Better Late Than Never? FTC Finally Releases Guidance On Section 5

After years of academic debate and internal deliberation, the Federal Trade Commission today unveiled a "Statement of Enforcement Principles" that generally describes conduct prohibited by Section 5 of the FTC Act.

Section 5 gives the FTC authority to take action against "unfair methods of competition."  Legislative history indicates that it was left to the FTC to provide specific content to Section 5's broad language. Since its enactment 100 years ago, however, little clarity has developed regarding what conduct does and does not qualify as an "unfair method of competition" that might subject an actor to enforcement proceedings, litigation, or penalties brought by the FTC.

It is widely understood that "unfair methods of competition" was intended to cover at least the same conduct that would violate the Sherman or Clayton Acts. But, in recent years, the scope of the FTC's "standalone" Section 5 enforcement authority—Section 5-based challenges to conduct that