Washington, D.C. – The Federal Trade Commission (FTC) and Department of Justice (DOJ) released today its final version for new merger enforcement guidelines. The final guidelines include substantial revisions to the existing standards, introducing new considerations for mergers that enhance buyer power. In a significant shift, the guidelines issued today strongly consider how buyer power impacts competition amongst rival firms and trading partners, a major contrast to the current guidelines that largely ignore how buyer power abuses impact competition.
These updates signify a notable departure in merger enforcement, reflecting an effort to address concerns raised by the National Grocers Association (NGA) with federal enforcers. In September 2023 comments submitted to the FTC and DOJ on the proposed guidelines, the NGA emphasized the need for agencies to scrutinize how dominant firms utilize their bargaining leverage to impose discriminatory terms on their rivals. NGA highlighted the substantial advantage enjoyed by dominant food retailers, who can exert pressure on grocery suppliers to secure more favorable terms, encompassing pricing, promotions, payment terms, and product availability.
“Following decades of consolidation, the current grocery landscape is dominated by a few national chains who wield so much economic influence they can undercut competitors simply by demanding preferable treatment from suppliers. This pattern has resulted in anticompetitive economic discrimination against independent grocers and their customer base,” said Chris Jones, Senior Vice President of Government Relations and Counsel at NGA. “The revised Merger Guidelines released today signifies a major course correction in antitrust enforcement that recognizes the competitive dangers of buyer power.”
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