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The Antitrust Source

The Antitrust Source | December 2023

A Summary of Comments on the 2023 Draft Merger Guidelines

Kate Maxwell Koegel, Ana McDowall, and Lorenzo Michelozzi


  • In July 2023, the FTC and DOJ jointly issued Draft Merger Guidelines to better reflect how the Agencies determine a merger’s competitive effects in the modern economy and invited the public to comment on the document over a 60-day period.
  • While many commenters praised the Agencies’ tougher stance on merger enforcement, other commenters expressed concerns that the large changes in structure and organization of content could harm the credibility and usefulness of the document.
  • Some comments voiced concerns about specific changes to the guidelines: for example, some commenters were critical of the increased focus on structural evidence or felt that specific Guidelines (6 and 7) were economically unsound. Others praised those changes.
  • However, many of the comments highlighted areas where the Draft Merger Guidelines lacked clarity and the Agencies could elaborate and clarify their guidance as they revise the document, without compromising on their enforcement goals.
A Summary of Comments on the 2023 Draft Merger Guidelines
Siegfried Layda via Getty Images

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On July 19, 2023, the Federal Trade Commission and the Department of Justice (jointly, the Agencies) released a draft update to the merger guidelines (DMGs). The proposed draft document would replace the 2010 Horizontal Merger Guidelines (2010 HMGs) and the 2020 Vertical Merger Guidelines (2020 VMGs), the latter of which were withdrawn by the FTC 15 months after being issued. The Agencies invited comments on the draft and, over a 60-day period, received 1,600 comments from antitrust practitioners, industry participants, and the general public.

Many commenters simply provided statements of support or disapproval for the DMGs, while a smaller group of 211 comments provided more articulated feedback by attaching essays that develop arguments for the authors’ positions. This article summarizes our review of these 211 comments, which come from a wide spectrum of stakeholders. We note that, as economists, we focus our summary on commentary that speaks more directly to the economic analysis that arises in merger review.

Our reading of the views expressed is that the Agencies’ bold approach and tougher stance on merger enforcement, in particular for mergers involving large firms, struck a chord with many. However, there were also those who worried that the many innovations introduced by the DMGs relative to prior guidelines—such as the organization of the material into 13 standalone Guidelines with different approaches and degrees of detail, the inclusion of a broader set of competitive concerns, and the addition of legal citations—diminish the clarity and credibility of the guidelines.

Taken together, the comments indicate that there is room for the Agencies to accommodate the feedback received and clarify their guidance while keeping their priorities firm. For example, the Agencies could revise the DMGs to better explain how they interpret a lessening of competition; what role structural evidence will play going forward; how the different Guidelines relate to one another and can be rebutted; and what role efficiencies play in the analysis of mergers. Some of these revisions may also help bring back the clarity of the economics—and the teaching value—of previous merger guidelines.

The Agencies’ Tougher Stance on Enforcement Finds a Good Amount of Support, but There Are Concerns About the Reorganization of the Material and the Inclusion of Legal Citations

When the Agencies released the DMGs, they explained that the updated draft guidelines aimed to better reflect how the Agencies determine a merger’s effect on competition in the modern economy. FTC Chair Lina Kahn noted, at the time of the release, “[with] these draft Merger Guidelines, we are updating our enforcement manual to reflect the realities of how firms do business in the modern economy…these guidelines contain critical updates while ensuring fidelity to the mandate Congress has given us and the legal precedent on the books.” Similarly, Assistant Attorney General Jonathan Kanter stated that the DMGs “are faithful to the law, which prevents mergers that threaten competition or tend to create monopolies. As markets and commercial realities change, it is vital that we adapt our law enforcement tools to keep pace so that we can protect competition in a manner that reflects the intricacies of our modern economy.”

