The FTC’s New Unfair Methods of Competition Policy Statement: To What Extent Will the Approach Survive in Court?

Abstract

On November 10, 2022, the Federal Trade Commission (FTC) issued a new Policy Statement regarding the scope of unfair methods of competition (UMC) under Section 5 of the FTC Act. The Statement was voted out along party lines with Commissioner Christine Wilson dissenting; it replaces the Obama Administration’s bipartisan 2015 Statement that tethered the analysis of UMC to the rule of reason standard. A key question is to what extent the Statement’s approach is likely to survive in court. While Section 5 clearly reaches beyond the Sherman and Clayton Acts, the issue is how far.

The Article is organized as follows: Section I summarizes the Policy Statement, Section II analyzes the caselaw interpreting the scope of UMC, and Section III identifies some theories of harm that are unlikely to survive in court.

Keywords: Federal Trade Commission, FTC, unfair methods of competition, UMC, antitrust

JEL Classification: K21, K23, L40, L41, L42, L43, L44, L51