Congressional bills would ban tech mergers over $5 billion

Senator Elizabeth Warren has long made it clear that she no fan of Big Tech, and her latest law proves it. She and House Representative Mondaire Jones have introduce legislation in their respective congressional chambers would effectively ban major tech mergers. The Prohibition of the Anti-Competition Merger Act (PAMA) would make it illegal to pursue “prohibited mergers”, including deals valued at more than $5 billion or providing a market share in excess of 25% to employers and 33% For the seller.

The bills would also give antitrust regulators more power to block and review mergers. They will have the power to completely refuse the merger without a court order. They will also prevent mergers from companies with records of antitrust violations or other cases of “corporate crime” over the past decade. Officials will have to assess the impact of the acquisition on the workforce, and will not be allowed to negotiate with companies to secure “measures” to address the merger.

Importantly, PAMA will formalize procedures for reviewing past mergers and dismantling “harmful agreements” that are alleged to be damaging to competition. The Federal Trade Commission has signaled a The voluntees to spin off tech giants like Meta despite approving the merger years earlier. PAMA could make it easier to shorten those acquisitions and force brands like Instagram and WhatsApp to operate as separate businesses.

The act isn’t strictly technology-focused, but Warren has made it clear that industry is a target. She warned the FTC about Amazon’s Proposal to Acquire MGM Studiosand challenged Lockheed Martin’s abandoned effort to acquire Aerojet Rocketdyne.

If it becomes law, PAMA will ban the Amazon-MGM alliance (worth more than $8.4 billion), Microsoft Activision Agreement ($68.7 billion) and relatively modest acquisitions such as Google’s Mandiant Acquisition Plan ($5.4 billion). Technology companies will largely have to focus on acquiring ‘small’ companies, and most will have to forgo deals in order to expand market share or otherwise dominate the cement industry in a single market. certain field.

However, there are obstacles that could prevent PAMA from reaching President Biden’s desk. Neither the Senate nor the House bills have Republican supporters – either Democrats or left-leaning independents like Senator Bernie Sanders. That should be enough to clear the House, but the Senate bill could fail if it doesn’t get full support from sitting Democrats. Thus, this may represent more of a statement of intent on the part of the Democratic Party than a fundamental shift in regulatory policies.

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