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As someone who doesn't fully understand the rules around these acquisitions, is there a clear enough framework for what companies one can acquire? Are companie
by maurys 6y ago
As someone who doesn't fully understand the rules around these acquisitions, is there a clear enough framework for what companies one can acquire?
Are companies more frequently flouting that or is this a case of suing companies while the regulatory framework catches up?
Basically, is suing companies to block acquisitions standard procedure?
- frenchman_in_ny 6y agoBasically, it's codified in Hart–Scott–Rodino [0] [0] https://en.wikipedia.org/wiki/Hart%E2%80%93Scott%E2%80%93Rodino_Antitrust_Improvements_Act https://en.wikipedia.org/wiki/Hart%E2%80%93Scott%E2%80%93Rod...
- ballenf 6y agoThere are clear-ish rules for when you need to report the transaction and seek clearance in advance. They come down to transaction size, I believe. But the DOJ/FTC can sue to block any transaction on antitrust grounds, whether reportable or not. There are no rules that block any particular acquisition, just rules about whether you need to preemptively notify the government about the transaction and give them time to decide whether to challenge it.
- texasbigdata 6y agoHere is likely what you’re referring to. Above ~~$75M it has to be declared and then you are subject to review. https://en.m.wikipedia.org/wiki/Hart–Scott–Rodino_Antitrust_Improvements_Act https://en.m.wikipedia.org/wiki/Hart–Scott–Rodino_Antitrust_...
- mrkurt 6y agoYes it's standard, or at least it was. The FTC has been rubber stamping acquisitions for almost 20 years.
- xoxoy 6y agothey blocked the Harry’s Razor acquisition successfully
- xnyan 6y agoFrom a realpolitik perspective, It's not possible for their to be a standard procedure in practice. Even if the law is clear and unambiguous (it's not), prosecutors and regulatory bodies have the discretion to attempt to enforce or not. These decisions are subject to an ever shifting set of power and influence as circumstances and motivations change. As an example, in general the way Facebook and Google operate is not substantively different than it was a decade ago. The impending anti-trust action they are facing is a result of changing feelings and external conditions, not a (significant) change in law and regulation.
- zaksoup 6y agoA decade ago Facebook did not own Instagram or WhatsApp. Framing this as "Facebook and Google have not changed how they operate" is disingenuous, seeing as Anti-trust has generally been enforced over what is in the interest of the consumer. Google has always been an advertising company. Google's growing monopoly, however static their operating methods have been, is no longer viewed as in the consumers' best interest and is thus now under scrutiny. I don't think it's all that accurate to frame this as "people in power are threatened by [big tech]'s power" when there are plenty of reasonable people making convincing arguments that big tech is no longer operating in the best interests of the consumer.
- stale2002 6y ago> is there a clear enough framework for what companies one can acquire? There are clear enough general goals and a factors to consider, I'd say. Those goals being that transactions are prevented based on if they are anti-competitive (limit competition in some way), and if the purchasing company has significant market power. The sticking point though, is when those general goals are passed or not.