[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 3426 Introduced in Senate (IS)]
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116th CONGRESS
2d Session
S. 3426
To deter anticompetitive exclusionary conduct that harms competition
and consumers, to enhance the ability of the Department of Justice and
the Federal Trade Commission to enforce the antitrust laws, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 10, 2020
Ms. Klobuchar (for herself, Mr. Blumenthal, and Mr. Booker) introduced
the following bill; which was read twice and referred to the Committee
on the Judiciary
_______________________________________________________________________
A BILL
To deter anticompetitive exclusionary conduct that harms competition
and consumers, to enhance the ability of the Department of Justice and
the Federal Trade Commission to enforce the antitrust laws, and for
other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Anticompetitive Exclusionary Conduct
Prevention Act of 2020''.
SEC. 2. FINDINGS AND PURPOSES.
(a) Findings.--Congress finds that--
(1) competitive markets, in which multiple firms compete to
buy and sell products and services, are critical to ensuring
economic opportunity for all people in the United States;
(2) when companies compete, businesses offer the highest
quality and choice of goods and services for the lowest
possible prices to consumers and other businesses;
(3) competition fosters small business growth, reduces
economic inequality, and spurs innovation and job creation;
(4) in the United States economy today, the exercise of
market power is substantial and growing;
(5) anticompetitive exclusionary conduct is an important
source of market power and a substantial threat to the United
States economy;
(6) when dominant sellers exercise market power, they harm
buyers by overcharging them, reducing product or service
quality, limiting their choices, and impairing innovation;
(7) when dominant buyers exercise market power, they harm
suppliers by underpaying them, limiting their business
opportunities, and impairing innovation;
(8) when dominant employers exercise market power, they
harm workers by paying them low wages, reducing their benefits,
and limiting their future employment opportunities;
(9) nascent or potential rivals can be an important source
of competitive discipline for dominant firms;
(10) antitrust enforcement against anticompetitive
exclusionary conduct has been impeded when courts have declined
to rigorously examine the facts in favor of inaccurate economic
assumptions that are inconsistent with contemporary economic
learning, such as presuming that market power is not durable
and can be expected to self-correct, that monopolies drive
innovation, that above-cost pricing cannot harm competition,
and other flawed assumptions; and
(11) the courts of the United States have improperly
implied immunity from the antitrust laws based on Federal
regulatory statutes, even limiting the application of statutory
antitrust savings clauses passed by Congress.
(b) Purposes.--The purposes of this Act are to--
(1) deter exclusionary conduct that harms competition,
particularly by dominant firms; and
(2) enhance antitrust enforcement by the Department of
Justice, the Federal Trade Commission, the State enforcement
agencies, and private parties.
SEC. 3. DEFINITION.
In this Act, the term ``antitrust laws''--
(1) has the meaning given the term in subsection (a) of
section 1 of the Clayton Act (15 U.S.C. 12);
(2) includes--
(A) section 5 of the Federal Trade Commission Act
(15 U.S.C. 45) to the extent that such section applies
to unfair methods of competition; and
(B) this Act and the amendments made by this Act.
SEC. 4. EXCLUSIONARY CONDUCT.
(a) In General.--The Clayton Act (15 U.S.C. 12 et seq.) is amended
by inserting after section 26 (15 U.S.C. 26a) the following:
``SEC. 26A. EXCLUSIONARY CONDUCT.
``(a) Definitions.--In this section:
``(1) Exclusionary conduct.--
``(A) In general.--The term `exclusionary conduct'
means conduct that--
``(i) materially disadvantages one or more
actual or potential competitors; or
``(ii) tends to foreclose or limit the
opportunity of one or more actual or potential
competitors to compete.
``(B) Limitations.--
``(i) Applying for or enforcing a patent,
trademark, or copyright, unless such
applications or enforcement actions are
baseless or made in bad faith, shall not alone
constitute exclusionary conduct, but such
actions may be considered as part of a course
of conduct that constitutes exclusionary
conduct.
``(ii) Conduct that is necessary to comply
with Federal or State law shall not alone
constitute exclusionary conduct, but such
actions may be considered as part of a course
of conduct that constitutes exclusionary
conduct.
``(2) Market power.--The term `market power' means the
ability of a person, or a group of persons acting in concert,
to profitably impose transaction terms on counterparties,
including terms regarding price, quantity, product or service
quality, or other terms affecting the value of consideration
exchanged in the transaction, that are more favorable to the
person or group of persons than what the person or group of
persons could obtain in a competitive market.
``(b) Violation.--
``(1) In general.--It shall be unlawful for a person,
acting alone or in concert with other persons, to engage in
exclusionary conduct that presents an appreciable risk of
harming competition.
