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From Antitrust Law Daily, September 15, 2017

Acting FTC chair discusses connection between competition and liberty

By Jeffrey May, J.D.

Wrapping up a week of speeches and testimony before Congress, Acting FTC Chairman Maureen K. Ohlhausen this morning provided attendees of the Fordham Competition Law Institute’s 44th Annual Conference on International Antitrust Law and Policy with examples of her agency’s efforts to tackle potential anticompetitive effects of occupational licensing and other government restraints on competition. Noting that "competition is a product of an individual’s liberty to pursue their desires," Ohlhausen discussed in her remarksthe government’s role in protecting and promoting competition, while at the same time ensuring individual liberty. She predicted that the FTC’s efforts "will continue to provide a firm foundation to safeguard the important link between competition and liberty."

"Government does not create or drive competition," said Ohlhausen. "Government instead provides a framework in which competition can thrive."

Occupational licensing reform. Ohlhausen highlighted recent enforcement actions that demonstrate the FTC's efforts to "mak[e] sure that the competitors fairly compete on the merits." First, the acting chairman pointed to her efforts to establish occupational licensing reform. This effort was identified as Ohlhausen’s first major initiative as acting chairman. In February, Ohlhausen announced in a speech at the George Mason Law Review’s 20th Annual Antitrust Symposium in Washington, D.C. the creation of an Economic Liberty Task Force to collaborate with state leaders and other stakeholders on occupational licensing reform. Since its inception seven months ago, the task force has held one public roundtable session on ways to facilitate license portability. A second rountable is coming up in November concerning empirical evidence of the effects occupational licensing has on consumers and workers. According to Ohlhausen, the effort has drawn media attention to the topic and the initiative has received support from state and local officials who want to bring jobs and talent to their states and cities.

Abuse of government processes. The acting chairman also discussed an enforcement action aimed at an alleged abuse of government processes by a private actor to reduce competition. Ohlhausen pointed to the first case that she brought as head of the agency—a challenge to Shire ViroPharma Inc.’s alleged efforts to delay generic competition to its branded prescription drug, Vancocin HCL Capsules, by waging a campaign of serial, repetitive, and unsupported filings with the Food and Drug Administration (FDA) to delay the FDA’s approval of a generic version. She pointed out that ViroPharma made a total of 46 filings to the FDA. The agency alleged that this abuse of the FDA process caused generic entry to be delayed a number of years, costing consumers hundreds of millions of dollars.

When is government intervention appropriate? Lastly, Ohlhausen cited the agency’s successful effort to block the combination of Draft Kings and FanDuel as an example of where it is necessary for an antitrust agency to step in to protect competition. The agency issuedan administrative complaint and a court complaint to block the deal on the ground that that the proposed combination would reduce competition in the U.S. market for paid daily fantasy sports contests—a two-to-one merger.

Ohlhausen warned that "it is a false dichotomy to suggest respect for the power and social utility of free markets must also lead competition enforcers to stand aside in situations where substantial consumer harm appears likely." According to Ohlhausen, "it is the job of the antitrust enforcer to halt actions that would undermine the dynamic, growing process of competition."

"I believe competition and liberty are strongly interconnected and interdependent," said Ohlhausen. "Markets and competition work because they channel the self-interest of the entrepreneur toward the greater good of society. Government’s role is to protect the process and not dictate results."

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