The Decision For A Company

From the liberal point of view, the FTC and the EC should recognize the Boeing-McDonnell Douglas merger as an international issue, not a national issue, so that it should restrain autonomy of state, in this case the U.S., preventing from intervention to protect domestic interests. However, in the case of Boeing-Mc Donnell Douglas, both antitrust authorities, specifically the European Commission, acted in a protectionist manner keeping domestic interests. In a study on 290 proposed acquisitions screened by the EC during 1990, it was found that although European merger and acquisition regulators claim to be protecting competition and consumers, in fact, the more harm suffered by European rival firms when the acquire is coming from the outside the EU, the greater the likelihood of European regulatory intervention against the proposed merger or acquisition . The EC’s focus on competitors rather than consumers was revealed by this study.

On particular piece of evidence that can be shown to the FTC is in that the elasticity of demand either remained unaffected by this merger or that it increased. Taking this into consideration, if a comparison of price elasticity was done before and after the merger, there would be proof that consumers still had a large amount of substitutes available in the market. Depending on the type of market present, such as a Global Market, it would be relatively simple to prove the wide array of substitutes that were available to the consumers. This particular merger may have been done for what every company is looking for, which is cost savings. One other form of evidence to be provided to the FTC is a statement of costs, which should show costs before and after the merge.

The Federal Trade Commission(FTC) was created in 1914. It was created to ensure that there were no businesses that were anticompetitive; meaning that there wasn’t one company or business that was creating a monopoly. The FTC has three main goals; they are to protect consumers, maintain competition, and advance performance. They protect the consumers by preventing fraud and making sure businesses are fair in the marketplace. They maintain competition by preventing companies from merging together and creating a monopoly. Finally, they advance performance by advancing the FTC’s performance through organizational, personal, and management excellence. The FTC is very beneficial, and although not everybody knows about it, as a consumer it helps with the economy of every American. Throughout the years since it was created, there has been more laws added that help keep businesses

The Federal Trade Commission (FTC) was created in 1914 primarily as a way for the government to “trust bust” or apply regulations ensuring a free marketplace for U.S. consumers and business enterprises. In this regard, the FTC enforces antitrust viola- tions that could hamper consumer interests, as well as federal consumer protection laws against fraud, deception, and unfair business practices. The commission’s primary enforcement mechanism is the Bureau of Consumer Protection, which is divided into seven divisions: (1) enforcement, (2) advertising practices, (3) financial practices, (4) marketing practices, (5) planning and information, (6) consumer and business educa- tion programs, and (7) privacy and identity protection.21 As the federal

The role of antitrust laws has been the subject of numerous publications that have attempted to provide a precise set of reasons and inspirations for their creation. However, there are still many schools of thought on the subject and much debate over the effectiveness and legitimate implementation of these laws. This paper analyzes the three main antitrust laws that the federal branch of the United States government uses to try to restrict monopolies. This paper also looks at antitrust laws in the modern business environment, and attempts to relay the information in a manner that a newcomer to the subject will understand the concept as it relates to modern technology and business practices. The findings of this paper indicate that the topic of antitrust laws is more complex than many believe and, depending on the position of the person affected by monopolies, the sentiment ranges widely.

The FTC (or The Federal Trade Commission) is a bipartisan agency with for mission to protect consumers and promote competition. The goal is to protect consumers and promote competition around the world and the USA. The agency protects consumers by fighting against unfair, deceptive or fraudulent practices in the marketplace. The FTC make rules to develop a perfect marketplace, and educate consumers and business about their rights.

Antitrust laws are a collection of laws and regulations, put into place over time, to help govern the competiveness of large corporations. Enforced by the Federal Trade Commission and the Antitrust Division of the U.S. Department of Justice (DOJ) (“Antitrust Laws,” 2003), the laws help regulate ethical behavior between businesses to ensure that smaller businesses can compete with the bigger name corporations. Mergers and monopolies come into play and greatly affect how these businesses run. This paper will look at two different instances of possible violated laws and discuss the specifics. The first case deals with a pharmaceutical company, the second two telecommunications companies. One question being answered for both examples is what kind of ethical dilemmas are present. Read on as the cases are examined.

Generally, an industry consolidation can generate concerns regarding monopolistic tendencies and negative affects on market trends. In a monopoly, companies maximize profits, control prices, place prohibitive barriers to entry, and minimize competition. As expected, this PBM consolidation did raise similar concerns by the NCPA (2011) and encouraged the FTC to block the consolidation based on monopoly power and market domination. However, the NCPA is incorrect when describing this merger as a monopoly. Monopolies typically occur in a supply chain market. PBM’s are sellers of goods and services. As such, this consolidation is in fact an oligopsony, describing a market with many sellers and few buyers. An oligopsony market allows for competition and compliments consumers. The anti-trust concern, however, may be whether competition will remain strong enough to pass any cost savings to the PBM’s customers, i.e. employer plans, health plans, and other client markets.

While the FTC does pass most mergers that are brought forth, some deals do not go through. One of the deals that did not go through was when in 2013, SYSCO Corporation put in an offer to purchase rival U.S. Foods for what was to be worth around $8.2 Billion (F). If this deal would have went through, then the combined company would have created a powerhouse that would have made up 75 percent of the food distribution market in the United States (F). After over a year of trying to make the merger happen, a Washington U.S. District Judge put forth a preliminary injunction that stated the acquisition was being blocked over objections that said the larger company would hurt competition (G). This decision came after a lawsuit was filed by the FTC

When companies combine/merge the whole objective is to gain new opportunities, gain market share, grow the business, to become more innovative and to improve product offerings, utilizing/sharing the existing resources and data. From the case

1. Use the decision-making model (page 196) presented in the chapter to map the decisions being made in these situations. Identify how, where, and why different decisions might be made.

The rational decision-making model describes a series of steps that decision makers should consider if their goal is to maximize the quality of their outcome. In other words, if you want to make sure that you make the best choice, going through the formal steps of the rational decision-making model may make sense. The following are the steps taken to come to a rational decision: 1. Identify the problem, 2. Establish decision criteria, 3. Weigh decision criteria, 4. Generate alternatives, 5. Evaluate the alternative, 6. Choose the best alternative, 7. Implement the decision, 8. Evaluate the decision.

They have obtained civil consent decrees that will contribute to lower prices and improved quality for such products. In addition, they have also worked with businesses to restructure mergers in order to protect competition in the American marketplace.

FTC claimed that based on various analysis and evidence, proposed merger between Staples and Office Depot will harm competition in office superstore chain market and raise market price which will lessen customers’ welfare. Nevertheless, two parties of merger casted doubt on every detailed statement, and interpreted that this merger will reduce costs, broaden scale of economies, improve economic efficiency, and optimize resource allocation, and then lower market price efficiently. Finally, the Court chose to agree with FTC’s contention.

The General Electric (GE) and Honeywell International (HI) case illustrates the complexities of structuring mergers and acquisitions when the combined firms are capable of exerting market influence that threatens the competitive landscape. While General Electric's CEO, Jack Welch, characterized the deal as, "This is the cleanest deal you'll ever see," European anti-trust regulators were not so inclined to view the transaction as harmless to competition (Elliot, 2001).