``(2) Unfair method of competition.--A violation of
paragraph (1) shall constitute an unfair method of competition
under section 5 of the Federal Trade Commission Act (15 U.S.C.
45).
``(c) Presumption.--
``(1) In general.--Exclusionary conduct shall be presumed
to present an appreciable risk of harming competition and shall
be a violation of subsection (b)(1) if the exclusionary conduct
is undertaken, with respect to a relevant market, by a person
or by a group of more than 1 person acting in concert that--
``(A) has a market share of greater than 50 percent
as a seller or a buyer in the relevant market; or
``(B) otherwise has significant market power in the
relevant market.
``(2) Exception.--The presumption in paragraph (1) shall be
rebutted if the defendant establishes, by a preponderance of
the evidence, that--
``(A) distinct procompetitive benefits of the
exclusionary conduct in the relevant market eliminate
the risk of harming competition presented by the
exclusionary conduct;
``(B) one or more persons, not including any person
participating in or facilitating the exclusionary
conduct, have entered or expanded their presence in the
market with the effect of eliminating the risk of
harming competition posed by the exclusionary conduct;
or
``(C) the exclusionary conduct does not present an
appreciable risk of harming competition.
``(d) Considerations.--If the presumption in subsection (c) does
not apply, the determination of whether exclusionary conduct presents
an appreciable risk of harming competition shall be based on the
totality of the circumstances, which may include consideration of--
``(1) the extent to which any distinct procompetitive
benefits of the exclusionary conduct substantially eliminate
the risk of harming to competition presented by the
exclusionary conduct; and
``(2) whether one or more persons, not including any person
participating in or facilitating the exclusionary conduct, have
entered or expanded their presence in the market, substantially
eliminating the risk of harming competition presented by the
exclusionary conduct.
``(e) Limitations.--Although the following circumstances may
constitute evidence of a violation of subsection (b)(1), such violation
does not require finding--
``(1) that the unilateral conduct of the defendant altered
or terminated a prior course of dealing between the defendant
and a person subject to the exclusionary conduct;
``(2) that the defendant treated persons subject to the
exclusionary conduct differently than the defendant treated
other persons;
``(3) that any price of the defendant for a product or
service was below any measure of the costs to the defendant of
providing the product or service; or
``(4) that the conduct of the defendant makes no economic
sense apart from its tendency to reduce competition.
``(f) Civil Penalties.--Any person who violates subsection (b)(1)
shall be liable to the United States for a civil penalty, which may be
recovered in a civil action brought by the Attorney General of the
United States, of not more than the greater of--
``(1) 15 percent of the total United States revenues of the
person for the previous calendar year; or
``(2) 30 percent of the United States revenues of the
person in any line of commerce affected or targeted by the
unlawful conduct during the period of the unlawful conduct.''.
(b) Federal Trade Commission Act.--
(1) Civil penalties.--Section 5 of the Federal Trade
Commission Act (15 U.S.C. 45) is amended by adding at the end
the following:
``(o) Civil Penalty for Violation of Section 26A of the Clayton
Act.--The Commission may commence a civil action in a district court of
the United States against any person, partnership, or corporation who
violates subsection (a)(1) respecting an unfair method of competition
that constitutes a violation of section 26A of the Clayton Act to
recover a civil penalty, which shall accrue to the United States, in an
amount not more than the greater of--
``(1) 15 percent of the total United States revenues of the
person, partnership, or corporation for the previous calendar
year; or
``(2) 30 percent of the United States revenues of the
person, partnership, or corporation in any line of commerce
affected or targeted by the unlawful conduct during the period
of the unlawful conduct.''.
(2) Commission litigation authority.--Section 16(a)(2) of
the Federal Trade Commission Act (15 U.S.C. 56(a)(2)) is
amended--
(A) in subparagraph (D), by striking ``or'' after
the semicolon;
(B) in subparagraph (E)--
(i) by moving the margins 2 ems to the
left; and
(ii) by inserting ``or'' after the
semicolon; and
(C) inserting after subparagraph (E) the following:
``(F) to recover civil penalties under section 5(o)
of this Act;''.
SEC. 5. JOINT ENFORCEMENT GUIDELINES.
(a) In General.--Not later than 1 year after the date of enactment
of this Act, the Attorney General and the Federal Trade Commission
shall issue joint guidelines outlining policies, practices, and
analytical techniques relating to agency enforcement under section 26A
of the Clayton Act, as added by section 4 of this Act, including agency
policies for determining the appropriate amount of a civil penalty to
be sought under section 26A of the Clayton Act and subsection (o) of
section 5 of the Federal Trade Commission Act (15 U.S.C. 45), as added
by section 4 of this Act, with the goal of promoting transparency and
deterring violations of section 26A of the Clayton Act.
