisions known as bureaus: the Bureau of Competition, the Bureau of Consumer Protection and the Bureau of Economics. The bureaus primarily responsible for reviewing mergers are the Bureau of Competition and the Bureau of Economics. The Bureau of Economics works with the Bureau of Competition to evaluate mergers and provides independent, economic analysis of deals for review and consideration by both the Bureau of Competition and the Commission. Within the Bureau of Competition are four merger-specific sub-divisions, colloquially known as ‘shops’, which typically review transactions according to the following criteria:
- Mergers I: reviews transactions in healthcare-related industries, including branded and generic pharmaceutical manufacturing and distribution, medical devices and consumer health products. It also handles matters involving defence, scientific, industrial, technology and consumer products;
- Mergers II: reviews transactions in a wide variety of industries, including coal mines, chemicals, entertainment and computer hardware and software;
- Mergers III: reviews transactions in a diverse set of industries from razors and online real estate listing services to title insurance, rooftop aerial measurement products, oil and gas, and retail fuel stations, terminals and pipelines; and
- Mergers IV: reviews transactions involving hospitals, physicians, office supply distribution, food distribution, supermarkets, specialist retail stores, consumer goods and casinos.
Each merger section is headed by an assistant director and two deputy assistant directors, and staffed, at least historically, by approximately 30 attorneys.
President Biden inherited four commissioners: Democrats Rebecca Slaughter and Rohit Chopra and Republicans Noah Phillips and Christine Wilson. Shortly after inauguration, President Biden made Commissioner Slaughter acting chair. In March 2021, he nominated Lina Khan as the fifth commissioner, but was silent on selecting a permanent chair. On 15 June 2021, within hours of Khan’s confirmation as a commissioner, President Biden named her as chair of the FTC. Chair Khan came to prominence as a critic of the bipartisan antitrust consensus of the past 40 years, and her aggressive enforcement efforts thus far as chair are consistent with what industry insiders expected of her tenure. In October 2021, Commissioner Chopra departed the FTC to join the Consumer Financial Protection Bureau. Commissioner Chopa’s departure led to an eight-month gridlock at the Commission until Alvaro Bedoya was confirmed in May 2022, thereby reinstating a Democratic majority among the commissioners.
Although the DOJ and FTC share jurisdiction, the agencies do not concurrently investigate mergers. Rather, they divide matters between themselves on the basis of expertise as part of the ‘clearance process’. As a practical matter, when they are notified about a potential merger, each agency conducts an initial evaluation to determine if the transaction warrants further review and falls within the agency’s subject matter expertise. If those conditions are satisfied, the agency will seek clearance from the other agency to open an investigation. Occasionally, however, a transaction will fall into an area where each agency claims expertise or that cuts across both agencies’ expertise (eg, a vertical merger where one agency has expertise in the upstream market and the other has expertise in the downstream market), which may delay the launch of the investigation. When this happens, it can put merging parties in a difficult situation because the reviewing agency may lack the time necessary to assess the transaction within the 30-day waiting period. To avoid a scenario in which the investigating agency defaults to issuing a second request, it is not uncommon for the merging parties to pull and refile their HSR filing, thereby granting the investigating agency an additional 30-day waiting period to evaluate the potential competitive impact posed by the transaction. As of 25 October 2021, the FTC has imposed an additional hurdle to clearance – companies that enter into consent decrees with the FTC will be required to obtain prior approval by the FTC, for a period of up to 10 years, for any transaction in the same product or geographic market as the consent decree (prior approval). Under certain circumstances, the FTC may even require prior approval for transactions that extend beyond the relevant markets covered under the consent decree. In practical terms, the FTC’s prior approval policy will require otherwise unreportable transactions to be reported to the FTC by companies subject to an FTC consent decree. Note, however, that the DOJ has not announced parallel obligations.
In addition to the DOJ and FTC, many large transactions must be reported to foreign competition agencies. The DOJ and FTC often coordinate with foreign competition agencies in the form of periodic calls to share updates on process and timing, as well as to discuss facts and theories of harm. Because of statutory confidentiality requirements, merging parties must waive confidentiality for the agencies to discuss confidential information with foreign enforcers.
State attorneys general
AGs from individual US states (state AGs) are increasingly interested in, and active on, antitrust matters, including merger reviews. Although most US states have state-specific antitrust laws, state AGs also have parens patriae standing to bring suit under federal antitrust law, allowing them to act as quasi-sovereign enforcers in parallel with the agencies. Although no US state has a general mandatory pre-merger notification requirement, public reports of transactions can attract state AG attention. When there is state AG interest in a merger investigation, the agencies typically cooperate with the relevant state AGs, sharing procedural and substantive updates and even conducting joint meetings, with the relevant federal agency taking the lead. There is, however, the potential for divergence between the agencies and state AGs, and state AGs have challenged mergers cleared by the agencies and have obtained remedies in addition to those sought by the agencies.
Substantive legal framework
Section 7 of the Clayton Act provides the legal framework for substantive merger review. Like Sherman Act Sections 1 and 2, the statutory text gives minimal guidance, providing that mergers are prohibited where the effect ‘may be substantially to lessen competition, or to tend to create a monopoly’. Synthesising judicial precedent and economic analysis, the agencies have promulgated merger guidelines that reflect how they evaluate mergers, including long-standing Horizontal Merger Guidelines (HMG) and more recently issued Vertical Merger Guidelines (VMG). Historically, these guidelines, particularly the HMG, have been highly influential in how courts apply the federal antitrust laws. As described below, however, they are falling out of favour under the current leadership of both agencies. Nevertheless, they still serve as a useful benchmark in assessing transactional risk and the theories of harm that the agencies may explore when investigating a transaction.
