[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 4308 Introduced in Senate (IS)]
<DOC>
118th CONGRESS
2d Session
S. 4308
To reform the antitrust laws to better protect competition in the
American economy, to amend the Clayton Act to modify the standard for
an unlawful acquisition, to deter anticompetitive exclusionary conduct
that harms competition and consumers, to enhance the ability of the
Department of Justice and the Federal Trade Commission to enforce the
antitrust laws, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 9, 2024
Ms. Klobuchar (for herself, Mr. Blumenthal, Mr. Whitehouse, Ms. Hirono,
Mr. Booker, Mr. Welch, Mr. Warner, Mr. Wyden, Mr. Heinrich, Mr. Markey,
Mr. Schatz, and Ms. Smith) introduced the following bill; which was
read twice and referred to the Committee on the Judiciary
_______________________________________________________________________
A BILL
To reform the antitrust laws to better protect competition in the
American economy, to amend the Clayton Act to modify the standard for
an unlawful acquisition, to deter anticompetitive exclusionary conduct
that harms competition and consumers, to enhance the ability of the
Department of Justice and the Federal Trade Commission to enforce the
antitrust laws, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Competition and Antitrust Law
Enforcement Reform Act of 2024''.
SEC. 2. FINDINGS AND PURPOSES.
(a) Findings.--Congress finds that--
(1) competitive markets, in which multiple firms compete to
buy and sell products and services, are critical to ensuring
economic opportunity for all people in the United States and
providing resilience to the economy during unpredictable times;
(2) when companies compete, businesses offer the highest
quality and choice of goods and services for the lowest
possible prices to consumers and other businesses;
(3) competition fosters small business growth, reduces
economic inequality, and spurs innovation and job creation;
(4) competitive markets are crucial for the United States
global economic competitiveness and national security;
(5) in the United States economy today, the presence and
exercise of market power is substantial and growing;
(6) the presence and exercise of market power makes it more
difficult for people in the United States to start their own
businesses, depresses wages, and increases economic inequality,
with particularly damaging effects on historically
disadvantaged communities;
(7) market power and undue market concentration contribute
to the consolidation of political power, undermining the health
of democracy in the United States;
(8) the anticompetitive effects of monopoly power or buyer
market power include higher prices, lower quality, lessened
choice, reduced innovation, foreclosure of competitors, and
increased entry barriers;
(9) monopsony power or seller market power allows a firm to
force suppliers of goods or services to accept below market
prices or to force workers to accept below market wages,
resulting in lower quality products and services, reduced
opportunities for suppliers and workers, reduced availability
of products and services for consumers, reduced innovation,
foreclosure of competitors, and increased entry barriers;
(10) horizontal consolidation, vertical consolidation, and
conglomerate mergers all have the potential to increase market
power and cause anticompetitive harm;
(11) extensive consolidation is reducing competition and
threatens to place the American dream further out of reach for
many consumers in the United States;
(12) since 2008, firms in the United States have engaged in
over $10,000,000,000,000 in mergers and acquisitions;
(13) the acquisition of nascent or potential rivals by
dominant firms can present significant long-term threats to
competition and innovation and harm the global economic
competitiveness of the United States;
(14) the acquisition, by one of its competitors, of a
maverick firm that plays a disruptive role in the market, by
using an innovative business model or technology, offering
lower prices or new, different products or services products,
or by other means that benefit consumers, often presents a
threat to competition;
(15) section 7 of the Clayton Act (15 U.S.C. 18) is the
primary line of defense against anticompetitive mergers;
(16) in recent years, some court decisions and enforcement
policies have limited the vitality of the Clayton Act to
prevent harmful consolidation by--
(A) discounting previously accepted presumptions
that certain acquisitions are anticompetitive;
(B) focusing inordinately on the effect of an
acquisition on price in the short term, to the
exclusion of other potential anticompetitive effects;
(C) underestimating the dangers that horizontal,
vertical, and conglomerate mergers will lower quality,
reduce choice, impede innovation, exclude competitors,
increase entry barriers, or create buyer power,
including monopsony power;
(D) failing to properly account for direct evidence
of competitive harm, including intent evidence; and
(E) requiring the government to prove harmful
effects of a proposed merger to a near certainty;
(17) anticompetitive exclusionary conduct constitutes a
particularly harmful exercise of market power and a substantial
threat to the United States economy;
(18) when dominant sellers exercise market power, they harm
