Why FTC Republican Noah Phillips Voted Against Facebook’s Antitrust Lawsuit – tech2.org

Why FTC Republican Noah Phillips Voted Against Facebook’s Antitrust Lawsuit


Noah Phillips, Commissioner of the Federal Trade Commission, testifies during the hearing of the Senate Committee on Commerce, Science and Transportation inclined The invalidation of the EU-US Privacy Shield. And the future of transatlantic data flows, at the Russell Building on Wednesday, Dec. 9, 2020.

Tom Williams | CQ-Roll Call, Inc. | fake images

Noah Phillips, a Republican commissioner with the Federal Trade Commission, explained why he voted against filing the agency’s antitrust lawsuit against Facebook during a hearing before the House antitrust judicial subcommittee on Thursday.

Phillips said he believes the time since Facebook’s acquisitions of Instagram in 2012 and WhatsApp in 2014 presents a roadblock for law enforcement. The FTC reviewed both merger proposals at the time and decided not to block them, allowing Facebook to go ahead with the deals and make the apps an integral part of its own business.

“A large part of this is due to the integrity of the process,” Phillips said, adding that he agrees that the law allows the agency to reassess mergers after they are consummated. “But as a general matter in terms of mergers, the longer you wait, the more investments the company will make.[s]. And I think that presents a real problem. “

The FTC voted 3-2 to present the case in December, and then-Republican President Joe Simons voted with the two Democratic commissioners.

Merger law allows law enforcement agencies to re-evaluate deals. The decision not to block a deal has no influence on future application. But, Phillips testified, the fact that Facebook subsequently invested in Instagram and WhatsApp, around which the lawsuit is centered, presents a practical problem.

Phillips was not a commissioner at the time the FTC evaluated the mergers.

Phillips said he also had some concerns about the merits, including the market definition and effects under Section 2 of the Sherman Antitrust Act, though he did not elaborate.

Still, Phillips said he believes law enforcement officials today are more willing than ever to bring a skeptical lens to merger cases, especially when they involve fledgling competitors.

“We’re a little less concerned about the risks of over-application and a little more concerned about the risks of under-implementation,” Phillips said of mergers with fledgling competitors. “We are hearing the message and we are concerned about this dynamic.”

Subscribe to CNBC on YouTube.

WATCH: How US Antitrust Works And What It Means For Big Tech

.

Source link