[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[S. 1812 Introduced in Senate (IS)]

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115th CONGRESS
  1st Session
                                S. 1812

    To amend the Clayton Act to modify the standard for an unlawful 
                  acquisition, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 14, 2017

 Ms. Klobuchar (for herself, Mrs. Gillibrand, Mr. Blumenthal, and Mr. 
    Markey) introduced the following bill; which was read twice and 
               referred to the Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
    To amend the Clayton Act to modify the standard for an unlawful 
                  acquisition, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Consolidation Prevention and 
Competition Promotion Act of 2017''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) competitive markets are critical to ensuring 
        opportunity for all people in the United States;
            (2) when companies compete, businesses offer the highest 
        quality and choice of goods for the lowest possible prices to 
        consumers and other businesses;
            (3) competition fosters small business growth, reduces 
        economic inequality, and spurs innovation;
            (4) concentration that leads to market power and 
        anticompetitive conduct makes it more difficult for people in 
        the United States to start their own businesses, depresses 
        wages, and increases economic inequality;
            (5) undue market concentration also contributes to the 
        consolidation of political power, undermining the health of 
        democracy in the United States;
            (6) the anticompetitive effects of market power created by 
        concentration include higher prices, lower quality, 
        significantly less choice, reduced innovation, foreclosure of 
        competitors, increased entry barriers, and monopsony power;
            (7) monopsony power--
                    (A) allows a firm to force suppliers of goods or 
                services to cut their prices to unreasonably low 
                levels, resulting in reduced business opportunities for 
                suppliers and reduced availability and quality of 
                products and services for consumers; and
                    (B) can result in workers being forced to accept 
                unreasonably low wages;
            (8) horizontal consolidation, vertical consolidation, and 
        conglomerate mergers all have potential to cause 
        anticompetitive harm;
            (9) unprecedented consolidation is reducing competition and 
        threatens to place the American dream further out of reach for 
        many consumers in the United States;
            (10) since 2008, firms in the United States have engaged in 
        over $10,000,000,000,000 in mergers and acquisitions;
            (11) between 2010 and 2015, there was a 50-percent increase 
        in the number of mergers and acquisitions reviewed by the 
        Federal Trade Commission and the Antitrust Division of the 
        Department of Justice;
            (12) the antitrust laws, particularly section 7 of the 
        Clayton Act (15 U.S.C. 18), are the first line of defense 
        against anticompetitive mergers; and
            (13) in recent years, some court decisions and enforcement 
        policies have limited the vitality of the Clayton Act to 
        prevent harmful consolidation by--
                    (A) discounting previously accepted presumptions 
                that certain acquisitions are anticompetitive;
                    (B) focusing inordinately on the impact on price of 
                an acquisition in the short term;
                    (C) underestimating the dangers that horizontal, 
                vertical, and conglomerate mergers will lower quality, 
                reduce choice, impede innovation, exclude competitors, 
                increase entry barriers, or create monopsony power; and
                    (D) requiring the government to prove harmful 
                effects of a merger to a near certainty.
    (b) Purposes.--The purposes of this Act are to promote competition 
and prevent harmful consolidation by restoring the original intent of 
the Clayton Act to address the full range of anticompetitive harms, 
including--
            (1) eliminating the requirement that a merger 
        ``substantially'' lessens competition to clarify that the 
        Clayton Act prohibits mergers that, as a result of 
        consolidation, may materially lower quality, reduce choice, 
        reduce innovation, exclude competitors, increase entry 
        barriers, or increase price;
            (2) inserting the phrase ``materially'' to establish that 
        the plaintiff need not show an acquisition may cause a 
        substantial amount of harm to competition, but rather show that 
        an acquisition may cause more than a de minimis amount of harm 
        to competition;
            (3) amending the Clayton Act to include the term 
        ``monopsony'' to clarify that an acquisition that tends to 
        create a monopsony violates the Clayton Act; and
            (4) establishing simple, cost-effective decision rules that 
        require the parties to certain acquisitions that either 
        significantly increase consolidation or are extremely large 
        bear the burden of establishing that the acquisition will not 
        materially harm competition.

SEC. 3. UNLAWFUL ACQUISITIONS.