Many commenters applauded the Agencies’ effort to update the guidelines, observing that mergers that harm competition have been allowed in recent decades and that increasing enforcement is in order. Others expressed skepticism about the need to increase enforcement, observed that over-enforcement could preempt or deter mergers that would benefit the economy, or criticized the update to the guidelines as an attempt to remake the law to fit policy priorities of the Agencies’ leadership.

The substantial revisions in the presentation of materials relative to prior guidelines also proved controversial, even among commenters who support stronger enforcement.

One of the innovations in the DMGs that sparked the most controversy is the inclusion of extensive citations to case law. Some commenters praised the approach of anchoring the analytical approach in the law that the Agencies are called to enforce. However, many disagreed with this approach—some of them vehemently—stating that it turned the guidelines into a legal brief, and imperiled their achievements to date: to support courts and practitioners by providing a summary of the conceptual and methodological tools in economics used by the Agencies to evaluate mergers.

Several commenters pointed out that the DMGs mostly cite case law from more than 50 years ago, and neglect more recent Supreme Court decisions in antitrust matters more widely, as well as the record in lower courts on merger matters, thus raising the concern that the selection of legal citations is inadequate or potentially partisan. Some also observed that using the guidelines to convey how the Agencies currently interpret merger law could lead to substantial revisions of the guidelines or to their retraction when administrations change. This stands in contrast to prior merger guidelines, which focused on summarizing consensus economics and, therefore, evolved only gradually as economic research advanced.

Another feature of the DMGs that some commenters found to be misaligned with standard economic approaches is the organization of the analysis into 13 standalone Guidelines. Commenters pointed out that these Guidelines often overlap in terms of addressing the same economic mechanism (for example, Guidelines 5 and 6 or Guidelines 1, 2, and 4), and in some cases are not tied to any specific economic mechanism (Guidelines 7 and 8). This is again a departure from prior merger guidelines which provided overarching frameworks for analyzing theories of competitive harm and for organizing the supporting evidence.

Some commenters concluded that an important downside of mixing legal and economic analysis and breaking up the overall economic frameworks into component pieces is that the teaching value of the merger guidelines is greatly diminished: readers are left to disentangle law from economics, the connections between the different Guidelines, and how the different types of evidence are used to build a picture of the effects of a merger. Further, diluting the economics in a document that also covers legal analysis may lead to the inference that the economic principles follow from case law, and might complicate the use of the guidelines as an authoritative text about economics upon which economic experts may rely.

To address these concerns, commenters proposed a wide range of revisions: simple additions to the text such as the re-introduction of a unifying theme of market power; the use of examples (as in the 2010 HMGs) to clarify the economics underlying individual Guidelines; the inclusion of a more comprehensive and balanced review of case law; or a thorough reorganization of the document splitting out the legal analysis into a separate document or legal appendix.

The Emphasis on Structural Evidence and Presumptions

In a reversal to the direction taken in previous merger guidelines, the DMGs appear to re-assign an augmented role to structural evidence. This sparked a substantial debate. Several commenters argued that the DMGs could be interpreted as supporting the proposition that increases in concentration are, in and of themselves, a lessening of competition, or are conclusive evidence of it. Some also pointed out that this approach is especially precarious given the removal of language from the 2010 HMGs that established the “unifying theme of the guidelines”—“that mergers should not be permitted to create, enhance, or entrench market power or to facilitate its exercise.” If the omission of language on market power was accidental, commenters proposed for the unifying theme to be reinstated at the start of the document, and for the Guidelines to clarify that structural evidence matters only inasmuch as it speaks to how the merger may enhance market power. Alternatively, if the implied goal of deconcentration is intended, then it may be helpful to be explicit about it and explain that this goal is grounded in the law (since it does not follow from the economics).

When it comes to the specific Guidelines that are based on structural evidence—i.e., levels and changes in concentration and market shares—we see a range of positions and varying reactions and recommendations depending on the specific Guideline.

