June 13, 2017

June 12, 2017

Subscribe to Latest Legal News and Analysis

The LATEST: FTC “Second Requests” to be Narrower in Scope under Ohlhausen’s Leadership

Transactions that meet the Hart-Scott-Rodino thresholds for notification must be reported to the Federal Trade Commission (“FTC”) and Department of Justice. Where a notified transaction raises competition concerns, the reviewing agency may decide to launch an in-depth investigation and request additional information from the merging parties, known as a “Second Request,” which can take several months and cost companies millions of dollars to fully respond. Under FTC Acting Chairwoman Maureen Ohlhausen’s leadership, however, the burden of a Second Request may decrease, as she intends to narrow their scope.

What Happened:

  • Acting Chairwoman Ohlhausen has signaled that Second Requests will be more limited under her leadership, based on comments made on February 15, 2017 at a Washington conference.

  • The standard for initiating a Second Request will not change. However, once initiated, Second Requests will be narrower in scope, in terms of markets assessed and data requested from companies.

What this Means:

  • The standard used by the FTC to initiate such investigations will not change; thus, complex transactions raising competition concerns will likely still face a Second Request.

  • However, the time and cost associated with complying with a Second Request may be reduced, which will be good news for companies who may face a shorter review at a lower cost.

  • This business-friendly approach is consistent with Commissioner Ohlhausen’s guiding principles of “regulatory humility, […] the power of competitive markets, and a devotion to empiricism” and her objective to “minimiz[e] the burdens on legitimate businesses”. As such, it may be one of further changes to come in FTC enforcement.

Statement of Acting FTC Chairman Ohlhausen on Appointment by President Trump.

© 2017 McDermott Will & Emery

TRENDING LEGAL ANALYSIS


About this Author

Andrea Hamilton, McDermott Law Firm, Antitrust Attorney
Partner

Andrea Hamilton is a partner in the law firm of McDermott Will & Emery LLP based in its Brussels office.  She is a member of the Antitrust and Competition Practice Group.  Formerly based in the Firm’s Washington DC office, Andrea focuses her practice on mergers, acquisitions, government investigations, and complex antitrust litigation, with significant experience in life sciences, high tech, pharmaceuticals, defence, consumer products, health care and chemicals industries.

32 2 282 35 15
Jon B. Dubrow, Corporate Lawyer, Mergers and Acquisitions Attorney, McDermott Law
Partner

Jon B. Dubrow is a partner in the law firm of McDermott Will & Emery LLP and is based in the Firm's Washington, D.C. office.  He focuses his practice on defending mergers, acquisitions and joint ventures before the Department of Justice, the Federal Trade Commission and foreign competition authorities, as well as antitrust and commercial litigation.  Jon also provides counseling on distribution issues and a wide variety of other competition-related matters.

202-756-8122
Gregory E. Heltzer, Mergers and Acquisitions Lawyer, Antitrust Attorney, McDermott Will Emery, Law Firm
Partner

Gregory E. Heltzer is a partner in the law firm of McDermott Will & Emery LLP and is based in the Firm's Washington, D.C., office.  He focuses his practice on defending mergers and acquisitions before the Federal Trade Commission, Department of Justice, state antitrust authorities and foreign competition authorities.  In addition, his practice also includes complex antitrust litigation, government investigations and antitrust counseling (e.g., advising agricultural cooperatives on the requirements of the Capper Volstead Act).

202-756-8178