The 2010 HMG concisely lay out the agencies’ approach to evaluating horizontal mergers, namely mergers between firms that compete directly. The HMG start by addressing evidence of anticompetitive effects. The agencies consider various types of evidence, ranging from actual effects observed in consummated mergers to direct comparisons based on experience, to market shares and concentration, to substantial head-to-head competition and even to the ‘maverick’ status of one of the merging parties. The primary sources of evidence are documents and information from the merging parties, customers and other industry participants and observers.
The HMG also cover market definition, including various legal and economic tests the agencies typically use to define the relevant product and geographic markets. The HMG explain how the agencies consider market participants, shares and concentration. Potential entrants can be considered part of the market. Shares are calculated based on the best available information, such as capacity or revenue. The agencies use the Herfindahl-Hirschman Index to measure concentration and consider mergers that result in certain levels of concentration to be presumptively anticompetitive.
The HMG discuss two broad theories of harm – unilateral effects and coordinated effects. Unilateral effects stem from the elimination of competition between the merging firms independent of any other market participants. These ‘are most apparent in a merger to monopoly in a relevant market, but are by no means limited to that case’. Coordinated effects occur when a merger ‘diminish[es] competition by enabling or encouraging post-merger coordinated interaction among firms in the relevant market that harms customers’.
The HMG also discuss various defences. Powerful buyers may constrain the ability of merging parties to raise prices, potentially reducing harm. If entry by a new competitor into the relevant market post-merger would be timely, likely and sufficient to counteract potential harmful effects, then the merger may be lawful. The HMG recognise that ‘a primary benefit of mergers to the economy is their potential to generate significant efficiencies and thus enhance the merged firm’s ability and incentive to compete’, resulting in pro-competitive effects. The agencies will credit verified and quantified merger-specific efficiencies. Finally, the agencies consider the possibility of a failing firm where, in the absence of the merger, the assets would exit the market, rendering an otherwise anticompetitive merger lawful.
Vertical mergers are combinations between firms operating at different levels in related markets (eg, manufacturer–distributor). Although, as a class, vertical mergers tend to raise fewer competitive concerns than horizontal mergers, they can harm competition under certain circumstances, and the agencies have challenged vertical mergers consistently, if not frequently, over the past 25 years.
The VMG were adopted by the agencies in 2020. Prior to that, the DOJ (but not the FTC) issued Non-Horizontal Merger Guidelines in 1984, which were widely considered a dead letter. The 2020 VMG were the first systematic joint statement by the agencies explaining their analytical approach to evaluating vertical mergers. The VMG are substantially shorter than the HMG (14 pages versus 37), and explicitly state that they ‘should be read in conjunction with the [HMG]’ and that ‘[m]any of the principles and analytic frameworks used to assess horizontal mergers apply to vertical mergers’. The VMG address questions that arise specifically in the context of vertical mergers. For instance, the VMG state that the agencies, in addition to defining a relevant product market, will also specify a ‘related product’, which could be ‘an input, a means of distribution, access to a set of customers, or a complement’ to the relevant product market.
Like the HMG, the VMG discuss both unilateral and coordinated effects. The VMG identify two specific categories of unilateral effects.
The first is ‘foreclosure and raising rivals’ costs’, of which the VMG provide six illustrative examples, including:
- straightforward input foreclosure (the merged firm restricting rivals’ access to a critical input);
- input foreclosure through increased bargaining leverage (a version of this theory was the DOJ’s principal theory of harm in its unsuccessful challenge of AT&T’s acquisition of Time Warner Inc);
- creating the need for two-level entry (post-merger, a new entrant is unlikely to enter successfully, unless it can enter at both levels); and
- raising rivals’ cost of distribution (limiting access to an important distribution channel).
The second unilateral effect is giving the merged firm access to competitively sensitive information. For example, if a downstream rival to the merged firm were a pre-merger customer of the upstream firm, the merger could give the merged firm access to its rival’s sensitive business information, which could harm competition.
The VMG’s discussion of coordinated effects is sparse. It incorporates the HMG’s discussion of coordinated effects by reference and then gives an example of the merged firm’s access to competitively sensitive information better enabling it to coordinate. Underscoring the fact-intensive nature of the analysis, the VMG add that ‘[s]ome effects of a vertical merger may make the market less vulnerable to coordination’.
Finally, the VMG acknowledge the potential pro-competitive effects flowing from vertical mergers. Most significantly, vertical mergers can eliminate double marginalisation, resulting ‘in the merged firm’s incurring lower costs for the upstream input than the downstream firm would have paid absent the merger’, which arises directly from the merger itself. The VMG state that it is ‘incumbent upon the merging firms to provide substantiation for claims that they will benefit from the elimination of double marginalization’, but add that the agencies will attempt to assess these benefits on their own.
