The jointly-issued Department of Justice and Federal Trade Commission 2010 Horizontal Merger Guidelines largely reflect practices that the agencies already were implementing. However, the 2010 Guidelines include some significant changes from earlier versions, and as such provide clearer guidance to the business community and the public.
Market shares and concentration levels (as measured by the Herfindahl-Hirschman Index (HHI)) still are an important to the merger analysis. The 2010 Guidelines increased the HHI thresholds that the agencies use to assess whether a rebuttable presumption regarding market power applies. Although the HHI thresholds have increased, the revised treatment of market definition principles sometimes can result in narrower markets, and therefore, higher market concentration. HHIs and concentration often are used primarily as an initial screen — where the post-merger HHI is fairly low, it helps the government determine that further scrutiny may not be required. The 2010 Guidelines’ competitive effects focus means that where the post-merger HHI thresholds appear to be exceeded in an initial screen, agency staff then can shift to more sophisticated analysis of other factors to assess whether the transaction is likely lead to adverse competitive effects.