Opinion ID: 108732
Heading Depth: 2
Heading Rank: 1

Heading: The Purposes of ′ 7

Text: As is clear from its face, § 7 was designed to deal with the anticompetitive effects of excessive industrial concentration caused by the corporate marriage of two competitors. It is the basic premise of [§7] that competition will be most vital `when there are many sellers, none of which has any significant market share.'  United States v. Aluminum Co. of America, 377 U. S., at 280. But § 7 does more than prohibit mergers with immediate anticompetitive effects. The Act by its terms prohibits acquisitions which may . . . substantially . . . lessen competition, or . . . tend to create a monopoly. The use of the subjunctive indicates that Congress was concerned with the potential effects of mergers even though, at the time they occur, they may cause no present anticompetitive consequences. See, e. g., FTC v. Procter & Gamble Co., 386 U. S. 568, 577 (1967). To be sure, remote possibilities are not sufficient to satisfy the test set forth in § 7. Despite substantial concern with halting a trend toward concentration in its incipiency. Congress did not intend to prohibit all expansion and growth through acquisition and merger. The predictive judgment often required under § 7 involves a decision based upon a careful scrutiny and a reasonable assessment of the future consequences of a merger without unjustifiable, speculative interference with traditional market freedoms. As we stated in Brown Shoe Co. v. United States, 370 U. S. 294, 323 (1962): Congress used the words `may be substantially to lessen competition' (emphasis supplied), to indicate that its concern was with probabilities, not certainties. Statutes existed for dealing with clear-cut menaces to competition; no statute was sought for dealing with ephemeral possibilities. Mergers with a probable anticompetitive effect were to be proscribed by this Act. See also United States v. Pabst Brewing Co., 384 U. S., at 552; United States v. Penn-Olin Chemical Co., 378 U. S. 158, 171 (1964). The legislative history of § 7 makes plain that this was the intent of Congress. Before 1950, § 7 prohibited only those mergers which lessened competition between the corporation whose stock is so acquired and the corporation making the acquisition. [11] The Celler-Kefauver Amendment, added in 1950, deleted these words and provided instead that all mergers which substantially lessened competition in any line of commerce in any section of the country were to be outlawed. See 64 Stat. 1126. Thus, whereas before 1950, § 7 proscribed only those mergers which eliminated present, actual competition between the merging firms, the Celler-Kefauver Amendment reached cases where future or potential competition in the entire relevant market might be adversely affected by the merger. [12] Section 7 of the Clayton Act was intended to arrest the anticompetitive effects of market power in their incipiency. The core question is whether a merger may substantially lessen competition, and necessarily requires a prediction of the merger's impact on competition, present and future. . . . The section can deal only with probabilities, not with certainties. . . . And there is certainly no requirement that the anticompetitive power manifest itself in anticompetitive action before § 7 can be called into play. If the enforcement of § 7 turned on the existence of actual anticompetitive practices, the congressional policy of thwarting such practices in their incipiency would be frustrated. FTC v. Procter & Gamble Co., 386 U. S., at 577.