US antitrust reform legislation is racing against the midterm election clock

03 January 2022 15:00 by Max Fillion

finish line

The year 2021 looked like it was going to be a big one for US antitrust reform: Democrats and Republicans alike introduced a series of sweeping measures that would fundamentally change the shape of competition enforcement. But lawmakers have yet to pass any of the bills and now they are racing against a clock that would reset the legislation back to square one.

On Nov. 8, 2022, the US will have its midterm elections in which a third of US Senate seats and all 435 spots in the House will be up for grabs. In early January, the winners will be sworn in, a new session of Congress will start and votes on all pending legislation will be wiped away, leaving lawmakers to decide whether to re-introduce the bills and start the voting process all over again.

The window for passing major antitrust legislation will likely close before then, however, as the fall of a midterm year is dominated by electioneering, and a so-called “lame duck” Congress is typically hesitant to pass major reform. So when lawmakers get back from their holiday break, they’ll realistically have until the August recess to get any major reform passed.

“I absolutely think this is a key moment when we really have a great opportunity to address the power of these powerful companies,” Charlotte Slaiman, the Competition Policy Director for left-leaning Public Knowledge, told MLex. “It really would be a shame to lose that moment. I do think it’s going to be a lot harder after this Congress to try to achieve these ambitious goals.”

And they’ve got a lot of goals teed up, as lawmakers on both sides of the aisle have introduced measures ranging from proposals to increase funding for the US Federal Trade Commission and US Department of Justice, to bills that would alter merger litigation. But following the introduction of antitrust reform legislation, progress has been hard to come by, and full chamber votes have been even rarer.

Package of bills

Take, for example, the package of six bills aimed at boosting antitrust enforcement against Big Tech companies — introduced by members of the House antitrust subcommittee following its investigation of competition in digital markets.

Lawmakers worked overnight to get the bills through a markup by the House Judiciary Committee, but the legislation is still waiting on a vote by the full chamber. House Majority Leader Steny Hoyer, who controls the vote calendar, said in June the bills were not yet ready for a vote by the full House. Discussion on the way forward, Hoyer said, would be dependent on what the leadership in the Senate believes can be passed.

But Senate leadership has only held a floor vote on one of the bills passed by the House antitrust subcommittee: the Merger Filing Fees Modernization Act. And that bill, which would increase filing fees for big mergers, originated in the Senate and was passed two weeks prior to the House markup of the Big Tech package.

Aside from that, senators have introduced companions for three other bills passed by the House antitrust subcommittee: a measure limiting self-preferencing by Big Tech companies; a bill that would give state antitrust enforcers deference in choosing which court to bring antitrust suits in; and a bill that would limit tech platforms’ ability to engage in mergers and acquisitions.

And those bills, while receiving bipartisan sponsorship, haven’t made much progress. The State Antitrust Enforcement Venue Selection Act, thought of as one of the least controversial measures in the House antitrust subcommittee package, was passed out of the Senate Judiciary Committee in September and still hasn’t received a floor vote in either chamber.

An antitrust official for the state of Virginia said at a recent conference that the delay is due to a provision that would make the bill retroactively go into effect on June 1, 2021, affecting a monopolization suit against Google filed by a Texas-led group of state attorneys general.

Self-preferencing

The self-preferencing bill, which would bar tech companies from giving preferential treatment to their own products over those of third parties operating on their platforms, was introduced in the Senate in October and has yet to move since then. The measure limiting platform mergers has similarly not moved since Senators Amy Klobuchar and Tom Cotton introduced it in November.

Aside from the tech bills, the only other antitrust reform measures that have made it out of a committee this session are a series of bills aimed at stopping patent abuse and other anticompetitive behavior in the pharmaceutical industry.

But those bills haven’t moved in the Senate since passing out of the Judiciary Committee at the end of July. The House Judiciary Committee passed them in September), but the bills have yet to get a full floor vote.

Even a boost in funding for the FTC and DOJ, long a point of consensus for Republicans and Democrats, hit a snag when Senator Joe Manchin shot down the Build Back Better Act, a social spending bill that included a $1 billion pot to be split between the federal antitrust enforcers.

Lawmakers were considering US President Joe Biden’s request for smaller funding increases for each agency as part of his budget request for Fiscal Year 2022, but they have yet to pass the FY22 budget bills. Biden signed a stopgap measure in December funding the government through Feb. 18.

Tenuous coalitions

In addition to their race against time, the bills have to navigate tenuous political coalitions to survive a full chamber vote. Democrats, who have shown wider support for reform measures, control both the House and Senate, but they still face obstacles in each.

They don’t have a big enough majority in the Senate to pass legislation on their own, meaning they would likely need 10 Republicans — or more if some Democrats vote against the bills — to get the 60 votes typically needed to pass legislation. In the House, a faction of Democrats from California, the home of three of the four Big Tech companies, has voiced strong opposition to legislation targeting the industry.

During the markup of the House antitrust subcommittee’s Big Tech package, however, California Democrats were outnumbered by Republicans looking to rein in Big Tech due to their perception that the companies are biased against conservatives. All of the bills passed, despite California Democrats’ no votes, although several of the more wide-sweeping measures passed along narrow margins.

“The crucial question is how many Republicans are going to back you up on each of these and if you get some Democrats defecting because they are going to stand up for Big Tech, do you get enough Republicans to offset them,” said Bill Kovacic, a former FTC chair.

Appointments

Despite Republicans’ support for a number of the legislative proposals, they’ve also criticized the current leadership of both agencies and may be wary of giving them more powers than they already have.

During a recent vote on whether to nominate Georgetown Law professor Alvaro Bedoya to serve as an FTC commissioner, which would give Chair Lina Khan her much-needed majority, Republican Senator Roger Wicker said he was hesitant to confirm him because he may add to the “troubling trend of politicization at the FTC, which is different from how it’s been.”

And Senator John Cornyn, a Texas Republican, in a vote on whether to confirm Jonathan Kanter to head the DOJ’s antitrust division, said he agreed with Kanter's views on tech but is concerned Kanter would use antitrust as a “hammer to achieve political ends,” So he voted no.

Antitrust reform advocates would do well to convince the likes of Cornyn and Wicker that the threat posed by monopolies is greater than their disagreements with agency leadership if they want to get reform passed by the midterm deadline.

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