The Federal Trade Commission announced the agenda for the eighth session of its Hearings Initiative with a one-day hearing at the New York University School of Law in New York City on December 6, 2018.
The day’s panels will examine concerns that acquisitions and holdings of non-controlling ownership interests in competing companies, for example by institutional investors, may have anticompetitive effects. See detailed agenda.
Some recent econometric studies have concluded that when investors hold stock in competing firms, competition may be reduced among those commonly held competing firms. The Commission invites public comment on this issue, including on the questions listed below.
- What is the state of the econometric and qualitative evidence for and against the proposition that such common ownership reduces competition?
- To what extent do the results suggest that this harm to competition extends to concentrated industries more generally?
- Is any likely harm limited to concentrated industries or does it extend to holdings in unconcentrated industries?
- What are the potential mechanisms by which such stock holdings would lead to anticompetitive harm, and how likely are they to lead to anticompetitive results?
- To what extent do institutional investors have the incentive and opportunity to affect corporate governance, particularly regarding competitive decision-making? How is such influence exercised?
- What enforcement and policy responses should be adopted in light of the existing evidence?
- What additional research should be undertaken on this issue?
- What data would be most useful to answer the question of whether common ownership reduces competition in concentrated industries?