Last week, President Obama issued an Executive Order ostensibly designed to further promote competitive conditions and root out antitrust abuses in industries across the American economy, including the healthcare, energy, and broadband industries which were specifically identified in the Executive Order. Although many commentators have noted that antitrust enforcement by the Department of Justice and the Federal Trade Commission has been particularly vigorous in the last few years,1 companies should note that this Executive Order will likely spur further government oversight and enforcement of the nation’s antitrust laws not only by the Justice Department and the FTC, but also by additional federal agencies.
Titled Steps to Increase Competition and Better Inform Consumers and Workers to Support Continued Growth of the American Economy, the Order requires “all executive departments and agencies with authorities that could be used to enhance competition (“agencies”)” to identify “specific actions” that they can take in their areas of responsibility to build upon efforts to detect abuses such as price fixing, anticompetitive behavior in labor and other input markets, exclusionary conduct, and blocking access to critical resources that are needed for competitive entry. The Order requires the agencies to submit to the Director of the National Economic Council within 30 days a list of agency-specific actions that they have identified. By June 14, 2016, the Director of the National Economic Council will report to the President all of the recommendations on specific actions the agencies will take. Thereafter, the agencies will have an obligation to report semi-annually on any additional actions that they plan to undertake to promote greater competition.
In an April 14th interview about the forthcoming Executive Order, President Obama stated: “Competition is good for consumers. And ultimately it’s good for business. That’s the way the free market works. The more competition we have, the more products, services, innovation takes place.” President Obama went on to reveal that despite the broad scope of the Order, the primary focus is currently much more narrow. In particular, the President seems to be primarily focused on opening up competition for cable set-top boxes. In an accompanying explanatory blog post by Jason Furman, Chairman of the Council of Economic Advisers, and Jeffrey Zients, Director of the National Economic Council and Assistant to the President for Economic Policy, the cable set-top box was referred to as “the mascot” for the new initiative launched by the Executive Order.
Messrs. Furman and Zients went on to say that the agency actions required by the Executive Order will build on the previous pro-competition policies of the Obama administration including the legalization of cell phone unlocking, net neutrality, and a crack down on conflicts of interest in retirement advice. While it is currently uncertain what potential policy recommendations may result from the agencies in response to the Executive Order, the President will clearly be looking for additional governmental policy actions designed to promote competition. The Executive Order instructs agencies to eliminate “regulations that create barriers to or limit competition,” but already there is concern that instead of reducing costs for businesses, the President’s directive may instead result in agencies adding new burdens. Given the likely increase in government oversight and enforcement that will result from the Executive Order, if you have any questions or concerns please contact one of the authors below or your Baker Botts relationship attorney.
1 See Mega deals morph into mega problems for Wall Street, available here; DOJ, FTC Would See Jump In Antitrust Funding In 2017 Budget, available here.