While the guidelines (especially the HMG) reflect substantial consensus within both the antitrust bar and federal judiciary regarding how to analyse mergers under Clayton Act Section 7, they have come under criticism from both the left and the right. Lina Khan’s elevation to the chair of the FTC has taken the agency into novel territory, including by investigating merger consequences beyond the scope of the HMG and VMG, such as how transactions impact labour markets. Already, President Biden has issued an executive order directing the agencies to re-evaluate their merger guidelines, and the FTC and DOJ issued a joint statement announcing ‘a hard look to determine whether [the guidelines] are overly permissive’ and promising to ‘launch a review of our merger guidelines with the goal of updating them’. On 15 September 2021, the FTC withdrew from the VMG on a party-line vote. In a joint statement accompanying the move, Chair Khan and commissioners Chopra and Slaughter noted several of the VMG’s deficiencies. Citing evidence from hospital mergers and physician groups, for example, the statement argues, ‘[W]e should be highly sceptical that [elimination of double marginalisation] will even be realized – let alone passed on to end-users’. For now, the VMG remain in effect for the DOJ, although in January 2022 the DOJ and FTC announced an intention to develop new merger guidelines. Accompanying the announcement were prepared remarks from DOJ AAG Kanter:
The Antitrust Division shares the FTC’s substantive concerns regarding vertical merger guidelines. Those guidelines overstate the potential efficiencies of vertical mergers and fail to identify important relevant theories of harm. Market participants and courts should understand the Vertical Merger Guidelines only in the context of the broad-based review and overhaul, which we are launching today.
Signalling potentially transformational revisions to the HMG and VMG, the FTC is seeking, at the time of writing, public comment on the following areas:
- the purpose and scope of merger review;
- presumptions that certain transactions are anticompetitive;
- use of market definition in analysing competitive effects;
- threats to potential and nascent competition;
- impact of monopsony power, including labour markets; and
- unique characteristics of digital markets.
Additionally, there is pending legislation that, if adopted, could change the substantive legal standard.
In-depth merger reviews
This section describes the flow of a typical in-depth merger review. First, however, some context is necessary. US merger review functions like a funnel. The HSR Act filing requirement is the wide mouth, capturing a large number of transactions, the majority of which raise no competitive issues and face no scrutiny beyond a review of the filing itself. As the funnel narrows, a small number, about one in 10, trigger a preliminary investigation, in which the agencies engage in the clearance process. Narrower still on the funnel, a subset of those preliminary investigations draw a second request and a lengthy, drawn-out investigation. At the very end of the funnel, a handful each year result in some action by the reviewing agency – either a settlement or a challenge.
Statistics published by the agencies illustrate this point. In 2020, the most recent year for which statistics are available, there were a little more than 1,600 HSR filings, a greater than 20 per cent decrease from the prior year. Nearly three-quarters requested early termination, and the agencies granted early termination for slightly more than half of all filings. Less than 11 per cent of HSR filings resulted in a preliminary investigation. Only 3 per cent resulted in a second request.
For transactions that result in a second request, the merger review process can be lengthy and expensive. Not infrequently, merging parties subject to a preliminary investigation may pull and refile their HSR filings to reset the 30-day clock and provide themselves additional time to persuade the reviewing agency that a second request is unnecessary or can be narrowly drawn.
Second requests, once issued, require the merging firms to produce massive amounts of information and data and make available business people for depositions. While any given second request is tailored to each specific transaction, the agencies have posted models on their websites.
One option for parties subject to a second request is to comply and certify substantial compliance, triggering a 30-day window for the reviewing agency to decide whether to sue. However, this risks alienating the decision maker and incentivising the reviewing agency to prepare for litigation rather than assessing potential resolutions short of litigation. This can be a particularly undesirable situation, especially if the delay caused by litigation with an agency allows one of the parties to terminate the merger agreement.
Another option is for parties subject to a second request to engage with the reviewing agency by entering into a timing agreement, committing to rolling productions of documents and data and giving the agency additional time in exchange for certain process guarantees, including substantive engagement with staff and audiences with decision makers. The DOJ and FTC have each published model timing agreements.
While every investigation is different, most follow the same general pattern. There is an initial back and forth between the parties and the investigating staff on facts and theories. If concerns are not resolved in the course of the investigation, the staff will give the merging parties feedback on the staff’s concerns, which the staff have likely embodied in a recommendation memorandum to the reviewing agency’s decision makers. The staff’s recommendation memoranda are frequently lengthy documents, almost like summary judgment briefs, outlining relevant facts and theories of harm, addressing both strengths and weaknesses. Near the end of the review period, the parties will meet with decision makers and make their case that the merger should not be challenged.
If the concerns expressed by the agency can be remedied (eg, overlaps in distinct geographic or product markets), the parties may short-circuit this process by offering divestitures and shifting to settlement negotiations. This often happens entirely at the staff level (although the decision makers must, of course, approve any settlement), but is occasionally prompted by concerns underlined by the decision makers.
If the concerns remain and cannot be remedied, the reviewing agency may take action to block the deal from closing. Faced with this prospect, merging parties frequently abandon their transactions, but occasionally litigate and sometimes prevail in court.
Merger enforcement under the Biden administration
Nearly halfway through his term, President Biden’s antitrust merger enforcement policy is proving to be a difficult environment for mergers, and even for vertical mergers, which have historically not been a big focus for the agencies. President Biden himself has criticised the antitrust consensus over the past 40 years as being too lenient, and his appointments to key roles portend more aggressive enforcement to come, including actions related to merger review. Shortly after she was confirmed to the FTC and then immediately elevated to chair, Chair Khan held an open meeting and pushed through seven resolutions that identified enforcement priorities and authorised compulsory processes for investigations into those areas. One resolution specifically identified merger investigations as a priority area. While many of the other resolutions go beyond merger enforcement, they suggest that the FTC will be particularly focused on mergers involving technology platforms, healthcare and pharmaceuticals.
Already, the agencies have been more willing to impose higher regulatory costs (for example, ‘pausing’ early termination) and have been less sympathetic to complaints about process and burden concerns. The FTC’s recent practice of issuing warning letters to parties when the agency cannot conclude its investigation within the timing constraints of the HSR Act has increased regulatory uncertainty for merging parties. These letters notify parties that they may consummate their mergers at their own risk if they do so prior to receiving formal notice of clearance from the agency.
