| Entities | |
| Topics and Issues | Antitrust (3) Competition (2) |
In November 2022, the FTC announced a Policy Statement Regarding the Scope of Unfair Methods of Competition Under Section 5 of the Federal Trade Commission Act. This statement (Commission File No. P221202), according to the Commission’s press release
restores the agency’s policy of rigorously enforcing the federal ban on unfair methods of competition. Congress gave the FTC the unique authority to identify and police against these practices, beyond what the other antitrust statutes cover. But in recent years the agency has not always carried out that responsibility consistently. The FTC’s previous policy restricted its oversight to a narrower set of circumstances, making it harder for the agency to challenge the full array of anticompetitive behavior in the market. Today’s statement removes this restriction and declares the agency’s intent to exercise its full statutory authority against companies that use unfair tactics to gain an advantage instead of competing on the merits.
The new Policy Statement, adopted on a 3-1 vote, replaces an FTC statement from 2015. That statement declared that the FTC “would apply Section 5 using the Sherman Act ‘rule of reason’ test, which asks whether a given restraint of trade is ‘reasonable’ in economic terms. The new statement replaces that [2015] policy and explains that limiting Section 5 to the rule of reason contradicted the text of the statute and Congress’s clear desire for it to go beyond the Sherman Act. And it shows how the Commission will police the boundary between fair and unfair competition through both enforcement and rulemaking. The statement makes clear that the agency is committed to protecting markets and keeping up with the evolving nature of anticompetitive behavior.
Voting against the adoption of the Policy Statement was the lone Republican commissioner, Christine S. Wilson. Led by Chair Khan, the other two Democratic commissioners issued a joint statement. Commissioner Bedoya, joined by Chair Khan and Commissioner Slaughter, issued a statement. Commissioner Wilson issued a dissenting statement.