  • Several commenters welcomed an augmented role for structural presumptions in merger enforcement. These commenters viewed structural presumptions as a more transparent framework for evaluating competitive harm and a critical tool for enforcers to bring more cases and shift the burden of evidence to the merging parties. Some supporters of stronger reliance on structural presumptions called for more explicit language defining these presumptions of illegality and/or further lowering the concentration thresholds for Guideline 1.
  • Even those commenters who were critical of the excessive focus on structural evidence did not object to structural presumptions altogether. The 2010 HMGs already included rebuttable presumptions for horizontal mergers, and there was little resistance to continuing that approach, although some commenters considered the lower thresholds in Guideline 1 relative to the 2010 HMGs to be unwarranted. Further, other Guidelines that appear to introduce new structural presumptions were met with concern by some. Guideline 8 in particular, which raises a concern for mergers that “further a trend towards concentration,” received considerable pushback, with those opposed to the Guideline opining that such a trend could just as likely signal a procompetitive tendency towards consolidation as an anticompetitive one.
  • Further, some commenters pointed out that increased reliance on market structure will reinforce the prominence of market definition—a pre-requisite for calculating meaningful shares—in contrast with the Agencies’ apparent effort to de-emphasize it elsewhere in the DMGs.

Given the extent and variety of reactions generated by the DMGs’ renewed emphasis on structural evidence, it is reasonable to expect that the Agencies will seek to better clarify the role and purpose that such evidence will play in merger review going forward. Clarifying, as an overall theme, that merger review is focused on evaluating whether a merger is likely to enhance market power, and that structural evidence provides useful indicators of likely competitive effects of a merger and rebuttable presumptions for harm, could assuage some stakeholders’ concerns about the emphasis on structural presumptions in the DMGs.

Guidance on Non-Horizontal Theories of Harm

Guidelines 5, 6, and 7 of the DMGs all address theories of harm that arise from combining firms operating in vertically related or adjacent markets. While Guideline 5 was well received, Guidelines 6 and 7 proved controversial.

Guideline 5, which brings back the ability and incentive framework for foreclosure concerns set out in the 2020 VMGs, met with few objections and was praised for its flexibility in dealing with mergers of complements generally, not just those from combining firms at different stages of the supply chain (i.e., vertical mergers). Some commenters proposed to expand Guideline 5 (or the technical appendix) with economic tools that provide further guidance on how to analyze the competitive effects for mergers of complements, such as vertical arithmetic and upward price pressure indices.

Some commenters called for the elimination of Guideline 6 or for it to be, at least, clearly presented as a rebuttable presumption within Guideline 5, primarily based on a concern that the 50% threshold for the presumption lacks a sound economic basis. Some commenters, however, considered a simple share-based presumption a valuable assessment of vertical mergers, including, for example, by bringing vertical merger enforcement in line with laws on vertical restraints, which also have share-based presumptions of illegality.

Another feature of Guideline 6 that met with opposition was the inclusion of “a trend towards vertical integration” as one of the plus factors for vertical mergers, as well as the statement that efficiencies are not cognizable if they will accelerate such a trend. Commenters pointed out that shifts in technology and other industry trends can lead to vertical integration that corresponds with greater efficiency and does not involve anticompetitive behavior.

Several commenters also lamented the absence in Guideline 6 (and Guideline 5) of a recognition that non-horizontal mergers have higher potential for procompetitive effects than horizontal mergers. In particular, some commenters found the lack of a discussion of the elimination of double marginalization (EDM) a notable omission. They argued EDM involves a change in incentives that can arise for a merger of complements without any change to the firm’s productive capabilities and needs to be part of the assessment of competitive effects.

Guideline 7 addresses situations in which a “dominant” firm may seek to entrench its dominant position, or leverage it into another market, through a merger. Some commenters did see value in expanding the merger guidelines beyond the more standard set of theories/concerns (unilateral effects, coordinated effects, and vertical foreclosure). However, there seemed to be some confusion about what economic theories of harm Guideline 7 is bringing forward that are not already covered in other Guidelines.