Relatedly, merger enforcement is likely to be less predictable, with the agencies exploring and even pursuing novel theories, including investigations focused primarily on labour markets. Past merger resolutions may not serve as useful predictors of future resolutions. Several recent FTC dispositions illustrate this point.
One of the highest profile challenges during the Biden administration involves Lockheed Martin’s attempted acquisition of Aerojet, ‘the last independent U.S. supplier of missile propulsion systems’. In January 2022, the Commission voted 4-0 to send the vertical deal to the scrapyard, with Bureau of Competition Director Holly Vedova noting, ‘If consummated, this deal would give Lockheed the ability to cut off other defense contractors from the critical components they need to build competing missiles.’ The FTC is reported to have worked collaboratively with the Department of Defense (DOD), which ‘facilitated a series of FTC-led interviews with DOD-impacted stakeholders’. On 13 February 2022, the parties announced their decision to terminate the proposed merger. Two days later, the DOD publicly released a report cautioning against increasing consolidation within the defence industry and identified ‘strengthening merger oversight’ as a way to spur competition in the industry. As a signal to industry participants, the report further notes, ‘[W]hen a merger threatens DoD interests, DoD will support the Federal Trade Commission (FTC) and Department of Justice (DOJ) in antitrust investigations and recommendations involving the defense industrial base.’
Another high-profile vertical merger challenge involves Nvidia’s attempted acquisition of Arm, which creates and licenses microprocessor designs and architecture for semiconductor chip suppliers such as Nvidia. Following a coordinated investigation with competition authorities in the European Union, United Kingdom, Japan and South Korea, the FTC voted 4-0 to short-circuit the deal in December 2021. The FTC’s complaint alleges numerous anticompetitive effects as a result of the transaction. In recognition that the transaction was likely to receive heightened regulatory scrutiny, Nvidia agreed to pay a US$1.25 billion termination fee in the event antitrust approvals could not be obtained. Although the parties geared up for trial, the transaction was ultimately abandoned in February 2022. Valued at US$40 billion, the transaction would have been the largest acquisition in the semiconductor industry and is one of the largest mergers to be abandoned thus far during the Biden administration.
Further illustrating the trend of strong vertical merger enforcement is UnitedHealth Group’s attempted acquisition of Change Healthcare, ‘the leading source of key technologies that United’s health insurance rivals rely on to compete with United’. In conjunction with the AGs of Minnesota and New York, the DOJ sued to block the transaction in February 2022. According to Principal Deputy AAG Doha Mekki of the DOJ, ‘The proposed transaction threatens an inflection point in the health care industry by giving United control of a critical data highway through which about half of all Americans’ health insurance claims pass each year.’ Also motivating the DOJ’s challenge was a concern that the ‘proposed transaction also would eliminate United’s only major rival for . . . a critical product used to efficiently process health insurance claims and save health insurers billions of dollars each year’, thereby providing ‘United a monopoly share in the market’. At the time of writing, the matter is still ongoing.
Lifespan/Care New England Health System
Similar to the UnitedHealth challenge, the FTC teamed up with the AG of Rhode Island to challenge a merger between Lifespan Corp and Care New England Health System, ‘Rhode Island’s two largest healthcare providers’. In February 2022, the FTC voted 4-0 to issue a complaint and authorised staff to seek a temporary restraining order and preliminary injunction. According to the complaint, ‘If this merger is allowed to proceed, Respondents would control at least 70 percent of the markets for inpatient [general acute care] hospital services and inpatient behavioural health services’ in Rhode Island, in addition to concentrated shares for other healthcare services. Despite the Commission’s unanimous agreement to file the complaint, the commissioners differed, along party lines, on whether to include allegations of harm in a relevant labour market.
A joint statement from the Republican commissioners reads, in part:
Including the additional [relevant labor market] count would also add complexity to the litigation and demand further resources to try the case, without changing the relief the Commission will obtain from a successful challenge to the current product market case or improving the Commission’s odds of success.
The parties terminated their merger shortly after the complaint was issued, seemingly validating the Republican commissioners’ thinking. Nevertheless, it can be expected that Chair Khan will continue to encourage staff to investigate how transactions impact labour markets.
Consistent with the Biden administration’s broader policy goal of reducing the prevalence of non-compete agreements in the US economy, the FTC zeroed in on a relatively small, unreported transaction involving regional petrol and diesel fuel retailers. In March 2021, ARKO and GPM Investments entered into an agreement to acquire 60 Express Stop retailers from Corrigan Oil Company. Director of the Bureau of Competition Holly Vedova summarised the FTC’s competitive concerns:
As part of their $94 million acquisition of Corrigan assets, ARKO and GPM insisted on a sweeping agreement to not compete covering more than 190 GPM locations in Michigan and Ohio, many of which are completely unrelated to the transaction.
In June 2022, the FTC voted 5-0 to issue a complaint and accept a proposed order. Under the proposed order, ARKO and GPM agreed to a number of competitive concessions, including limitations on the duration and geographic scope of the non-compete as well divestment of five fuel retailers back to Corrigan. Accompanying the order is a joint statement by Chair Khan and commissioners Slaughter and Bedoya that reads, ‘Firms proposing mergers should take note that the Commission will scrutinize contract terms in merger agreements that impede fair competition’. The agency’s enforcement in this matter may also serve as a reminder to the broader business community that antitrust law applies to US-nexus transactions of all sizes, and even to deals that do not need to be reported to the agencies.
