U.S. Chamber Urges Caution When Expanding FTC's Authority Beyond Standard Antitrust Laws

Releases Study Highlighting Heavy Burden of Justification for Expansive Use of Section 5 Authority

WASHINGTON, D.C.—A study released today by the U.S. Chamber of Commerce urged caution when using Section 5 of the Federal Trade Commission Act to enforce competition policy outside antitrust laws.

"This study shows that any proposal to extend Section 5 bears a heavy burden of justification," said the U.S. Chamber's Senior Director of Antitrust Chris Braddock. "With recent changes in leadership at the FTC, there are renewed calls to extend this section to additional forms of competitive conduct beyond established antitrust law. The commission is being invited—from within and without—to use Section 5 to attack diverse categories of conduct otherwise outside the scope of antitrust law."

The basic legal restrictions on the competitive conduct of businesses arise from two federal antitrust statutes—the Sherman Act and the Clayton Act. By passing the Federal Trade Commission Act in 1914, Congress created the FTC and authorized it under Section 5 to attack "unfair methods of competition."

The Chamber opposes any use of Section 5 beyond the current antitrust laws without clear standards that bind its use to types of conduct that are obviously not proper business behavior and could distort the competitive process.

"Advocates for expansion have not justified the existence of a clearly definable class of conduct that is both anticompetitive yet beyond the reach of our current antitrust doctrine," Braddock said. "The FTC must also provide significant notice and guidance to the business community – including hearings – before embarking on cases that are uniquely covered by Section 5."

The Chamber's study is available at: /publications/reports/0909_antitrust

The U.S. Chamber is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region.

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