President Joe Biden's skeptical approach to corporate mergers has been a hallmark of his administration's business policy — a stance generally expected to ease if Donald Trump returns to the White House.
Biden appointees like Lina Khan, chair of the Federal Trade Commission, and Assistant Attorney General Jonathan Kanter have broadened the scope of government antitrust oversight to consider issues such as a deal's impact on workers and on potential new market entrants.
Dealmakers have complained of added costs from this heightened scrutiny, while Khan and Kanter insist they have deterred problematic deals.
But with the clock ticking on Biden's tenure, the antitrust and dealmaking universes have begun to ponder what comes next as voters weigh the candidacies of Vice President Kamala Harris and former president Donald Trump.
While a Trump win is broadly expected to result in less antitrust enforcement and more dealmaking than a Harris victory, even that outcome is not certain, as today's Republican coalition includes not just corporate interests but figures like Trump's running mate Senator JD Vance, who has praised Khan.
"There is a lot of uncertainty there," said New York University Professor Harry First. He said the populist tilt of some members of Trump's coalition "makes it hard to predict what will happen."
A Trump election win would be "slightly positive to very positive" for dealmaking, predicted a Wall Street banker, who spoke on condition that he not be identified. He cautioned that optimism over a potential shift under Trump should be tempered by worries over a renewed US-China trade war.
Biden set an adversarial tone toward dealmaking early in his presidency, saying that too many big companies were "consuming their competitors." An executive order he signed in July 2021 promoted competition and included tougher antitrust enforcement.
Biden cast the approach as a needed pivot from a failed 40-year "experiment of letting giant corporations accumulate more and more power."
The appointment of Khan sent a clear message to the business world, including tech behemoths.
Khan shot to prominence following a 2017 academic article on Amazon that criticized antitrust enforcement for overlooking key priorities such as a deal's impact on workers and the potential for big companies -- not yet monopolies -- to discourage new competitors from emerging.
Khan and Kanter have signaled the importance of these issues, including in merger guidelines finalized in December 2023.
They have scored some litigation wins, including the unwinding of Illumina's acquisition of Grail in a case involving cancer detection tests; and a ruling this month that Google's search engine constituted a monopoly in a case originally brought by the Trump administration.
But the Biden administration has also suffered some major setbacks, losing a challenge to Microsoft's takeover of Activision Blizzard and to UnitedHealth Group's acquisition of Change Healthcare.
Former FTC enforcement official Ryan Quillian has pointed to data that the current commission actually has filed fewer lawsuits than its predecessors. He argued in an October 2023 paper that the Biden administration's "rhetoric outpaces" its enforcement numbers.
Quillian, now a partner with Covington & Burling, said the agencies were focused on "rhetoric and process to deter" merger activity.
CEOs considering transactions now weigh the chance of antitrust enforcement "at the beginning of a deal," said the Wall Street banker, adding that "there is no question that clients think two or three times more about deals that are on the line."
The American Investment Council, a trade group for the private equity industry, has sharply criticized a Biden administration proposal to significantly increase pre-merger notification disclosures.
The proposed changes to the Hart-Scott-Rodino Act would include details about the rationale of a transaction, projected revenue streams and corporate relationships.
The proposed rule "will make it far more costly to consummate such deals," slowing the American economy "to the detriment of the very consumers whom the antitrust laws are intended to benefit," the council said in September 2023 comments.
Those changes have yet to be finalized. The next administration will need to decide whether to uphold this policy, along with the 2023 merger guidelines, which would need to be adopted by US courts to have teeth.
Other questions concern pending lawsuits against tech giants Apple, Amazon, Google and Facebook parent Meta, and whether to proceed with litigation or take another route, such as settlement or dismissal.
