When the Federal Trade Commission (“FTC”) or
Department of Justice (“DOJ”) believes a merger or
acquisition will have anti-competitive effects, it typically either
attempts to block the transaction outright or conditions approval
of the transaction on the transaction parties' acceptance of
behavioral or structural remedies.
Historically, the FTC and DOJ preferred structural remedies over
behavioral ones. Behavioral remedies, in which the parties agree to
restrictions designed to prevent anticompetitive behavior by the
combined company, require ongoing conduct limitations and
monitoring, if not active policing by the agencies. On the other
hand, structural remedies, which often involve the divestiture to a
third party of the product or business held by the buyer or target
that when combined with the other party's business raises
anticompetitive concerns, represent a one-time fix by changing the
competitive landscape.
