Karl Herchenroeder

The FTC and DOJ Antitrust Division are looking at possible changes to Hart-Scott-Rodino (HSR) Act implementation, FTC said Monday, announcing an NPRM and Advance NPRM to be published in the Federal Register. It said the NPRM suggests proposed transaction filers disclose more information about their associates and exempting the acquisition of 10% or less of an issuer's voting securities. The ANPRM seeks information on such topics as the size of the transaction and routes for avoiding the HSR Act requirements. The FTC said the vote to publish the ANPRM was 5-0. The NPRM vote was 3-2, with Commissioners Rohit Chopra and Rebecca Kelly Slaughter dissenting. Chopra said the exemptions provisions are concerning because the FTC "will completely lose visibility into a large set of transactions involving non-controlling stakes." Slaughter said the expanded de minimis exemption is a "broadening of the black box of unseen transactions," and the proposed changes could have unforeseen effects on corporate governance. DOJ antitrust chief Makan Delrahim said he backs creating an exemption for certain de minimis investments of 10% or less "to address the regulatory burdens of an overbroad HSR requirement for certain minority investments that do not raise competition concerns.” DOJ said the agency was particularly interested in feedback on the NPRM on removing the director/officer and vendor/vendee carve-outs.

The FCC has power to regulate social media, and the First Amendment supports the Trump administration’s petition for rulemaking, NTIA replied Friday (see 2009020064). The commission can require disclosure of information services under the Communications Act, and courts have ruled “search engines, browsers and internet social media precursors such as chat rooms are information services,” wrote acting Director Adam Candeub. He asked to grant its petition for Communications Decency Act Section 230 rulemaking.

Chinese-owned apps TikTok and WeChat will be banned from U.S. app stores starting Sunday, the Commerce Department announced Friday, citing national security concerns (see 2008240047). “The Chinese Communist Party (CCP) has demonstrated the means and motives to use these apps to threaten the national security, foreign policy, and the economy of the U.S.”

The U.S. should recruit global talent to ensure it keeps its advantage with artificial intelligence technology, National Security Commission on Artificial Intelligence (NSCAI) Chairman Eric Schmidt told the House Intelligence and Emerging Threats Subcommittee on Thursday. Chairman James Langevin, D-R.I., questioned whether limitations on foreigners studying in the U.S. plays into China’s hands, since workforce talent determines a country’s AI development. Many Chinese graduate students are responsible or partly responsible for the top academic papers on AI, Schmidt said. He recommended recruiting top talent from all countries and working to keep them in the U.S., producing research and helping create defense companies: “I’d much rather have them creating successes in America.” Responding to Langevin about AI investment, Schmidt said the U.S. isn’t overinvested in anything AI-related but underinvested in underlying infrastructure. NSCAI Commissioner Mignon Clyburn noted the commission’s first-quarter recommendations are filled with opportunities for the federal government to embrace AI as a “way of life, a way of your job” and a national strategic priority. Rep. Elisa Slotkin, D-Mich., asked about a structural change to ensure these recommendations and innovation are incorporated. NSCAI Vice Chairman Robert Work noted the commission recommended a technological steering group with intelligence and defense officials to examine how to integrate technology for the military’s advantage. Rep. Anthony Brown, D-Md., drew attention to the report’s recognition that AI needs to account for racial diversity, citing his concerns about bias. AI algorithms need to be built by design to avoid racial bias issues, said NSCAI Commissioner Jose-Marie Griffiths. She recommended R&D for algorithm development.

If Joe Biden wins the November election, expect Democrats to pursue antitrust law changes that would raise the bar for acquisitions, experts said in recent interviews. President Donald Trump has shown more interest in politically driven attacks than serious policy work, they said.

The FTC is collaborating with at least six state attorneys general on contact tracing scams, Chairman Joe Simons recently wrote Sens. Jerry Moran, R-Kan., and Amy Klobuchar, D-Minn. We obtained the correspondence through a Freedom of Information Act request. The FTC is working with state AGs in Alaska, Georgia, Massachusetts, New Jersey, North Carolina and Oregon, plus the National Association of Attorneys General, Simons wrote the senators Aug. 4. An FTC spokesperson declined comment on whether the group plans law enforcement action.

TikTok sued the Trump administration Monday, challenging its effort to “ban” the company in the U.S. and citing a lack of due process (see 2008070032). TikTok prefers constructive dialogue over litigation, but President Donald Trump’s executive order leaves the company with “no choice,” it said Monday. The White House and DOJ didn’t comment.

Qualcomm’s victory before the 9th U.S. Circuit Court of Appeals strengthens the hand of patent holders like Huawei, which could create national security risks, tech industry officials and antitrust attorneys said in interviews. A Qualcomm proponent said the FTC shouldn’t seek an appeal in a case that would put “more bad law on the books against” the agency (see 2008110065).

The 9th U.S. Circuit Court of Appeals sided with Qualcomm Tuesday in an FTC antitrust lawsuit against the company. In the minutes after the ruling, Qualcomm's stock rose, closing 2.3% higher at $108.83. The FTC is reviewing its options.

The 9th U.S. Circuit Court of Appeals Tuesday sided with Qualcomm in an FTC antitrust lawsuit against the company. In the minutes after the ruling, the company's stock rose.