buyers by overcharging them, reducing product or service
quality, limiting their choices, and impairing innovation;
(19) when dominant buyers exercise market power, they harm
suppliers by underpaying them, limiting their business
opportunities, and impairing innovation;
(20) when dominant employers exercise market power, they
harm workers by paying them low wages, reducing their benefits,
and limiting their future employment opportunities;
(21) nascent or potential rivals, even those that are
unprofitable or inefficient, are an important source of
competitive discipline for dominant firms;
(22) antitrust enforcement against anticompetitive
exclusionary conduct has been impeded when courts have declined
to rigorously examine the facts in favor of relying on
inaccurate economic assumptions that are inconsistent with
contemporary economic learning, such as presuming that market
power is not durable and can be expected to self-correct, that
monopolies can drive as much or more innovation than a
competitive market, that above-cost pricing cannot harm
competition, and other flawed assumptions;
(23) the courts of the United States have improperly
implied immunity from the antitrust laws based on Federal
regulatory statutes, even limiting the application of statutory
antitrust savings clauses passed by Congress;
(24) the civil remedies currently available to cure
violations of the Sherman Antitrust Act, including injunctions,
equitable monetary relief, and private damages, have not proven
sufficient, on their own, to deter anticompetitive conduct;
(25) in some cases, effective deterrence requires the
imposition of civil penalties, alone or in combination with
existing remedies, including structural relief, behavioral
relief, private damages, and equitable monetary relief,
including disgorgement and restitution; and
(26) Federal antitrust enforcement budgets have failed to
keep pace with the growth of the economy and increasing demands
on agency resources, significantly undermining the ability of
the Federal antitrust agencies to fulfill their law enforcement
missions and contributing to the rise of market power in the
American economy.
(b) Purposes.--The purposes of this Act are to--
(1) enhance competition throughout the American economy by
strengthening antitrust enforcement by the Department of
Justice, the Federal Trade Commission, the State enforcement
agencies, and private parties;
(2) revise the legal standard under section 7 of the
Clayton Act to better enable enforcers to arrest the likely
anticompetitive effects of harmful mergers in their incipiency,
as Congress intended, by clarifying that the potential effects
that may justify prohibiting a merger under the Clayton Act
include lower quality, reduced choice, reduced innovation, the
exclusion of competitors, or increased entry barriers, in
addition to increased price to buyers or reduced price to
sellers;
(3) amend the Clayton Act to clarify that an acquisition
that tends to create a monopsony violates the Clayton Act;
(4) establish simple, cost-effective decision rules that
require the parties to certain acquisitions that either
significantly increase concentration or are extremely large
bear the burden of establishing that the acquisition will not
materially harm competition;
(5) prohibit and deter exclusionary conduct that harms
competition, particularly by dominant firms;
(6) enable the Department of Justice and the Federal Trade
Commission to seek civil monetary penalties, in addition to
existing remedies, for violations of the Sherman Act;
(7) give the Department of Justice and the Federal Trade
Commission additional financial resources and enforcement tools
to craft remedies for individual violations that are effective
to deter future unlawful conduct and proportionate to the
gravity of the violation;
(8) provide further protections for those who provide
evidence of anticompetitive conduct to government enforcers and
potential financial rewards for whistleblowers who provide
information to the government that leads to a criminal fine;
and
(9) grant successful antitrust plaintiffs the right to
obtain prejudgment interest on damages awards to further deter
anticompetitive conduct and increase compensation to injured
parties.
SEC. 3. DEFINITION.
In this Act the term ``antitrust laws''--
(1) has the meaning given that term in the first section of
the Clayton Act (15 U.S.C. 12); and
(2) includes--
(A) section 5 of the Federal Trade Commission Act
(15 U.S.C. 45) to the extent that such section applies
to unfair methods of competition; and
(B) this Act and the amendments made by this Act.
SEC. 4. UNLAWFUL ACQUISITIONS.
(a) Market Power.--Subsection (a) of the first section of the
Clayton Act (15 U.S.C. 12) is amended by adding at the end the
following:
``The term `market power' in this Act means the ability of a
person, or a group of persons acting in concert, to profitably impose
terms or conditions on counterparties, including terms regarding price,
quantity, product or service quality, or other terms affecting the
value of consideration exchanged in the transaction, that are more
favorable to the person or group of persons imposing them than what the
person or group of persons could obtain in a competitive market.''.
(b) Unlawful Acquisitions.--Section 7 of the Clayton Act (15 U.S.C.
