Klobuchar Pushes Broad Antitrust Revamp As Hawley Targets Tech

Lawmakers on both sides of the aisle took a swipe at overhauling antitrust laws Thursday with disparate tactics for regulating large technology companies that offer a narrow window for bipartisan compromise on the issue.

Sen. Amy Klobuchar (D-Minn.) introduced broad antitrust reform legislation that would beef up enforcement and revamp underlying antitrust laws. The bill stands in contrast to a largely symbolic proposal to ban mergers by big technology companies like Amazon.com Inc. and Alphabet Inc.‘s Google, which Sen. Josh Hawley (R-Mo.) offered unsuccessfully as an amendment to Senate Democrat’s budget resolution.

The new chair of the Senate Judiciary’s antitrust subcommittee released her legislation with Democratic colleagues on Thursday as a combination of legislation from the past several years to rework antitrust at the federal level. Klobuchar’s measure would increase enforcement funding for the Justice Department’s Antitrust Division and the Federal Trade Commission, while changing underlying antitrust laws to make it easier to bring lawsuits.

Klobuchar Pitches Antitrust Reform for ‘Too Big to Fix’ Mergers

Hawley, a vocal critic of big tech companies, offered his amendment to Democrats’ budget resolution (S. Con. Res. 5), seeking to prohibit mergers and acquisitions by companies that operate “market dominant” online platforms. The amendment was offered via a largely symbolic procedure that, even if adopted, would have served only as a placeholder for real legislation to come later. The Senate ultimately didn’t vote on Hawley’s amendment, despite his call for colleagues on Thursday to end Amazon and Google’s “predatory practices.”

Klobuchar has said she sees bipartisan concern about the power of technology companies.

Photographer: Andrew Harnik/AP Photo/Bloomberg

‘Different Degrees of Seriousness’

Hawley’s efforts were seen in technology policy circles as more political theater than policymaking.

“I think Klobuchar’s bill is a really serious effort and Hawley’s amendment might have some appeal on the surface to some people, but not only do I think the process he’s using to get it out there is less serious, but that the focus is wrong,” Matt Wood, vice president of policy and general counsel at Free Press, a nonprofit media advocacy group, said in an interview. “It should be on corporate concentration and power, not any one particular sub sector.”

Matt Schruers, president of the tech trade group CCIA, said Klobuchar and Hawley’s measures approach antitrust with “different degrees of seriousness.” Schruers said “any legislation that unnecessarily limits acquisitions in the tech sector would threaten investment in an industry that has played a valuable role in sustaining our economy amid the pandemic.”

Hawley’s office did not respond to a request for comment.

Klobuchar’s legislation would have dramatic effects on companies and federal agencies like DOJ and FTC, Haidee Schwartz, a partner at Akin Gump Strauss Hauer & Feld LLP and previously acting deputy director at the FTC’s Bureau of Competition, said in an interview. The measure would make it easier to bring and potentially win antitrust monopolization claims, Schwartz said.

Klobuchar’s bill would strengthen the Clayton Antitrust Act of 1914, which sought to prohibit anticompetitive mergers. It also seeks to change the legal standard for permissible mergers in all sectors, not just the technology space, and would require merging parties to provide the burden of proof that the merger won’t violate the law.

Schwartz said the bill’s proposed funding increases for DOJ’s Antitrust Division and FTC “would be a game changer for U.S. antitrust enforcement.”

Bipartisan Interest in Antitrust Reform

Despite Hawley’s unsuccessful effort, his interest in the topic may indicate there is room for bipartisan compromise to overhaul antitrust enforcement and he is also a member of the antitrust subcommittee. Klobuchar’s bill has greater odds of making it to the Senate floor now that Democrats control the chamber. But Democrats would still need Republicans to sign onto the measure to reach the 60 vote threshold needed to advance a bill to a final vote.

There is growing bipartisan interest in antitrust reform, Michael Kades, director of markets and competition policy at the nonprofit Washington Center Equitable Growth and former counsel for Klobuchar on the antitrust subcommittee, said in an interview.

“I actually think the Hawley amendment is using the same type of legislative modification that Klobuchar is using,” Kades said. He said both measures are seeking to change the burden of proof, requiring companies to demonstrate the merger doesn’t violate the law.

“That might be an area where there may be some growing bipartisan understanding that this is a way to change the law,” Kades said.

Sen. Mike Lee (R-Utah), the top Republican on the antitrust subcommittee, looks forward to “working on improving antitrust enforcement” with Klobuchar, a Lee spokesman said.

But Lee wants to focus on more tailed reform measures first, and plans to reintroduce the One Agency Act, which seeks to combine all antitrust enforcement into the DOJ.

“Sen. Lee believes we should make sure the current laws are being adequately and appropriately enforced before we make sweeping substantive revisions to legal standards,” the spokesman said.