FTC launches probe on past acquisitions by tech giants

The Federal Trade Commission announced today that it has opened an antitrust probe on tech giants Alphabet Inc. (including Google), Amazon, Apple, Facebook, and Microsoft with regards to their past acquisition activities. The FTC is ordering the companies to submit information on past acquisitions they've made but didn't report to the antitrust agencies under the Hart-Scott-Rodino (HSR) Act.

The scope of the invesgtiation includes transactions completed between January 1, 2010 and December 31, 2019. Specifically, the probe is intended to look into the details of the terms, scope, structure, and purpose of those acquisitions.

Under the HSR Act, the FTC is mandated to review acquisitions and mergers over a certain size before their completion in order to inform the commission's decision on whether additional transactions should be subject to notification requirements prior to mergers. In addition, the Act requires firms to submit detailed filings with the FTC and Department of Justice before completing those mergers as both agencies must make sure those transactions are not anti-competitive.

Regarding the commission's move, FTC Chairman Joe Simons says:

“Digital technology companies are a big part of the economy and our daily lives. This initiative will enable the Commission to take a closer look at acquisitions in this important sector, and also to evaluate whether the federal agencies are getting adequate notice of transactions that might harm competition. This will help us continue to keep tech markets open and competitive, for the benefit of consumers.”

The FTC makes it clear, though, that its latest action on tech giants is not tied to any law-enforcement effort. Instead, the agency aims for the orders to understand how large technology companies go about their acquisitions and how they report their transactions to federal antitrust agencies. Also, the FTC wants to determine if the companies are making purchases of smaller firms or competitive companies that don't fall under the HSR filing guidelines.

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