18) is amended--
(1) in the first and second undesignated paragraphs, by
striking ``substantially to lessen'' each place that term
appears and inserting ``to create an appreciable risk of
materially lessening'';
(2) by inserting ``or a monopsony'' after ``monopoly'' each
place that term appears; and
(3) by adding at the end the following:
``In a case brought by the United States, the Federal Trade
Commission, or a State attorney general, a court shall determine that
the effect of an acquisition described in this section may be to create
an appreciable risk of materially lessening competition or to tend to
create a monopoly or a monopsony, in or affecting commerce, if--
``(1) the acquisition would lead to a significant increase
in market concentration in any relevant market;
``(2) the acquisition would increase the ability and
incentive to engage in exclusionary conduct, as defined in
section 26A of the Clayton Act;
``(3)(A) the acquiring person has a market share of greater
than 50 percent or otherwise has significant market power, as a
seller or a buyer, in any relevant market, and as a result of
the acquisition, the acquiring person would obtain control over
entities or assets that compete or have a reasonable
probability of competing with the acquiring person in the same
relevant market; or
``(B) as a result of the acquisition, the acquiring person
would obtain control over entities or assets that have a market
share of greater than 50 percent or otherwise have significant
market power, as a seller or a buyer, in any relevant market,
and the acquiring person competes or has a reasonable
probability of competing with the entities or assets over which
it would obtain control, as a result of the acquisition, in the
same relevant market;
``(4) the acquisition would lead to the combination of
entities or assets that compete or have a reasonable
probability of competing in a relevant market, and either the
acquiring person or the entities or assets over which it would
obtain control prevents, limits, or disrupts coordinated
interaction among competitors in a relevant market or has a
reasonable probability of doing so;
``(5) the acquisition--
``(A) would likely enable the acquiring person to
unilaterally and profitably exercise market power or
materially increase its ability to do so; or
``(B) would materially increase the probability of
coordinated interaction among competitors in any
relevant market; or
``(6)(A) the acquisition is not a transaction that is
described in section 7A(c); and
``(B)(i) as a result of such acquisition, the acquiring
person would hold an aggregate total amount of the voting
securities and assets of the acquired person in excess of
$5,000,000,000 (as adjusted and published for each fiscal year
beginning after September 30, 2024, in the same manner as
provided in section 8(a)(5) to reflect the percentage change in
the gross national product for such fiscal year compared to the
gross national product for the year ending September 30, 2023;
or
``(ii)(I) the person acquiring or the person being acquired
has assets, net annual sales, or a market capitalization
greater than $100,000,000,000 (as so adjusted and published);
and
``(II) as a result of such acquisition, the acquiring
person would hold an aggregate total amount of the voting
securities and assets of the acquired person in excess of
$50,000,000 (as so adjusted and published), unless the
acquiring or acquired person establishes, by a preponderance of
the evidence, that the effect of the acquisition will not be to
create an appreciable risk of materially lessening competition
or will not tend to create a monopoly or a monopsony. In this
paragraph, the term `materially' means more than a de minimis
amount''.
SEC. 5. POST-PROCEEDING DATA.
Section 7A of the Clayton Act (15 U.S.C. 18a) is amended by adding
at the end the following:
``(l)(1) Each person who resolves a proceeding brought under the
antitrust laws by the Federal Trade Commission or United States by
entering into an agreement or by the final judgment in a Federal or
administrative court regarding an acquisition with respect to which
notification is required under this section shall, on an annual basis
during the 5-year period beginning on the date on which the agreement
is entered into, file with the Federal Trade Commission or the
Assistant Attorney General, as applicable, and the Competition
Advocate, information sufficient for the Federal Trade Commission or
the United States, as applicable, to assess the competitive impact of
the acquisition, including--
``(A) the pricing, availability, and quality of any product
or service, or inputs thereto, in any market, that was covered
by the agreement;
``(B) the source, and the resulting magnitude and extent,
of any cost-saving efficiencies or any benefits to consumers or
trading partners that were claimed as a benefit of the
acquisition and the extent to which any cost savings were
passed on to consumers or trading partners; and
``(C) the effectiveness of any divestitures or any
conditions placed on the acquisition in fully restoring
competition.
``(2) The requirement to provide the information described in
paragraph (1) shall be included in an agreement described in that
paragraph.
``(3) The Federal Trade Commission, with the concurrence of the
Assistant Attorney General, by rule in accordance with section 553 of
title 5, United States Code, and consistent with the purposes of this
section--
``(A) shall require that the information described in
paragraph (1) be in such form and contain such documentary
material and information relevant to an acquisition as is
necessary and appropriate to enable the Federal Trade
Commission and the Assistant Attorney General to assess the
competitive impact of the acquisition under paragraph (1); and
``(B) may--
``(i) define the terms used in this subsection;
``(ii) exempt, from the requirements of this
section, information not relevant in assessing the
competitive impact of the acquisition under paragraph
(1); and
``(iii) prescribe such other ru