 See 15 USC § 18a.
 Current thresholds start at US$101 million (US$45,000 fee), with fees increasing at US$202 million (US$125,000 fee) and US$1.0098 billion (US$280,000 fee). Thresholds for 2022 can be found on the Federal Trade Commission (FTC) website. HSR threshold adjustments and reportability for 2022 (11 February 2022).
 This article refers to the Commission, as distinguished from the FTC, when specifically discussing the five presidentially appointed commissioners acting in their decision-making capacity.
 See footnote 2. A bipartisan bill that would change the Hart-Scott-Rodino Antitrust Improvements Act’s (the HSR Act) filing fees, ranging from US$30,000 to US$2.25 million, was introduced in 2021 but has stalled in the Senate. Morrison & Foerster, ‘Senate Passes Bill to Increase HSR Filing Fees for Large Transactions’ (21 June 2021), https://www.mofo.com/resources/insights/210621-senate-passes-bill.html.
 Press Release, FTC, ‘FTC Publishes Inflation-Adjusted Civil Penalty Amounts for 2022’ (6 January 2022), https://www.ftc.gov/news-events/news/press-releases/2022/01/ftc-publishes-inflation-adjusted-civil-penalty-amounts-2022.
 Parties can engage in a ‘pull and refile’, wherein the acquiring person voluntarily withdraws and resubmits their HSR filing before the expiry of the 30-day waiting period and before a second request has been issued. A pull and refile can be done only once without requiring the payment of new filing fees. See 16 CFR §§ 803.12(a)–(c).
 See 15 USC § 18a(e)(1)(A).
 See ibid.
 Press Release, FTC, ‘FTC, DOJ Temporarily Suspend Discretionary Practice of Early Termination’ (4 February 2021), https://www.ftc.gov/news-events/press-releases/2021/02/ftc-doj-temporarily-suspend-discretionary-practice-early. The agencies had also suspended grants of early termination in March 2020 due to the covid-19 pandemic. Press Release, FTC, ‘Premerger Notification Office Implements Temporary e-Filing System’ (13 March 2020), https://www.ftc.gov/news-events/press-releases/2020/03/premerger-notification-office-implements-temporary-e-filing.
 DOJ, ‘Antitrust Division: Meet the Assistant Attorney General’ (10 May 2022), https://www.justice.gov/atr/staff-profile/meet-assistant-attorney-general. President Biden nominated Jonathan Kanter to serve as AAG. Press Release, The White House, ‘President Biden Announces Jonathan Kanter for Assistant Attorney General for Antitrust’ (20 July 2021), https://www.whitehouse.gov/briefing-room/statements-releases/2021/07/20/president-biden-announces-jonathan-kanter-for-assistant-attorney-general-for-antitrust/.
 FTC, ‘Inside the Bureau of Competition’, https://www.ftc.gov/about-ftc/bureaus-offices/bureau-competition/inside-bureau-competition (last visited 8 July 2022).
 Cecilia Kang, ‘Biden Nominates Lina Khan, a vocal critic of Big Tech, to the F.T.C.’, New York Times (22 March 2021), https://www.nytimes.com/2021/03/22/business/lina-khan-ftc.html.
 Cecilia Kang and David McCabe, ‘Biden Names Lina Khan, a Big-Tech Critic, as F.T.C. Chair’, New York Times (15 June 2021), https://www.nytimes.com/2021/06/15/technology/lina-khan-ftc.html.
 See, eg, Lina Khan, ‘Amazon Antitrust Paradox’, 126 Yale L. J. 710 (2017), https://www.yalelawjournal.org/pdf/e.710.Khan.805_zuvfyyeh.pdf.
 Cecilia Kang and David McCabe, footnote 14.
 ‘Senate confirms Rohit Chopra to lead the Consumer Financial Protection Bureau’, NPR (1 October 2021), https://www.npr.org/2021/10/01/1042310553/cfpb-senate-confirms-rohit-chopra-watchdog-consumer-financial-protection-bureau.
 Press Release, FTC, ‘Alvaro Bedoya Sworn in as FTC Commissioner’ (16 May 2022), https://www.ftc.gov/news-events/news/press-releases/2022/05/alvaro-bedoya-sworn-ftc-commissioner.
 FTC, Premerger Notification and the Merger Review Process, https://www.ftc.gov/advice-guidance/competition-guidance/guide-antitrust-laws/mergers/premerger-notification-merger-review-process (last visited 8 July 2022).
 FTC, ‘Tips on Withdrawing and Refiling an HSR Premerger Notification Filing’ (15 September 2017), https://www.ftc.gov/system/files/attachments/hsr-resources/withdraw_and_refile_procedures_tip_sheet_updated_091517.pdf.
 Press Release, FTC, ‘FTC to Restrict Future Acquisitions for Firms that Pursue Anticompetitive Mergers’ (25 October 2021), https://www.ftc.gov/news-events/news/press-releases/2021/10/ftc-restrict-future-acquisitions-firms-pursue-anticompetitive-mergers. As a practical consequence of this policy, companies, particularly highly acquisitive companies, may be incentivised to abandon potentially anticompetitive transactions to avoid what could be very burdensome compliance requirements under an FTC consent decree.
 The FTC lists multiple factors that may influence the scope of transactions requiring prior approval: (1) the nature of the transaction; (2) the level of market concentration; (3) the degree to which the transaction increases concentration; (4) the degree to which one of the parties pre-merger likely had market power; (5) the parties’ history of acquisitiveness; and (6) evidence of anticompetitive market dynamics. No one factor is dispositive in the FTC’s analysis; rather, the FTC plans to take a ‘holistic view of the circumstances when determining the length and breadth of Prior Approval provisions’. See Press Release, FTC, ‘Statement of the Commission on the Use of Prior Approval Provisions in Merger Orders’ (25 October 2021), https://www.ftc.gov/legal-library/browse/statement-commission-use-prior-approval-provisions-merger-orders.
