FTC Chairman Khan outlines antitrust enforcement, consumer protection approach

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Federal Trade Commission (FTC) commissioner candidate Lina Khan testifies at the Senate Trade, Science and Transportation Commission confirmation hearing on April 21, 2021 in Capitol Hill, Washington, DC.

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Federal Trade Commission Chair Leena Khan set out her policy priorities and vision in a recently published memo to employees on Wednesday.

This is an early overview of its goals for the agency, overseen by five commissioners who vote for enforcement measures and policy statements. The agency, along with the Department of Justice Antitrust, enforces antitrust laws in an effort to protect consumers from unfair business practices and privacy violations.

Kahn outlined five principles of his plan:

  1. “A Holistic Approach to Identifying Damage.” In addition to consumers, Kahn said officials must acknowledge that antitrust and consumer protection violations could harm workers and independent businesses. Popular antitrust frameworks have focused on harming consumers to determine violations of the law, often seen as a rise or fall in prices. However, in academic writing, Kahn discusses a broader approach that can better assess the disadvantages of digital platforms, which often charge consumers free or reduced rates in exchange for rapid growth.
  2. “Focus on targeting the root cause, not the one-sided effect.” Kan said employees should look at how certain business models and conflicts of interest can help companies avoid violating the law.
  3. Integrate more “analytical tools and skill sets” For a more empirical evaluation of business practices.
  4. Be “positive” and act fast to minimize the damage. Kan said it also included a special focus on “next generation technologies, innovations and early industries in the region”.
  5. Democratizing the FTC By ensuring that it is “in line with the real problems Americans face in their daily lives.”

Kan then presented three specific policy priorities based on these goals.

  1. Responding to Inter-industry Integration By revising corporate merger guidelines and blocking transactions where their face is illegal and fees are overwhelming resources. Agencies have seen an influx of transactions, which have started instructing some companies to merge at their own risk, even if the transaction review has not been completed.
  2. Follow the “major middlemen and extraction business model”. “A business model that centralizes management and profits while outsourcing risks, responsibilities and costs is also particularly scrutinized, given that the deeply asymmetric relationships between management companies and subordinate entities may be abused. You can. You have to.”
  3. Evaluate how contracts can establish unfair competition methods and deceptive practices. Kan mentioned non-compete obligations and repair restrictions in its memo.

Kahn did not consider the agency’s consumer protection and competition departments to be completely separate, and encouraged employees to “implement an integrated approach instead”. He also said that agencies should expand their “local footprint” to allow some of their staff members to live in areas where their work affects them and allow them to hire more diverse talent. Is. Rice field. He said the FTC should hire more technicians and professionals from a variety of disciplines to enhance its work.

Khan’s tenure in the FTC has been characterized by the enthusiasm of progressives, who see him as a new voice for institutions that are criticized for their stumbling blocks, especially the tech industry.

Kahn was one of the leading voices in more aggressive antitrust enforcement and took a step in this area in a 2017 Yale Law Journal article, Amazon’s Antitrust Contradiction. This article, written when Kahn was still a law student, wrote that a popular antitrust framework focused on consumer welfare was not enough to evaluate a major tech company like Amazon. claimed to be.

However, his time in power has also been characterized by fierce opposition from the two Republicans on the commission. At the commission’s new meeting, commissioners Noah Joshua Phillips and Kristen Wilson criticized how public comments were made with few votes ahead of public opinion by the end of the voting session. He expressed his feelings of being in a hurry.

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