As we approach the inauguration of Donald Trump as the 45th President of the United States, a number of questions remain about the implications of the new administration for US antitrust enforcement and policy. Although there has been speculation that the Trump Administration will pursue an unprecedented and unpredictable antitrust agenda, we believe that the new administration is more likely to promote traditional conservative principles and largely resemble prior Republican Administrations with respect to antitrust. We already have seen key appointments to the President-elect’s transition team for antitrust that suggest the new leadership at the US antitrust agencies, who ultimately will be responsible for implementing the administration’s antitrust policies, will consist of experienced antitrust practitioners, economists and academics. We expect that the administration will announce nominations for key positions at the antitrust agencies over the next few months. Once nominations have been made, we will provide additional information and insight on the specific individuals and their likely antitrust posture. In the meantime, we offer the following preliminary insight.

What to expect over the next several weeks?

The transition team’s task is to facilitate a smooth transition of power following Trump’s inauguration on January 20, 2017. The transition team is led by Vice President-elect Mike Pence, and senior members of the team consist of several longtime Republican-elected officials, policy experts and advisers, including members of previous Republican administrations. Joshua Wright, a professor at the Antonin Scalia Law School at George Mason University and a former Commissioner of the Federal Trade Commission (FTC), has been tapped to lead the transition team’s focus on antitrust law and policy, and his responsibilities will include developing plans for the FTC and potentially also the Department of Justice’s Antitrust Division (Antitrust Division). David Higbee, an antitrust practitioner and former official in the Antitrust Division during the George W. Bush Administration, is also a member of the transition team.

Over the next several weeks, the transition team will prepare reports on each federal agency, recommend Cabinet and agency appointments – including for the positions of Assistant Attorney General of the Antitrust Division and Commissioners (including the Chairman) of the FTC – and draft the new administration’s policy priorities. These responsibilities include compiling a list of candidates, conducting interviews and preparing recommendations for appointments to the positions of Assistant Attorney General of the Antitrust Division and FTC Commissioners. President-elect Trump will have the opportunity to fill two Republican seats at the FTC – the Chairman and a Commissioner. The President-elect likely will choose to elevate Commissioner Maureen Ohlhausen, the current lone Republican Commissioner, to acting Chairman after the inauguration to run the FTC until the US Senate confirms Trump’s nominees. President-elect Trump also could elevate Commissioner Ohlhausen to serve in a more permanent capacity as Chairman (which would not require additional Senate confirmation), in which case Trump would still select two Republican Commissioners. The President-elect also will need to fill one additional vacancy if the current head of the agency resigns. The Senate Democratic leadership typically would recommend an individual for this vacancy.

We anticipate that antitrust appointments will be announced at end of 2016 or in early 2017. Each top position will require Senate confirmation (unless Commissioner Ohlhausen is elevated to Chairman), which may be hastened by the fact that Republicans control the Senate. New leadership at the Antitrust Division and FTC therefore could be in place as early as late February. However, given the competing demands of other pending appointments (including a Supreme Court nomination) and what has been reported as a slow start to the transition process, it is likely that positions will not be filled until the spring. This is consistent with past practice. For instance, for the last three presidential administrations, it took 90–150 days to confirm the first Assistant Attorney General for the Antitrust Division.

What approach will a Trump Administration bring to antitrust law and policy?

President-elect Trump does not fit the typical conservative Republican mold, particularly on economic regulatory issues, so predicting his approach is more uncertain than with previous Republican presidents. We expect, however, that if the President-elect follows the recommendation of his transition team, the appointees to the Antitrust Division and FTC will be more traditional conservatives with significant antitrust law and policy experience. Directionally, therefore, Trump’s appointees likely will adopt a more lenient antitrust enforcement posture than Obama’s appointees, but the magnitude of change and how it will be implemented are more uncertain. The transition team’s announcements of antitrust leadership appointments will give us a better understanding of the Trump Administration’s likely antitrust enforcement posture and priorities. In light of former Commissioner Wright’s involvement, we believe that the candidates for these appointments likely will have less interventionist postures than the current Obama Administration leadership. It also is likely, based on former Commissioner Wright’s focus on economics, that in addition to nominating antitrust practitioners and academics, the President-elect will nominate one or more economists to leadership roles.

How could Trump’s political philosophy influence antitrust enforcement?

President-elect Trump sounded themes of populism and protectionism during his presidential campaign, which diverge significantly from traditional Republican laissez-faire policies, and may influence decisions related to antitrust enforcement in certain specific cases. In fact, during the campaign, Trump made populist references regarding the appropriate application of the antitrust laws to matters specifically involving media and high tech industries. However, since the election, Trump has backed down from some of his campaign rhetoric, and there have been reports of the transition team ensuring parties, like AT&T and Time Warner, that their transaction will not be scrutinized with prejudice. If the Trump Administration takes an approach different from the more traditional limited government and pro-business approach taken by prior Republican administrations, it likely will be in the context of large and high profile transactions or companies that sell products directly consumed by end customers. In contrast, intermediate industrial and other inputs are unlikely to be the targets of populist-inspired enforcement. The Trump Administration populism also could lead to challenges of transactions in which the acquiring party intends to close manufacturing facilities in the United States. Finally, although the Trump Administration has advocated for foreign investment in the United States, and thus likely will not be more hostile to European acquirers of US businesses, it is possible that Chinese and Middle East acquirers may receive closer scrutiny if their proposed transactions implicate national security.

What are a Trump Administration’s potential antitrust targets?

Many have speculated about which of his political enemies Trump will attack once in office, based on his comments over the course of his presidential campaign. Candidate Trump took aim at the media industry, suggesting that he would pursue antitrust enforcement against companies seeking to make deals in the sector. For example, Trump stated that Jeff Bezos used The Washington Post to attack him in an effort to avoid a lawsuit against Amazon over “monopolistic tendencies” that have led to the destruction of department stores and the retail industry. In addition, Trump denounced the AT&T/Time Warner transaction, describing the tie-up as “an example of the power structure I’m fighting ... [and] a deal we will not approve in my administration because it’s too much concentration of power in the hands of too few.” More unconventional picks for appointment to the Antitrust Division and FTC may support this form of “big is bad” analysis. As noted above, however, Trump’s antitrust appointees likely will take a more measured and traditional conservative approach to antitrust enforcement.

How will the transition impact DOJ and FTC investigative resources?

President-elect Trump also has announced his intention to impose a hiring freeze on all federal agencies after his inauguration. In light of current cases and resources, this could reduce the US antitrust agencies’ willingness to take on marginal investigations and enforcement actions in the near term. In addition, we ordinarily observe a standard decline in enforcement during and immediately after every Presidential transition – particularly with a change in political party – as appointees are more focused on policy and organizational matters than on particular cases. Thus, the Antitrust Division and FTC may be less likely to pursue enforcement on marginal cases over the next six to seven months.

What changes do we expect for antitrust enforcement by the states?

Most states have offices under their State Attorneys General that focus on antitrust and consumer protection issues. Although many states primarily work together with other states and the federal enforcement agencies to bring antitrust cases, a few states have robust offices and bring merger and conduct cases unilaterally. A number of these offices are in states that tend to vote for Democrats (e.g. California, New York) and therefore could be expected to have a more interventionist State Attorney General. If there is a reduction in federal antitrust enforcement during the Trump Administration, we may see an increase in the number of antitrust investigations and lawsuits pursued by certain State Attorneys General.