 See, generally, DOJ, Antitrust Guidelines for International Enforcement and Cooperation (2017), https://www.justice.gov/atr/guidelines-and-policy-statements-0/antitrust-guidelines-international-enforcement-and-cooperation-2017 (last updated 23 March 2017).
 See, generally, DOJ, ‘Deputy Assistant Attorney General Michael Murray Delivers Remarks at Antonin Scalia Law School’ (31 August 2020), https://www.justice.gov/opa/speech/deputy-assistant-attorney-general-michael-murray-delivers-remarks-antonin-scalia-law.
 Although private plaintiffs do not participate in the merger review process, note that if a private plaintiff has proper standing, it can challenge a merger under federal antitrust law. See, eg, Steves and Sons, Inc. v Jeld-Wen, Inc., 988 F.3d 690 (4th Cir 2021). This is rare and almost always post-consummation.
 Note, however, that Connecticut and Washington both require pre-merger notification of certain healthcare-related transactions in their respective states. See An Act Concerning Notice of Acquisitions, Joint Ventures, Affiliations of Group Medical Practices and Hospital Admissions, Medical Foundations, and Certificates of Need, 2014 Public Act No. 14-168(c), available at https://www.cga.ct.gov/2014/ACT/pa/pdf/2014PA-00168-R00SB-00035-PA.pdf; Health Care Market Participants, RCW § 19.390, et seq., available at https://app.leg.wa.gov/RCW/default.aspx?cite=19.390&full=true. The New York Senate recently passed a sweeping premerger notification requirement, Senate Bill S933A, 2021–2022 N.Y. Leg. Sess., New York State Senate, www.nysenate.gov/legislation/bills/2021/s933 (see also Assembly Bill A1812A, 2021-2022 N.Y. Leg. Sess., New York State Senate, www.nysenate.gov/legislation/bills/2021/a1812/amendment/a), but it has not been passed by the New York General Assembly or presented to the governor for signature.
 Competition Policy International, ‘US: Valero enters antitrust battle with California AG over terminal purchase’ (13 July 2017), https://www.competitionpolicyinternational.com/us-valero-enters-antitrust-battle-with-california-ag-over-terminal-purchase/; Drew Fitzgerald, ‘Justice Department in Talks With States to Win Support for T-Mobile, Sprint Merger’, Wall Street Journal (25 July 2019),
 15 USC § 18.
 15 USC §§ 1 and 2.
 15 USC § 18.
 DOJ, Horizontal Merger Guidelines (HMG) (19 August 2010), https://www.justice.gov/atr/horizontal-merger-guidelines-08192010; FTC, Vertical Merger Guidelines (VMG) (30 June 2020),
 John O McGinnis and Andrew M Meerkins, ‘Dworkinian Antitrust’, 102 Iowa L. Rev. 1, 41–43 (2016), https://ilr.law.uiowa.edu/assets/Uploads/ILR-102-1-McGinnis.pdf; Carl Shapiro and Howard Shelanski, ‘Judicial Response to the 2010 Horizontal Merger Guidelines’, 58 Rev. Indus. Org. 51 (2020).
 HMG, § 2.
 id., § 4.
 id., § 5.
 id., § 6.
 id., § 7.
 id., § 8.
 id., § 9.
 id., § 10.
 id., § 11.
 Daniel P Culley and Steven C Scalop, ‘Vertical Merger Enforcement Actions: 1994 – April 2020’, Georgetown University Law Center (2020), https://scholarship.law.georgetown.edu/cgi/viewcontent.cgi?article=2541&context=facpub.
 Non-Horizontal Merger Guidelines, https://www.justice.gov/atr/page/file/1175141/download?splash=1.
 VMG, § 1.
 id., § 3.
 id., § 4(a).
 Complaint, United States v AT&T Inc. et al., No. 1:17-cv-02511, 2017 WL 5564815 (D.D.C. 20 November 2017), available at https://www.justice.gov/atr/case-document/file/1012916/download.
 VMG, § 4(a).
 id., § 4(b).
 id., § 5.
 id., § 6.
 Populists on both the left and the right have criticised current law, including the merger guidelines, as too permissive in allowing mergers. For example, Commissioner Chopra dissented from the adoption of the VMG. See Rohit Chopra, Dissenting Statement of Rohit Chopra Regarding the Publication of Vertical Merger Guidelines, Commission File No. P810034, Federal Trade Commission (30 June 2020), https://www.ftc.gov/system/files/documents/public_statements/1577503/vmgchopradissent.pdf. Senator Joshua Hawley (MO-R) has proposed legislation that would change the substantive standard for mergers. See Josh Hawley US Senator for Missouri: ‘Senator Hawley Introduces The “Trust-Busting for the Twenty-First Century Act”: A Plan to Bust Up Anti-Competitive Big Businesses’ (12 April 2021), https://www.hawley.senate.gov/senator-hawley-introduces-trust-busting-twenty-first-century-act-plan-bust-anti-competitive-big.
 See, eg, Bryan Koenig, ‘FTC’s Khan Says Labor “Absolutely” Part Of Merger Probes’, Law360 (9 June 2022), https://www.law360.com/articles/1501293/ftc-s-khan-says-labor-absolutely-part-of-merger-probes (‘We are not proactively, we do not proactively, investigate ESG claims, as a part of our investigations. I think there’s been some misconception around that. In terms of labor markets, absolutely. That’s an area where we are focusing.’).