(b) Penalty Considerations.--In establishing the guidelines
described in subsection (a) regarding civil penalties, the Attorney
General and the Federal Trade Commission shall consider the relevant
factors to be used for calculating an appropriate civil penalty for a
particular violation, including --
(1) the volume of commerce affected;
(2) the duration and severity of the unlawful conduct;
(3) the intent of the person undertaking the unlawful
conduct;
(4) the extent to which the unlawful conduct was egregious
or a clear violation of the law;
(5) whether the civil penalty is to be applied in
combination with other remedies for violations of section 26A
of the Clayton Act, including--
(A) structural remedies, behavioral conditions, or
equitable disgorgement; or
(B) other remedies available under section 4, 4A,
15, or 16 of the Clayton Act (15 U.S.C. 15, 15a, 25,
26) or section 13(b) of the Federal Trade Commission
Act (15 U.S.C. 53(b));
(6) whether the person has previously engaged in the same
or similar anticompetitive conduct; and
(7) whether the person undertook the conduct in violation
of a preexisting consent decree or court order.
(c) Updates.--The Attorney General and the Federal Trade Commission
shall update the joint guidelines issued under subsection (a), as
needed to reflect current agency policies and practices, but not less
frequently than once every 5 years beginning on the date of enactment
of this Act.
(d) Public Notice and Comment.--
(1) Guidelines.--Before issuing guidelines under subsection
(a) or subsection (c), the Attorney General and the Federal
Trade Commission shall publish proposed guidelines in draft
form and provide public notice and opportunity for comment for
not less than 60 days after the date on which the guidelines
are published.
(2) Inapplicability of rule making provisions.--The
provisions of section 553 of title 5, United States Code, shall
not apply to the guidelines issued under paragraph (1).
SEC. 6. MARKET DEFINITION.
(a) In General.--Establishing liability under the antitrust laws
does not require the definition of a relevant market, except when the
definition of a relevant market is required, to establish a presumption
or to resolve a claim, under a statutory provision that explicitly
references relevant market, market concentration, or market share.
(b) Direct Evidence.--If direct evidence is proffered of actual or
likely harm to competition or an appreciable risk to competition
sufficient to satisfy the applicable statutory standard, or that the
effect of an acquisition subject to section 7 of the Clayton Act (15
U.S.C. 18) may be substantially to lessen competition or tend to create
a monopoly, neither a court nor the Federal Trade Commission shall
require definition of a relevant market in order to evaluate the
evidence, to find liability, or to find that a claim has been stated
under the antitrust laws.
(c) Rule of Construction.--Nothing in this section may be construed
to prevent a court or the Federal Trade Commission from considering
evidence relating to the definition of proposed relevant markets to
evaluate the merits of a claim under the antitrust laws.
SEC. 7. LIMITATIONS ON IMPLIED IMMUNITY FROM THE ANTITRUST LAWS.
(a) In General.--In any action or proceeding to enforce the
antitrust laws with respect to conduct that is regulated under Federal
statute, no court or adjudicatory body may find that the Federal
statute, or any rule or regulation promulgated in accordance with the
Federal statute, implicitly precludes application of the antitrust laws
to the conduct unless--
(1) a Federal agency or department actively regulates the
conduct under the Federal statute;
(2) the Federal statute does not include any provision
preserving the rights, claims, or remedies under the applicable
antitrust laws or under any area of law that includes the
antitrust laws; and
(3) Federal agency or department rules or regulations,
adopted by rulemaking or adjudication, explicitly require or
authorize the defendant to undertake the conduct.
(b) Existing Federal Regulation.--In any action or proceeding
described in subsection (a), the antitrust laws shall be applied fully
and without qualification or limitation, and the scope of the antitrust
laws shall not be defined more narrowly on account of the existence of
Federal rules, regulations, or regulatory agencies or departments,
unless application of the antitrust laws is precluded or limited by--
(1) an explicit exemption from the antitrust laws under a
Federal statute; or
(2) an implied immunity that satisfies the requirements
under subsection (a).
SEC. 8. ADDITIONAL REMEDIES; RULES OF CONSTRUCTION.
(a) Additional Remedies.--The rights and remedies provided under
this Act are in addition to, not in lieu of, any other rights and
remedies provided by Federal law, including under section 4, 4A, 15, or
16 of the Clayton Act (15 U.S.C. 15, 15a, 25, 26) or section 13(b) of
the Federal Trade Commission Act (15 U.S.C. 53(b)).
(b) Rules of Construction.--Nothing in this Act may be construed
to--
(1) impair or limit the applicability of any of the
antitrust laws; and
(2) prohibit any other remedy provided by Federal law.
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