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<img class="alignright size-medium wp-image-1691" src="https://antitrustadvocate.bakerhostetlerblogs.com/wp-content/uploads/sites/14/2016/04/White-House-300x200.jpg" alt="" width="300" height="200" />President Trump’s head of the Department of Justice’s Antitrust Division, Makan Delrahim, recently explained that the division will cut back on behavioral commitments such as consent orders regulating conduct and will instead rely more on structural changes such as divestitures to remedy merger concerns. This could signal significant changes in how the DOJ resolves concerns with proposed mergers going forward.



In one of his first <a href="https://www.justice.gov/opa/speech/assistant-attorney-general-makan-delrahim-delivers-keynote-address-american-bar">remarks</a> on antitrust policy since his confirmation, Assistant Attorney General Delrahim delivered a speech on November 16 regarding the relationship between antitrust enforcement and the Trump administration’s focus on limiting government regulation of business. Delrahim explained on a theoretical level that effective antitrust enforcement lessens the need for market regulations and that behavioral commitments – often consent orders that regulate the post-merger conduct of parties – represent government oversight on what preferably should be a free market. He also identified several practical problems with behavioral commitments:
<ul>
 	<li>They are difficult to structure, especially their length, because short remedies may be mere “Band-Aids” and long remedies may become obsolete (Delrahim referenced a judgment regulating the Horseshoers Association that is still in effect).</li>
 	<li>They are hard to oversee, as they may require monitoring the granular, day-to-day operations of businesses to assess compliance.</li>
 	<li>They are challenging to enforce because the DOJ often lacks the resources to do so effectively.</li>
</ul>
Emphasizing that behavioral remedies should be viewed with skepticism for these and other reasons, Delrahim stated that the DOJ will instead focus on structural remedies to remedy merger concerns. He supported this pronouncement with reference to the DOJ’s 2004 Remedies Guidelines that stated conduct remedies generally are not favored in merger cases. (No reference was made to the DOJ’s 2011 guidelines that state conduct remedies can be an effective method of dealing with competition concerns.)

While expressing preference for structural remedies, Delrahim left open the possibility of the DOJ accepting some behavioral commitments. He explained that behavioral remedies should avoid taking pricing decisions away from markets, and should be simple and administrable by the DOJ. He further explained that such remedies must “completely cure the anticompetitive harms.” He said the DOJ would accept these remedies only when it has a “high degree of confidence that the remedy does not usurp regulatory functions for law enforcement.” Overall, convincing the DOJ to accept behavioral remedies will be a “high standard to meet,” according to Delrahim.

Delrahim’s explanation of the DOJ’s present regard for behavioral commitments may signal changes in how the DOJ resolves concerns with proposed mergers. In recent years, the DOJ accepted behavioral remedies to resolve competitive concerns in several high-profile deals, with the 2011 joint venture among Comcast and NBC Universal, the 2011 acquisition of ITA Software by Google, and the 2010 TicketMaster/Live Nation merger among the most notable. But Delrahim’s speech suggests that the Trump administration DOJ would not have accepted these remedies. How much, if at all, the DOJ changes its approach to resolving competitive concerns will be seen as it considers pending mergers in the coming months.

The Trump DOJ’s View on Merger Enforcement and Remedies Explained