U.S. FTC says massive increase in mergers is curbing probe


WASHINGTON, Aug 3 - A massive increase in mergers against the U.S. Federal Trade Commission for antitrust reviews is limiting its ability to investigate deals in a timely manner, the FTC said on Tuesday.

It said in a statement that the influx is straining the agency's capacity to rigorously investigate deals ahead of the expected deadlines.

The agency said it was sending letters to some companies planning transactions that although its waiting period would soon expire, the FTC probe was not complete.

Please be advised that if the parties consummate this transaction before the Commission has finished its investigation, they would do so at their own risk, it said.

Commissioner Noah Phillips, a Republican who is critical of the new leadership at the FTC, said his understanding was that similar letters were tried in previous years, primarily to companies contemplating a transaction that the agency thought might be illegal.

The government shouldn't threaten litigation without a belief the law has been or will be broken. The issue that this raises for me is that if the letters are not being sent where we have some reason to conclude that the transaction is legal, I am concerned that they are intended to chill legal M&A across the board, he said.

The Antitrust Division of the FTC and Justice Department temporarily suspended the practice of granting early terminations for the most controversial deals in February. It did so because of the change in administrations and a rise in the number of merger filings.

Under merger law, transactions over a certain size must be reported to the government, which allows many to go forward quickly under what is called early termination. More controversial transactions trigger a second request or a demand for documents about the proposed transactions.