Trump Administration Upholds Key Biden-Era Policy on Corporate Mergers: A Surprising Continuity in Antitrust Enforcement

Introduction: A Shift in Antitrust Policy Landscape

In a move that has sparked both surprise and debate, the Trump administration has decided to retain a significant policy framework established during the Biden era. Specifically, the administration will continue to use the 2023 merger guidelines set by the Federal Trade Commission (FTC) to review proposed mergers and acquisitions. This decision, announced by new FTC Chair Andrew Ferguson, indicates a notable continuity in antitrust enforcement policies despite the change in leadership. The guidelines, though not legally binding, serve as crucial tools for providing clarity to companies, courts, and regulatory agencies on how mergers are assessed for their impact on competition.

The Merger Guidelines: A Framework for Competition Review

The 2023 merger guidelines were introduced under the Biden administration, marking the first major update to U.S. merger review processes in over a decade. These guidelines emphasize a more stringent examination of how mergers could affect worker wages and the competitive dynamics of online markets. They were a cornerstone of the Biden administration’s aggressive approach to antitrust enforcement, driven by then-FTC Chair Lina Khan and Justice Department antitrust chief Jonathan Kanter. This approach led to challenges against several high-profile mergers, particularly targeting tech giants like Google, Amazon, and Meta, signaling a tough stance on corporate consolidation.

Business Reaction: From Criticism to Cautious Optimism

The FTC under Lina Khan faced significant backlash from the business community, with critics accusing the agency of stifling innovation and competition. Corporate leaders and industry groups expressed relief at Khan’s departure, anticipating a more lenient approach under the Trump administration. They expected a wave of new mergers, unshackled by the stringent guidelines of the previous administration. However, with the retention of the 2023 guidelines, the business community is now adjusting its expectations. While some remain hopeful for a less aggressive enforcement regime, others are wary of the signals sent by the Trump administration’s early moves.

Enforcement Under Trump: A Balancing Act

The decision to retain the merger guidelines does not necessarily indicate that the Trump FTC will pursue enforcement with the same vigor as its predecessor. The administration’s approach to antitrust enforcement is still unfolding, with some early signs suggesting a mixed strategy. For instance, the FTC has already moved to block a major tech deal—Hewlett Packard Enterprise’s $14 billion acquisition of Juniper Networks—the first significant merger challenge under the Trump administration. This move serves as a potential bellwether for how the administration will handle corporate tie-ups.

Stakeholder Reactions: Advocates and Critics Weigh In

Advocates of stricter antitrust enforcement have welcomed Ferguson’s decision, viewing it as a signal of bipartisan support for robust merger oversight. Nidhi Hegde of the American Economic Liberties Project highlighted the move as a "pretty big step in the revival of antitrust," emphasizing the importance of maintaining a stable and predictable framework for businesses and courts. Conversely, industry allies and tech advocates have criticized the decision, arguing that the guidelines are flawed and could stifle innovation and competition.

Conclusion: Stability vs. Enforcement—The Path Ahead

The retention of the 2023 merger guidelines reflects the Trump administration’s prioritization of stability over a complete overhaul of antitrust policies. Ferguson’s rationale for maintaining the guidelines underscores the importance of providing consistent guidance to businesses and regulatory agencies, ensuring that companies can plan for the future without the uncertainty of frequently changing rules. However, the actual enforcement trajectory under the Trump FTC remains to be seen, with questions lingering about resource allocation and the aggressiveness of future challenges. As the administration navigates this complex landscape, stakeholders will be closely watching to gauge whether the continuity in policy framework translates into a continuation of vigorous enforcement or a more hands-off approach.