FTC To Study Acquisition History Of Five Tech Majors

The Federal Trade Commission or FTC has ordered five major technology firms to hand over details about their previous acquisitions not reported to the antitrust agencies, for study purpose. The special orders were given to Alphabet Inc., including Google, as well as Amazon.com, Inc., Apple Inc., Facebook, Inc., and Microsoft Corp.

The Commission aims to understand large technology firms’ acquisition activity, and study about how these firms report their deals to the federal antitrust agencies.

The orders were given under the FTC act, which authorizes the Commission to conduct wide-ranging studies that do not have a specific law enforcement purpose.

In a statement, the Commission urged these companies to provide information and documents on the terms, scope, structure, and purpose of transactions consummated between January 1, 2010 and December 31, 2019.

They are required to identify acquisitions that were not reported to the FTC and the U.S. Department of Justice under the Hart-Scott-Rodino or HSR Act, and to provide related information.

The FTC will also check whether these companies are making potentially anticompetitive acquisitions of nascent or potential competitors.

The Commission also seeks details about their corporate acquisition strategies, voting and board appointment agreements, agreements to hire key personnel from other companies, and post-employment covenants not to compete.

Further, information related to post-acquisition product development and pricing also need to be handed over. The Commission also seeks to learn more about how small firms perform after they are acquired by large technology firms.

With the details, the Commission would examine trends in acquisitions and the structure of deals, including whether acquisitions not subject to HSR notification might have raised competitive concerns.

The study is part of the follow-up from the FTC’s 2018 Hearings on Competition and Consumer Protection in the 21st Century.

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