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Agency Has Focused Enforcement on Sectors of Economy with Greatest
Impact on Consumers

Providing Federal Trade Commission testimony today before the U.S. Senate Judiciary Committee’s Subcommittee on Antitrust, Competition, and Business and Consumer Rights, Chairman Deborah Platt Majoras said that to accomplish its competition mission, the agency has focused its enforcement and outreach efforts on sectors of the economy that have the greatest impact on consumers. In the past year, she said, this has included work in areas such as health care, energy, and real estate, with the Commission pursing a broad range of merger and non-merger matters in those and other industries.

According to the Chairman’s testimony, the overall goal of the FTC’s competition mission is to “remove the obstacles that impede competition and prevent its benefits from flowing to consumers.” To achieve this goal over the past year the Commission has had to be especially resourceful, as the number of premerger filings grew to 1,768, a 28 percent increase from fiscal year 2004, and the number of requests for additional information increased by 40 percent over the same period, reflecting a corresponding increase in investigative activity.

The testimony first detailed the Commission’s competition accomplishments over the past year in the key areas of health care, energy, real estate, defense, and other industries. In the health care area, the Chairman described the FTC’s significant work in the areas of pharmaceuticals, medical devices and diagnostic systems, hospitals and other institutional providers, and physician price fixing. Major enforcement actions in FY 2006 were detailed, including a consent order to address competitive concerns raised by Teva Pharmaceutical’s $7.4 billion acquisition of Ivax Corporation, the Commission’s successful efforts to end an allegedly anticompetitive agreement between Warner Chilcott and Barr Laboratories related to the oral contraceptive Ovcon 35, an FTC administrative law judge’s ruling in favor of the staff in the Evanston Northwestern hospital competition matter, and several cases alleging price-fixing by physicians’ groups nationwide.

In the energy area, the testimony described the Commission’s continuing monitoring of retail gasoline and diesel prices in 360 cities and wholesale prices in 20 major urban areasto identify possible anticompetitive activities and determine whether a law enforcement investigation is warranted. Enforcement actions such as the agency’s November 2006 challenge of EPCO’s proposed $1.1 billion acquisition of TEPPCO’s natural gas liquids storage business were presented, along with the results of the Commission’s report on post-Hurricane Katrina gasoline price manipulation.

Enforcement actions in the real estate area were detailed next, with the FTC “actively investigating restrictive practices in the residential real estate industry, including efforts by private associations of brokers to impede competition from brokers who use non-traditional listing arrangements.” In July 2006, for example, the Commission charged the Austin Board of Realtors with violating antitrust laws by preventing consumers with real estate listing agreements for potentially lower-cost, unbundled brokerage services from marketing their listings on important public Web sites. Under a consent order with the FTC, the Board was prohibited from engaging in such anticompetitive conduct.

In defense and other industries, the testimony described the agency’s enforcement actions against Boeing Company and Lockheed Martin Corporation regarding their proposed joint venture, United Launch Alliance; the challenge to General Dynamics’ proposed $275 million acquisition of SNC Technologies regarding ammunition manufacturing processes for the U.S. military; and a consent agreement with Service Corporation International and Alderwoods, Inc., settling charges that the proposed acquisition would lessen competition in nearly 50 funeral or cemetery services markets nationwide.

This case-specific overview was followed by details on antitrust guidance, transparency, and merger process improvements achieved during FY 2006, as well as a summary of the FTC’s competition advocacy work, amicus brief filings to aid the courts in analyzing and resolving competition-related policy issues, and a summary of recent hearings, conferences, and workshops which the Chairman said “represent a unique opportunity for the agency to develop policy research and development tools, and help foster a deeper understanding of the complex issues involved in the economic and legal analysis of antitrust law.”

Finally, the testimony presented an overview of the FTC’s international coordination and technical assistance work, and described other competition outreach initiatives, such as the new industry-specific Web sites for Oil & Gas, Health Care, Real Estate, and Technology. “These minisites serve as a one-stop shop for consumers and businesses who want to know what the FTC is doing to promote competition in these important business sectors,” the testimony concluded, stating that in the past year the Commission also issued practical tips for consumers on buying and selling real estate, funeral services, and generic drugs, as well as “plain language” columns on oil and gas availability and pricing.

The Commission vote to approve the testimony and place a copy on the public record was 5-0. The written statement presented by the Chairman at the hearing represents the views of the FTC.

The FTC’s Bureau of Competition seeks to prevent business practices that restrain competition. The Bureau carries out its mission by investigating alleged law violations and, when appropriate, recommending that the Commission take formal enforcement action. To notify the Bureau concerning particular business practices, call or write the Office of Policy and Coordination, Room 394, Bureau of Competition, Federal Trade Commission, 600 Pennsylvania Ave, N.W., Washington, DC 20580, Electronic Mail: antitrust@ftc.gov; Telephone (202) 326-3300. For more information on the laws that the Bureau enforces, the Commission has published “Promoting Competition, Protecting Consumers: A Plain English Guide to Antitrust Laws,” which can be accessed at http://www.ftc.gov/bc/compguide/index.htm.


MEDIA CONTACT:

Mitchell J. Katz,
Office of Public Affairs
202-326-2161

(FTC File No. P072104)

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