FTC Chairman Khan presents his vision for antitrust law enforcement and consumer protection
Federal Trade Commission (FTC) commissioner Lina Khan testifies during a confirmation hearing of the Senate Commerce, Science and Transportation Committee at Capitol Hill in Washington, DC on April 21, 2021.
Saul Loeb | AFP | Getty Images
Federal Trade Commission President Lina Khan outlined her political priorities and vision in a note to staff dated Wednesday and recently made public.
That’s a snapshot of his goals for the agency, which is overseen by five commissioners who vote on implementation measures and policy statements. The agency enforces antitrust law alongside the Department of Justice’s antitrust division and seeks to protect consumers from unfair business practices and privacy breaches.
Khan described five principles of his plan:
- A “holistic approach to the identification of harms”. Khan said the agency should recognize that workers and independent businesses can be harmed by violations of antitrust and consumer protection laws, in addition to consumers. The popular antitrust framework has focused heavily on consumer harm, often viewed as rising or falling prices, to determine a violation of the law. But Khan has argued in his academic writings for a broader approach that could better assess the damage done by digital platforms, which often charge consumers no or low fees in return for rapid growth.
- Focus on “targeting root causes rather than one-off effects”. Khan said staff should consider how certain business models or conflicts of interest can help companies break the law.
- Integrate more “analytical tools and skills” for more empirical assessments of business practices.
- Be “forward looking” and act quickly to mitigate the damage. Khan said this involved paying special attention to “next generation technologies, innovations and infant industries across sectors.”
- Democratizing the FTC by making sure it is “in tune with the real issues that Americans face in their daily lives.”
Khan then defined three specific policy priorities based on these goals:
- Address consolidation in all sectors revising merger guidelines for companies and deterring transactions that are prima facie illegal and have exceeded commission resources. The agency has seen such an influx of deals that it has started telling some companies to merge at their peril even when it hasn’t finished reviewing their offers.
- Tackle “dominant intermediaries and extractive business models”. Khan wrote that “Business models that centralize control and profits while outsourcing risk, liability and costs also deserve close scrutiny, given that the deeply asymmetric relationships between the controlling firm and dependent entities can be conducive to abuse. “
- Evaluate how contracts can set up methods of unfair competition or deceptive practices. Khan mentioned the non-competition and the remedy restrictions in the memo.
Khan encouraged his staff not to view the agency’s consumer protection and competition divisions as completely separate and to “apply an integrated approach instead.” She also said the agency should expand its “regional footprint” so that some staff will live in areas where its work has an impact and the agency can recruit more diverse talent. She added that the FTC should hire more technologists and experts from different fields to bolster its work.
Khan’s tenure at the FTC has been marked by the enthusiasm of progressives who see her as a new voice for an agency that has been criticized at times for dragging its feet in the app, especially against the tech industry. .
Khan has been among the leading voices for stronger antitrust enforcement and sparked a movement in the field with his 2017 Yale Law Journal article titled “Amazon’s Antitrust Paradox.” The article, which Khan wrote while still a law student, argued that a popular antitrust framework focused on consumer welfare was insufficient to assess dominant tech companies like Amazon.
But his stint at the helm was also marked by strong opposition from the two Republicans on the commission. At the recently open committee meetings, Commissioners Noah Joshua Phillips and Christine Wilson criticized the way public comments are held until the end of voting sessions and expressed the feeling that some votes were rushed before input public.
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