    Section 7 of the Clayton Act (15 U.S.C. 18) is amended--
            (1) in the first and second undesignated paragraphs, by 
        striking ``substantially'' each place that term appears and 
        inserting ``materially'';
            (2) by inserting ``or a monopsony'' after ``monopoly'' each 
        place that term appears; and
            (3) by adding at the end the following:
    ``In a case brought by the United States, the Federal Trade 
Commission, or a State attorney general, a court shall determine that 
the effect of an acquisition described in this section may be 
materially to lessen competition or create a monopoly or a monopsony 
if--
            ``(1) the acquisition would lead to a significant increase 
        in market concentration in any line of commerce or in any 
        activity affecting commerce in any section of the country; or
            ``(2)(A) the acquisition is not a transaction that is 
        described in section 7A(c); and
            ``(B)(i) as a result of such acquisition, the acquiring 
        person would hold an aggregate total amount of the voting 
        securities and assets of the acquired person in excess of 
        $5,000,000,000 (as adjusted and published for each fiscal year 
        beginning after September 30, 2018, in the same manner as 
        provided in section 8(a)(5) to reflect the percentage change in 
        the gross national product for such fiscal year compared to the 
        gross national product for the year ending September 30, 2017); 
        or
            ``(ii)(I) the person acquiring or the person being acquired 
        has assets, net annual sales, or a market capitalization 
        greater than $100,000,000,000 (as so adjusted and published); 
        and
            ``(II) as a result of such acquisition, the acquiring 
        person would hold an aggregate total amount of the voting 
        securities and assets of the acquired person in excess of 
        $50,000,000 (as so adjusted and published),
unless the acquiring and acquired person establish, by a preponderance 
of the evidence, that the effect of the acquisition will not be to tend 
to materially lessen competition or tend to create a monopoly or a 
monopsony. In this paragraph, the term `materially lessen competition' 
means more than a de minimis amount.''.

SEC. 4. POST-SETTLEMENT DATA.

    Section 7A of the Clayton Act (15 U.S.C. 18a) is amended by adding 
at the end the following:
    ``(l)(1) Each person who enters into an agreement with the Federal 
Trade Commission or the United States to resolve a proceeding brought 
under the antitrust laws or under the Federal Trade Commission Act (15 
U.S.C. 41 et seq.) regarding an acquisition with respect to which 
notification is required under this section shall, on an annual basis 
during the 5-year period beginning on the date on which the agreement 
is entered into, submit to the Federal Trade Commission or the 
Assistant Attorney General, as applicable, information sufficient for 
the Federal Trade Commission or the United States, as applicable, to 
assess the competitive impact of the acquisition, including--
            ``(A) the pricing, availability, and quality of any product 
        or service, or inputs thereto, in any market, that was covered 
        by the agreement;
            ``(B) the source, and the resulting magnitude and extent, 
        of any cost-saving efficiencies or any consumer benefits that 
        were claimed as a benefit of the acquisition and the extent to 
        which any cost savings were passed on to consumers; and
            ``(C) the effectiveness of any divestitures or any 
        conditions placed on the acquisition in preventing or 
        mitigating harm to competition.
    ``(2) The requirement to provide the information described in 
paragraph (1) shall be included in an agreement described in that 
paragraph.
    ``(3) The Federal Trade Commission, with the concurrence of the 
Assistant Attorney General, by rule in accordance with section 553 of 
title 5, United States Code, and consistent with the purposes of this 
section--
            ``(A) shall require that the information described in 
        paragraph (1) be in such form and contain such documentary 
        material and information relevant to a proposed acquisition as 
        is necessary and appropriate to enable the Federal Trade 
        Commission and the Assistant Attorney General to assess the 
        competitive impact of the acquisition under paragraph (1); and
            ``(B) may--
                    ``(i) define the terms used in this subsection;
                    ``(ii) exempt, from the requirements of this 
                section, information not relevant in assessing the 
                competitive impact of the acquisition under paragraph 
                (1); and
                    ``(iii) prescribe such other rules as may be 
                necessary and appropriate to carry out the purposes of 
                this section.''.

SEC. 5. OFFICE OF COMPETITION ADVOCATE.

