Merger Remedies: Behavioral vs. Structural Solutions

November 17, 2014

Mergers are challenged by the federal government—either the Department of Justice or the Federal Trade Commission—when the government believes the transaction may substantially lessen competition. Should the government consider a merger anticompetitive, it will seek whatever remedy, through consent decree with the parties or filing suit to enjoin a merger, it deems necessary. The outcomes of a merger investigation can be viewed on a spectrum. On one end, the government wholly blocks the transaction; on the other end, the government allows consummation of the deal free and clear of conditions and encumbrances. The remedy the government may seek is case dependent and fact-specific and the "touchstone principle for the [DOJ] in analyzing remedies is that a successful merger remedy must effectively preserve competition in the relevant market. That is the appropriate goal of merger enforcement."

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