Some of the theories identified by commenters as potentially distinct from the theories already covered in other Guidelines included: cross-market mergers in healthcare; concerns about data at one level of the supply chain being used anticompetitively at other levels; and the acquisition by a firm of a service that supports multi-homing by its consumers.

While Guideline 7 does include some pointers for the defining features of these novel theories of harm, commenters expressed concern that no analytical framework for their assessment is provided. For example, there is no guidance on how the Agencies will distinguish between entrenchment resulting from procompetitive conduct (such as a reduction in costs) and entrenchment due to anticompetitive conduct. There is also no mention of metrics that can provide insight into the risks of competitive harm. The only metric proposed by the Agencies, a 30 percent share for defining a dominant firm, was noted to have little economic or legal basis as a screen for anticompetitive conduct. More clarity on the truly novel mechanisms of competitive harm and more robust guidance on implementation would thus be welcome as substantial improvements to Guideline 7.

Guidance on Rebuttal Evidence

Section IV of the DMGs discusses four types of rebuttal evidence that—subject to legal tests established by the courts—may overturn the conclusions from the application of one or more Guidelines: the failing firm defense, the possibility of entry and repositioning by rivals, procompetitive efficiencies, and structural barriers to coordination unique to the industry.

Several commenters considered that the guidance on rebuttal in the DMGs requires some unpacking. Some commenters noted that the DMGs’ organization around 13 standalone Guidelines requires a clearer statement of what rebuttal evidence is permissible in order to overturn the finding of anticompetitive effects for each Guideline. Others emphasized that different Guidelines face different legal tests for rebuttal—for example, structural presumptions may potentially allow for a more limited set of rebuttal evidence. As a possible solution, some commenters suggested bringing back the language of market power (and the reference to higher prices, and reduced quality and innovation) to better clarify what the rebuttal evidence would need to demonstrate.

Some also suggested expanding the types of rebuttal evidence included or, alternatively, clarifying why the Agencies consider that a particular type of evidence tends to be unreliable or lack credibility. Additions proposed in the comments include evidence of sufficient ongoing competition, a weak (flailing) acquired competitor, reputational harms, a showing that a merger would not affect a maverick’s incentive to disrupt coordination (as a specific rebuttal to Guideline 3), or a showing that a merger would not create the incentive to engage in anticompetitive foreclosure (as a specific rebuttal to Guideline 6). There is also a proposal to apply a sliding scale approach to rebuttal—with more rebuttal evidence being required to the extent concerns arising from applying the 13 Guidelines are relatively more serious.

Of all the rebuttal possibilities discussed in the DMGs, the efficiency defense attracted the most attention in comments. Several commenters interpreted the guidance on efficiencies to be tightening the standard of proof for an efficiency to be cognizable and provided contrasting responses.

Some commenters praised the Agencies for taking a tougher stance on efficiencies, noting that courts have been excessively lenient in crediting efficiencies in recent years. Some commenters urged the Agencies to go even further, suggesting that efficiencies cannot be used as a defense when a merger satisfies a presumption for illegality, and encouraged the Agencies to completely excise the discussion of procompetitive efficiencies from the DMGs. Other commenters suggested corrections in the opposite direction and asked the Agencies to acknowledge in clear terms—as the 2010 HMGs did—that mergers can give rise to efficiencies that can serve as rebuttal because they can lead to improved outcomes (price, quality and innovation) for consumers. This position was particularly prominent among hospital groups.

Regardless of the authors’ own skepticism about merger efficiencies, several comments indicated that the current guidance on efficiencies is confusing. Some authors noted that the DMGs begin the discussion of procompetitive efficiencies with a citation to Supreme Court precedent that appears to rule out an efficiency defense, only to almost immediately delve into criteria for cognizability. At the very least, the Agencies’ position on whether and under what conditions an efficiency defense can be used in merger enforcement should be made clearer.