 Executive Order No. 14036, 86 Fed. Reg. 36,987, at § 5 (9 July 2021).
 Press Release, FTC, ‘Statement of FTC Chair Lina Khan and Antitrust Division Acting Assistant Attorney General Richard A Powers on Competition Executive Order’s Call to Consider Revisions to Merger Guidelines’ (9 July 2021), https://www.ftc.gov/news-events/press-releases/2021/07/statement-ftc-chair-lina-khan-antitrust-division-acting-assistant.
 Press Release, FTC, ‘Statement of FTC Chair Lina Khan and Commissioners Chopra and Slaughter on the Withdrawal of the Vertical Merger Guidelines’ (15 September 2021), http://www.ftc.gov/system/files/documents/public_statements/1596396/statement_of_chair_lina_m_khan_commissioner_rohit_chopra_and_commissioner_rebecca_kelly_slaughter_on.pdf.
 Press Release, DOJ, ‘Justice Department and Federal Trade Commission Seek to Strengthen Enforcement Against Illegal Mergers’ (18 January 2022), https://www.justice.gov/opa/pr/justice-department-and-federal-trade-commission-seek-strengthen-enforcement-against-illegal.
 Press Release, DOJ, Assistant Attorney General Jonathan Kanter Delivers Remarks on Modernizing Merger Guidelines (18 January 2022), https://www.justice.gov/opa/speech/assistant-attorney-general-jonathan-kanter-delivers-remarks-modernizing-merger-guidelines. In that same press release, AAG Kanter criticised the HMG and VMG for setting up binary analyses that fail to recognise the competitive complexities posed by many modern transactions: ‘Second, the guidelines have bifurcated horizontal and vertical analysis, yet often transactions don’t neatly fit into these categorizations. Does the framing of horizontal versus vertical analysis itself narrow us to a two-dimensional view of modern markets that are often multi-dimensional? How should the guidelines account for these market realities?’
 Press Release, FTC, ‘Federal Trade Commission and Justice Department Seek to Strengthen Enforcement Against Illegal Mergers’ (18 January 2022), https://www.ftc.gov/news-events/news/press-releases/2022/01/federal-trade-commission-justice-department-seek-strengthen-enforcement-against-illegal-mergers.
 Cecilia Kang and David McCabe, ‘Antitrust Overhaul Passes Its First Tests. Now, the Hard Parts’, New York Times (29 June 2021), https://www.nytimes.com/2021/06/24/technology/antitrust-overhaul-congress.html.
 See Lina Khan and Richard Powers, FTC, DOJ, Hart-Scott-Rodino Annual Report (2020),
 id. at 2, Appendix A.
 However, experts expect that the agencies may dramatically increase the number of second requests going forward, and so these statistics from 2019 may not reflect the agencies’ practices in years to come. See Alex Wilts, ‘Ex-DOJ official: Expect more numerous and comprehensive second requests’, Global Competition Review (14 July 2021), https://globalcompetitionreview.com/gcr-usa/department-of-justice/ex-doj-official-expect-more-numerous-and-comprehensive-second-requests.
 See FTC, ‘Tips on Withdrawing and Refiling an HSR Premerger Notification Filing’, footnote 20.
 DOJ, Request for Additional Information and Documentary Material Issued to [Weebyewe Corporation], https://www.justice.gov/atr/file/706636/download (last visited 8 July 2022); FTC, Model Request for Additional Information and Documentary Material (Second Request) (April 2019), https://www.ftc.gov/system/files/attachments/merger-review/april2019_model_second_request_final.pdf.
 Aon’s recent attempted merger with Willis Towers Watson is a good example of this. See, eg, Steve Evans, ‘Failure of WTW merger over US DoJ trial date “unacceptable” – Aon’, Artemis (30 June 2021), https://www.artemis.bm/news/failure-of-wtw-merger-over-us-doj-trial-date-unacceptable-aon/ (‘In a motion filed in the US District of Columbia court where the DoJ hearing is being held, Aon’s attorneys explained that the end of February 2022 date is six months beyond the so-called “outside date” set in the original merger agreement, which was September 9th 2021. That is the date the parties had originally agreed the deal needed to be completed by, so the US DoJ’s setting of a date for trial far beyond this is seen as a significant impediment to getting the merger agreed and underway.’).
 DOJ, Model Timing Agreement, https://www.justice.gov/atr/page/file/1220616/download (last visited 12 July 2022); FTC, FTC Model Timing Agreement, https://www.ftc.gov/system/files/attachments/merger-review/ftc_model_timing_agreement_2-27-19_0.pdf (last visited 12 July 2022).
 See, eg, Ben Remaly, ‘FTC loses bid to block Philadelphia hospital merger’, Global Competition Review (9 December 2020), https://globalcompetitionreview.com/gcr-usa/federal-trade-commission/ftc-loses-bid-block-philadelphia-hospital-merger.
 Press Release, White House, ‘Remarks by President Biden at Signing of an Executive Order Promoting Competition in the American Economy’ (9 July 2021), https://www.whitehouse.gov/briefing-room/speeches-remarks/2021/07/09/remarks-by-president-biden-at-signing-of-an-executive-order-promoting-competition-in-the-american-economy/.
