Statement of Commissioners
Orson Swindle and Thomas B. Leary

 

Memorandum of Agreement Between the Federal Trade Commission and
The Antitrust Division of the United States Department of Justice
Concerning Clearance Procedures for Investigations

By now it is public knowledge that on January 17, 2002, the Chairman of the Federal Trade Commission and the Assistant Attorney General in charge of the Antitrust Division of the Department of Justice were on the cusp of executing an Agreement that would clarify and expedite the interagency clearance process for antitrust matters. Largely because of misinformation and misunderstandings regarding both the substance of the Agreement and the process by which it was reached, it was not possible to execute the Agreement at this time. We can hardly find the words to express our disappointment at this forgone opportunity to install an improved clearance process that promised substantial benefits for merging parties, the antitrust bar, the business community at large, and the consuming public (not to mention the agencies themselves).

The Agreement would have established and publicly memorialized a methodology for allocating matters between the Commission and the Antitrust Division that would have represented a major advance in the rationality, predictability, and speed with which the agencies divide their workload. Of course, reasonable people might have differed over which agency would have handled certain sectors of the economy, but it is the essence of compromise that neither agency will be fully satisfied. Two of our colleagues are concerned about ceding media and cable matters to the Department of Justice; it is very likely, however, that some in the Department are upset that significant matters like electricity and healthcare would be ceded to the Commission. The fact is that each agency has a plausible claim on each of these areas, and the tradeoffs between agency heads that have taken place in the past will continue in the future without the signed agreement, only in a far less efficient and transparent way.

We are not troubled by the process by which the Agreement was fashioned. Not only was negotiation of the Agreement with Assistant Attorney General James the prerogative of Chairman Muris; it was also simply the most effective way to get the job done. Historically, the agencies employed a procedure for dealing with clearance issues that was based on a case-by-case approach, with the Chairman and the Assistant Attorney General making the ultimate decision when necessary (with little or no involvement by other Commissioners). This long course of interagency discussion and negotiation then established "precedent" for allocating antitrust review responsibilities between the agencies -- a kind of "private law" for the kinds of matters that the Agreement was designed to describe publicly. It is proper that the agency heads were the ones to devise a new arrangement that would have injected greater efficiency and clarity into the allocating system -- a system in which the Chairman, and not other Commissioners, will continue to have operational responsibilities.