    (a) Definitions.--In this section--
            (1) the term ``agency'' has the meaning given the term in 
        section 551 of title 5, United States Code;
            (2) the term ``covered company'' means any company that 
        has, at any time, been required to make a filing under section 
        7A of the Clayton Act (15 U.S.C. 18a);
            (3) the term ``Office'' means the Office of the Competition 
        Advocate established under subsection (b);
            (4) the term ``Chairman'' means the Chairman of the 
        Commission; and
            (5) the term ``Commission'' means the Federal Trade 
        Commission.
    (b) Establishment.--There is established within the Federal Trade 
Commission the Office of the Competition Advocate.
    (c) Competition Advocate.--
            (1) In general.--The head of the Office shall be the 
        Competition Advocate, who shall--
                    (A) report directly to the Chairman; and
                    (B) be appointed by the Chairman, with the 
                concurrence of a majority of the Commission, including 
                at least 1 Commissioner who is not a member of the same 
                political party of the majority members of the 
                Commission, from among individuals having experience in 
                advocating for the promotion of competition.
            (2) Compensation.--The annual rate of pay for the 
        Competition Advocate shall be equal to the highest rate of 
        annual pay for other senior executives who report to the 
        Chairman of the Commission.
            (3) Limitation on service.--An individual who serves as the 
        Competition Advocate may not be employed by the Commission--
                    (A) during the 2-year period ending on the date of 
                appointment as Competition Advocate; or
                    (B) during the 5-year period beginning on the date 
                on which the person ceases to serve as the Competition 
                Advocate.
    (d) Staff of Office.--The Competition Advocate, after consultation 
with the Chairman of the Commission, may retain or employ independent 
counsel, research staff, and service staff, as the Competition Advocate 
determines is necessary to carry out the functions, powers, and duties 
of the Office.
    (e) Duties and Powers.--The Competition Advocate shall--
            (1) recommend processes or procedures that will allow the 
        Federal Trade Commission and the Antitrust Division of the 
        Department of Justice to improve the ability of each agency to 
        solicit reports from consumers, small businesses, and employees 
        about possible anticompetitive practices or adverse effects of 
        concentration;
            (2) recommend practices in certain industries that merit 
        antitrust investigation, but may not recommend practices in 
        certain industries that do not merit antitrust investigation or 
        are not anticompetitive;
            (3) publicly provide recommendations to other Federal 
        agencies about administrative actions that may have 
        anticompetitive effects and the potential harm to consumers if 
        those actions are carried out;
            (4) publish periodic reports on--
                    (A) market concentration and its impact on the 
                United States, local geographic areas, and different 
                demographic and socioeconomic groups; and
                    (B) the success of merger remedies required by the 
                Department of Justice or the Federal Trade Commission 
                in consent decrees;
            (5) collect data regarding concentration levels across 
        industries and the impact and degree of antitrust enforcement; 
        and
            (6) standardize the types and formats of data reported and 
        collected.
    (f) Subpoena Authority.--
            (1) In general.--The Competition Advocate may either 
        require the submission of or accept voluntary submissions of 
        periodic and other reports from any covered company for the 
        purpose of assessing market concentration and its impact on the 
        United States, local geographic areas, and different 
        demographic and socioeconomic groups and on the success of 
        merger enforcement.
            (2) Written finding.--Before issuing a subpoena to collect 
        the information described in paragraph (1), the Competition 
        Advocate shall make a written finding that--
                    (A) the data is required to carry out the functions 
                of the Competition Advocate; and
                    (B) the information is not available from a public 
                source or another agency.
            (3) Mitigation of report burden.--Before requiring the 
        submission of a report from any company required to make a 
        filing under section 7A of the Clayton Act (15 U.S.C. 18a), the 
        Competition Advocate shall--
                    (A) coordinate with other agencies or authority; 
                and
                    (B) whenever possible, rely on information 
                available from such agencies or authority.
    (g) Data Center.--
            (1) Establishment.--There is established within the Office 
        the Data Center.
            (2) Duties.--The Data Center shall--
                    (A) collect, validate, and maintain data obtained 
                from agencies, as defined in section 551 of title 5, 
                United States Code, commercial data providers, publicly 
                available data sources, and any covered company; and
                    (B) prepare and publish, in a manner that is easily 
                accessible to the public--
                            (i) a concentration database;
                            (ii) a merger enforcement database;
                            (iii) any other database that the 
                        Competition Advocate determines is necessary to 
                        carry out the duties of the Office; and
                            (iv) the format and standards for Office 
                        data, including standards for reporting 
                        financial transaction and position data to the 
                        Office.
            (3) Regulations.--The Competition Advocate shall promulgate 
        regulations relating to the collection and standardizing of 
        data under paragraph (2).
            (4) Confidentiality.--
                    (A) In general.--The Data Center may not disclose 
                any confidential data collected under paragraph (2).
                    (B) Requirements.--Data obtained from an agency 
                shall be subject to the same confidentiality 
                requirements and protection as the agency providing the 
                data.
                    (C) Information security.--The Competition Advocate 
                shall ensure that data collected and maintained by the 
                Data Center are kept secure and protected against 
                unauthorized disclosure.
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