 Alexander Paul Okuliar and David J Shaw, ‘FTC Meeting Signals Aggressive and Novel Enforcement to Come’, Compliance & Enforcement, Program on Corporate Compliance and Enforcement at New York University School of Law, https://wp.nyu.edu/compliance_enforcement/2021/07/19/ftc-meeting-signals-aggressive-and-novel-enforcement-to-come/ (last visited 12 July 2022).
 Press Release, FTC, footnote 9.
 See Alex Wilts, footnote 67.
 See, eg, Ben Remaly, ‘FTC sends warnings that end of waiting period may not signal end of probe’, Global Competition Review (4 August 2021), https://globalcompetitionreview.com/gcr-usa/article/ftc-sends-warnings-end-of-waiting-period-may-not-signal-end-of-probe.
 See, eg, Matthew Perlman, ‘FTC Touts Labor As It Reviews Microsoft’s Activision Deal’, Law360 (17 June 2022), https://www.law360.com/articles/1503579/ftc-touts-labor-as-it-reviews-microsoft-s-activision-deal.
 Press Release, FTC, ‘FTC Sues to Block Lockheed Martin Corporation’s $4.4 Billion Vertical Acquisition of Aerojet Rocketdyne Holdings Inc.’ (25 January 2022), https://www.ftc.gov/news-events/news/press-releases/2022/01/ftc-sues-block-lockheed-martin-corporations-44-billion-vertical-acquisition-aerojet-rocketdyne.
 Press Release, Lockheed Martin, ‘Lockheed Martin Terminates Agreement To Acquire Aerojet Rocketdyne’ (13 February 2022), https://news.lockheedmartin.com/2022-02-13-Lockheed-Martin-Terminates-Agreement-to-Acquire-Aerojet-Rocketdyne.
 Department of Defense, ‘State of Competition within the Defense Industrial Base’ (15 February 2022), https://media.defense.gov/2022/Feb/15/2002939087/-1/-1/1/STATE-OF-COMPETITION-WITHIN-THE-DEFENSE-INDUSTRIAL-BASE.PDF, at 1.
 Press Release, FTC, ‘Statement Regarding Termination of Nvidia Corp.’s Attempted Acquisition of Arm Ltd.’ (14 February 2022), https://www.ftc.gov/news-events/news/press-releases/2022/02/statement-regarding-termination-nvidia-corps-attempted-acquisition-arm-ltd.
 Press Release, FTC, ‘FTC Sues to Block $40 Billion Semiconductor Chip Merger’ (2 December 2021), https://www.ftc.gov/news-events/news/press-releases/2021/12/ftc-sues-block-40-billion-semiconductor-chip-merger.
 Complaint, FTC, In the Matter of Nvidia Corporation, Softbank Group Corporation, and Arm, Ltd., File No. 2110015 (6 December 2021), https://www.ftc.gov/system/files/documents/cases/d09404_part_3_complaint_public_version.pdf.
 Press Release, FTC, footnote 87.
 Press Release, FTC, footnote 88.
 Complaint, United States v UnitedHealth Group Inc. et al., 1:22-cv099481 (24 February 2022),
 Press Release, DOJ, ‘Justice Department Sues to Block UnitedHealth Group’s Acquisition of Change Healthcare’ (24 February 2022), https://www.justice.gov/opa/pr/justice-department-sues-block-unitedhealth-group-s-acquisition-change-healthcare.
 ‘Federal judge sets Aug 1 trial date for government challenge of UnitedHealth deal’, Reuters (17 March 2022), https://www.reuters.com/business/healthcare-pharmaceuticals/federal-judge-sets-aug-1-trial-date-government-challenge-unitedhealth-deal-2022-03-17/.
 Press Release, FTC, ‘FTC and Rhode Island Attorney General Step in to Block Merger of Rhode Island’s Two Largest Healthcare Providers’ (17 February 2022), https://www.ftc.gov/news-events/news/press-releases/2022/02/ftc-rhode-island-attorney-general-step-block-merger-rhode-islands-two-largest-healthcare-providers.
 Complaint, In the Matter of Lifespan Corporation and Care New England Health System, File No. 2110031 (17 February 2022), https://www.ftc.gov/system/files/ftc_gov/pdf/d_9406_lifespan-cne_p3_complaint_public_redacted.pdf.
 Press Release, FTC, ‘Statement of Commissioners Noah Joshua Phillips and Christine Wilson on Lifespan/Care New England Health System’ (17 February 2022), http://www.ftc.gov/system/files/ftc_gov/pdf/2110031wilsonphillipslifespancnestatement.pdf.
 Alex Nadirashvili and Caleb Lazar, ‘Lifespan, Care New England withdraw hospital merger application’, Brown Daily Herald (23 February 2022), https://www.browndailyherald.com/article/2022/02/lifespan-care-new-england-withdraw-hospital-merger-application#:~:text=Lifespan%20and%20Care%
 Press Release, White House, ‘FACT SHEET: Executive Order on Promoting Competition in the American Economy’ (9 July 2021), https://www.whitehouse.gov/briefing-room/statements-releases/2021/07/09/fact-sheet-executive-order-on-promoting-competition-in-the-american-economy/.
 Press Release, FTC, ‘FTC Acts to Restore Competitive Markets for Gasoline and Diesel in Michigan and Ohio’ (14 June 2022), https://www.ftc.gov/news-events/news/press-releases/2022/06/ftc-acts-restore-competitive-markets-gasoline-diesel-michigan-ohio.
 Press Release, FTC, ‘Statement of Chair Lina Khan and Commissioners Slaughter and Bedoya in the Matter of ARKO Corp./Express Stop’ (10 June 2022), http://www.ftc.gov/system/files/ftc_gov/pdf/2110187GPMExpressKhanStatement.pdf.