The Federal Trade Commission (FTC) plays a vitally important role in protecting consumers and the competitive process. However, this role is limited to the enforcement of existing laws as enacted by Congress and focused on cases where there is demonstrable and legitimate harm. Under current leadership, the FTC has brought complaints against companies using untested legal theory and pursued rulemaking authority under an expansive reading of Section 5. In response to the Innovation, Data and Commerce Subcommittee Hearing, the American Consumer Institute has released a series addressing the changes at the FTC and how they undermine consumer interests in the competitive process.

The U.S. Chamber of Commerce submitted a Freedom of Information Act (FOIA) request back in January 2022 to review communications between the Federal Trade Commission (FTC) and European regulators regarding Illumina’s acquisition of Grail, Inc. After a year and a lawsuit, the agency finally turned over the requested information, releasing it late February of this year. These documents reveal only the latest in a long list of actions undertaken by the FTC to undermine American businesses through foreign regulators.

In 2021, Illumina, a leading genomics researcher, reacquired Grail, a company it had started in 2016 to research new cancer detection methods. The FTC issued a complaint, stating the acquisition could one day lead to Grail increasing prices on Illumina’s competitors. The FTC’s argument was weakened by the fact that this was a vertical merger, which generally lowers costs for consumers. Additionally, Illumina had proposed a contract that would prevent it from substantially increasing prices for 12 years. Under the Consumer Welfare Standard that the courts generally use to evaluate the legality of FTC antitrust actions, this complaint was not likely to succeed.

Shortly after, the European Commission began investigating possible breaches in its antitrust code by Illumina’s merger. The investigation occurred even though Illumina conducts no business in Europe, which usually precludes these actions. By December 5, 2022, the European Commission denied the acquisition.

Speculation over what role the FTC played in this decision has been brewing for years. Only recently has the U.S. Chamber’s FOIA request revealed the extent to which these speculations were true. The FTC was in dialogue with the European Commission after the announced merger. Communications like this have been described as “information-sharing,” something FTC Chair Lina Khan mentioned in her hearing with the House Energy and Commerce Committee.

Illumina is not the first time the FTC and European Commission have communicated on antitrust action. The FTC’s Dec. 8 complaint against Microsoft Corp.’s acquisition of Activition Blizzard Inc. reportedly came only hours after a call between U.S. and European Union officials. The timing for this complaint was allegedly explained by an attempt to preempt a settlement with the European Commission. If true, this event would be another example of the FTC going out of its way to harm American companies through interference with foreign regulators.

Currently, the E.U. is in the process of phasing new antitrust regulations into law. On March 30, Chair Khan, Department of Justice Antitrust Division Assistant Attorney General Jonathan Kanter and Executive Vice President Margrethe Vestager of the European Commission met for the third meeting of the U.S.-E.U. joint technology competition policy dialogue (TCPD). The FTC’s post-meeting press release mentioned sending officials to assist with implementing the Digital Markets Act (DMA).

The DMA is the E.U.’s answer to supposed anticompetitive behavior. Much like the General Data Protection Regulation (GDPR), the DMA uses broad regulatory regimes to target “gatekeepers.” According to the DMA, a gatekeeper is a large, systemically-important online platform. The E.U. uses that “systemically-important” part to argue that said platforms have inherent anticompetitive attributes that require state oversight.

As a result, gatekeepers are not allowed to prefer certain products, cannot share user data between messaging and social media platforms, allow users to uninstall preloaded apps, etc. Concerns abound that these overbearing regulations will increase compliance overhead and further concentrate the tech sector, similar to the results of the GDPR. American startups might not be able to afford these added expenses, limiting their growth.

The FTC’s stated purpose is the enforcement of federal consumer protection laws. If the FTC wishes for American companies to adhere to the DMA, they can recommend Congress pass a similar bill. Until this happens, the agency is tasked with the enforcement of what is on the books in the United States, and not outside it.

Isaac Schick is a policy analyst at the American Consumer Institute, a nonprofit education and research organization. For more information about the Institute, visit www.TheAmericanConsumer.Org or follow us on Twitter @ConsumerPal.