Other commenters suggested revisions to more specific aspects of the discussion to improve its clarity and align it with established economic principles. Some commenters indicated that it would be beneficial to remove language about efficiencies not being cognizable if they “accelerate a trend toward concentration (see Guideline 8) or vertical integration (see Guideline 6),” as this is not economically coherent—for example, technological changes could enable greater economies of scale which would lead to a trend towards consolidation associated with efficiency improvements.

Platforms and Labor Markets

Another innovation relative to prior Guidelines is the inclusion of an extended discussion of the competitive effects of mergers in platforms (Guideline 10) and labor markets (Guideline 11). Both of these Guidelines attracted substantive commentary from supporters and detractors. A common theme, however, was a request for additional clarity and guidance on how the Agencies would address platform and labor issues going forward.

Many applauded the introduction of Guideline 10, exclusively dedicated to mergers involving multisided platforms, given the prominent role that platforms play in the digital economy. Others called for a more careful consideration of the guidance provided, as well as for a more explicit acknowledgement of the role that certain features of platform markets, such as network effects or multi-homing strategies, can play in preserving or increasing competition following a merger.

Several commenters also took issue with Guideline 10’s discussion of a “conflict of interest” as a source of harm from the acquisition of a platform participant by the platform operator. Some of these commenters related this “conflict of interest” to the practice of a retailer self-preferencing its own products (for example a big box retailer giving more prominent in-store placement to its own soft drinks over those of third parties). They noted that self-preferencing is a common practice, often not considered an antitrust violation, which, in some cases, fosters competition within or between platforms. They suggested that the Agencies include an acknowledgement that self-preferencing need not be anticompetitive and explain what evidence would be informative about the risk of anticompetitive self-preferencing post-merger.

Several comments lauded Guideline 11, observing that the monopsony provision and its application to the potential competitive effects of mergers in labor markets is an area previously given “short shrift” by the Agencies. The commenters considered this a helpful innovation, noting, for example, that antitrust protections are intended to extend to workers, not just to consumers, or that monopsony power is pervasive in U.S. labor markets and as harmful as monopoly power. Furthermore, several groups approved the inclusion of consultations with labor organizations and workers as a source of evidence in merger review.

Several other commenters, however, were critical about Guideline 11. For example, some commenters characterized the Guideline as an inappropriate attempt to pursue social policy goals through antitrust enforcement, noting that labor issues are outside of the legal scope of merger enforcement, or expressing skepticism towards the prevalence of monopsony concerns for labor markets. Perhaps not surprisingly, the sentiment towards Guideline 11 often related to whether a comment was voicing the concerns of worker or employer groups.

Commenters also weighed in on the specifics of Guideline 11. For example, several commenters highlighted some of the complexities inherent to defining markets and calculating shares when market boundaries may be hard to define (e.g., labor markets may or may not have clear geographic or industry limits), or when the available prices (i.e., wages) may not adequately reflect the non-monetary aspects of compensation over which many firms compete for workers. Several commenters also pointed out that Guideline 11 should more clearly acknowledge that not every reduction in labor demand is anticompetitive. Economically, there is a difference between eliminating jobs and hurting competition or gaining monopsony power—a firm may have fewer employees post-merger but not have wage-setting power in a market. Additional guidance and clarity from the Agencies on these issues would be welcome.


The Agencies took a bold approach in revising the merger guidelines. This attracted support from many who consider it imperative to have a marked shift in how the Agencies enforce laws prohibiting anticompetitive mergers. However, there were also many commenters who expressed concern about the risks of this approach. They pointed out that if the guidelines lose the focus on and the clarity of the economics, subsequent administrations may retract or substantially revise them. Courts and practitioners may also become reluctant to rely on them. Some of these risks may be mitigated with targeted revisions that would clarify areas of confusion and better align the document with economic principles.