On November 4, 2021, Justine Reisler and Robin Spillette attended the Global Competition Review’s annual Women in Antitrust conference in Washington, D.C. The event featured an incredible lineup of female lawyers and economists on panels addressing some of the most cutting-edge topics in antitrust today, namely: (i) assessing deal risk in a time of changing standards, (ii) approaches being taken by competition agencies to address global concerns about Big Tech, (iii) sustainable economic development, and (iv) innovation in the pharmaceutical sector.

One major theme that cut across all of the topics discussed was the importance of remaining focused on first principles. The keynote speaker set out in her speech five core principles of antitrust which have historically been considered (by most) axiomatic and discussed how these underlying principles are being threatened by some of the more radical reform proposals being debated. These principles include that: (i) competition law should protect the competitive process, rather than competitors; (ii) competition law should not be based on non-economic factors; (iii) enforcement agencies should not favour (or scrutinize) certain market participants over others on the basis of identity and that rather, all enforcement actions must be based on sound economic evidence; (iv) due process matters; and (v) remedies must be based on sound economic principles and be related to the economic harm identified.

Uncertainty in the face of changing standards

Panelists discussed the difficulty of assessing deal risk in a time of changing standards. In the United States, antitrust lawyers are grappling with how to interpret the Federal Trade Commission’s (“FTC”) new Pre-Consummation Warning Letters, the FTC and the Department of Justice’s (“DOJ”) temporary suspension of early termination grants, President Biden’s new Executive Order on Promoting Competition in the American Economy, the withdrawal of the 1995 policy statement on prior approval and prior notice which limited the FTC’s ability to require that parties which proposed an unlawful merger receive prior approval and give prior notice of certain future transactions, and the new and then subsequently withdrawn Vertical Merger Guidelines, among other causes of uncertainty. Both the Pre-Consummation Warning Letters and the suspension of early termination grants were flagged as being troubling from a resource allocation perspective, as the panelist noted that each of these actions wastes resources on non-problematic mergers, rather than allowing the agencies to triage mergers quickly and to focus resources on mergers which may create real antitrust concerns. The new Executive Order (which calls on various non-competition agencies to promote competition) also raised concern in this respect, as the panelists noted that it is questionable what real effect non-competition agencies could have on the promotion and enforcement of competition.

In Europe, competition lawyers are adapting to the European Commission’s new approach to the referral mechanism set out in Article 22 of the EU Merger Regulation 139/2004, whereby it will now encourage referrals from Member States even where the national filing thresholds are not met, reducing legal certainty for merging parties. In Canada, discussions regarding reform to the Competition Act are just beginning – but we know that the Canadian Competition Bureau is looking to US antitrust agencies for guidance in any new reforms. Moreover, non-traditional concerns, such as the impact of a transaction on labour markets, are already part of the discussion in Canada.

Different Approaches being taken to address global concerns about Big Tech

Panelists discussed the myriad of policy and legislative reform proposals directed at reigning in the alleged anticompetitive conduct of a small number of predominantly US technology companies. It was observed that much of the policy change momentum was being driven from Europe. However, the push to regulate multinational technology companies has become global, and is now being taken up by competition authorities in emerging markets as well. For example, new legislation in Russia has been proposed to reign in large digital platforms, which was in fact inspired by German initiatives in this area. Further, the U.K.’s Competition and Markets Authority, post Brexit, was observed to be taking a much more active role and aggressive enforcement approach, with respective to its position on both substance and jurisdiction. While the panelists noted that some level of convergence in approach by jurisdictions is expected (due to the fact that most jurisdictions are facing similar issues), they also noted that the various new enforcement regimes would nonetheless likely create difficulty for large, multinational companies attempting to keep up with and comply with quickly evolving regulatory regimes in multiple jurisdictions. The panelists noted companies want to follow the laws; however, laws must be clear and understandable in order for them to do so. Picking up on the themes from the keynote speech, panelists noted the necessity of remaining anchored in competition law principles and avoiding a return to “big is bad” in relation to the policing of large tech companies. The panelists also noted concern with respect to regulatory agencies’ ability to properly analyse and understand dynamic competition in the in the tech industry.

Sustainable Economic Development

One key takeaway is that sustainable development is about a lot more than just the environment. It is about using resources in a way that leaves enough for future generations, and it is also about an inclusive and equitable approach to economic development, including competition policy. Panelists discussed how competition policy can be used to support environmental, social and governance (“ESG”) agendas and how far companies can go on cooperating on sustainability initiatives without violating cartel laws. There was international interest in the Competition Bureau’s work on gender inclusive competition law, and its consideration of gendered effects in case selection and analysis. Panelists also discussed the European Green Deal, which is a set of policy initiatives by the European Commission with the overarching aim of making Europe climate neutral by 2050, and ensuring that the transition is fair for all. Commissioner Vestager made clear that competition policy will have a role to play in implementing the European Green Deal. Panelists noted that taking into account all sustainability goals in competition analysis would change the anticompetitive standard, and possibly not for the better. However, it was noted that consumers are aware of sustainability benefits and are willing to pay for them. It is that aspect of sustainability that panelists suggest competition agencies should take into account in their analysis of competitive effects.

Innovation in the Pharmaceutical Sector

Panelists discussed how innovation is at the forefront of antitrust enforcement, and the increased scrutiny of the pharmaceutical sector generally. In particular, they discussed the FTC’s multilateral working group to build a new approach to pharmaceutical mergers. The working group is, among other things, considering new theories of harm and remedies. Panelists discussed where to draw the line between what sort of innovation effects regulators are well placed to assess and the sort that they are not. Concerns were expressed regarding competition authorities’ consideration of competitive effects arising from products that remain in the very early stages of research and development, as their likelihood of ultimately being marketed becomes far more speculative. It was noted that the pharmaceutical sector is rife with litigation in the United States, with reverse payments cases, price-fixing cases, and product hopping cases, among others. However, despite increased scrutiny of pharmaceutical mergers, panelists are of the view that regulatory risk is not going to dissuade deal activity in this area. Factors such as low interest rates are said to be a more significant driver than regulatory considerations. However, panelists noted that increased scrutiny may have some impact on the margins. For example, it may encourage companies looking for a buyer to favour investment firms with no competitive overlap over strategic buyers.