Expanding the Scope of Unfair Competition
Just recently, the Federal Trade Commission issued a new statement that dramatically expands the scope of unfair competition. In many ways, it is a return to the days before the 2015 policy constraining the FTC was issued. The new policy aims to restore rigorous enforcement.
Ostensibly, the FTC will follow to general guidelines:
The conduct must be a method of competition and not simply a market condition that is outside of a particular respondent’s control.
The FTC will determine whether the method of competition is “unfair” using a sliding scale based on the following two factors:
Whether conduct is “coercive, exploitative, collusive, abusive, deceptive, predatory, or involves the use of economic power of a similar nature,” or is “otherwise restrictive or exclusionary.”
Whether conduct “tends to negatively affect competitive conditions,” which “may include, for example, conduct that tends to foreclose or impair the opportunities of market participants, reduce competition between rivals, limit choice, or otherwise harm consumers.”
While this is not law, per se, it is indicative of the FTC’s position and the steps it will take in the future when allegations of unfair competition are made.
To read the policy, click here.
