	Introduction

Pursuant to the Clayton Act and the Federal Trade Commission Act (FTC Act), Congress charged the Department of Justice (DOJ) and the Federal Trade Commission (FTC) with reviewing whether proposed mergers comport with federal antitrust laws and preventing anticompetitive mergers. Pre-Merger Review: Application of the Clayton Act and FTC Act

While other federal laws, including the Sherman Act, seek to deter anticompetitive harms caused by monopolization and agreements to restrain trade, two federal statutes, the Clayton and the FTC Acts, relate particularly to proposed mergers. Section 7 of the Clayton Act applies to mergers "in any line of commerce" when their effect "may be substantially to lessen competition, or to tend to create a monopoly" unless the merger is statutorily exempt. Section 5 of the FTC Act prohibits unfair methods of competition and includes any activity that violates Section 7 of the Clayton Act. The Hart-Scott-Rodino Antitrust Improvements Act and the Pre-Merger Review Process

The Hart-Scott-Rodino Antitrust Improvements Act (HSR Act) requires businesses exceeding certain sizes to report proposed mergers and other transactions valued above specified thresholds to the DOJ and FTC so that the agencies may examine whether those transactions comply with federal antitrust laws. If the agency determines that the merger would be likely to lessen competition substantially, the agency may either negotiate with the transacting parties to address its concerns or act to block the merger. Conclusion

Federal antitrust law prohibits mergers and acquisitions that may substantially lessen competition.
Preserving competition is an overarching purpose of federal laws governing business mergers. Though other federal laws, including the Sherman Act, seek to address anticompetitive behavior relating to monopolization, two federal statutes, in particular, address harms that may result from proposed mergers. Section 7 of the Clayton Act prohibits mergers "in any line of commerce or in any activity affecting commerce" that may substantially lessen competition or tend to create a monopoly. Section 5 of the Federal Trade Commission Act (FTC Act) prohibits unfair methods of competition, which includes any activity that violates Section 7 of the Clayton Act.
Pursuant to the Clayton and FTC Acts, Congress authorized the Department of Justice (DOJ) and the Federal Trade Commission (FTC) to determine whether a proposed merger would substantially lessen competition or tend to create a monopoly. Title II of the Hart-Scott-Rodino Antitrust Improvements Act (HSR Act) requires transacting parties, which exceed certain sizes, to report significant planned mergers and acquisitions to the FTC and DOJ so that the agencies may determine whether the proposed transactions raise anticompetitive concerns. If the FTC or DOJ determines that such concerns exist, the agencies may commence administrative or judicial proceedings to block the proposed transaction. Reviewing courts and administrative law judges consider a variety of factors when determining whether a proposed merged complies with federal antitrust laws.
This report examines the primary statutes and processes that govern federal pre-merger review and merger challenges.