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COVID-19 Merger Moratorium Could Hamper Vital Innovation
18 May 2020
Dr. Gabriella Monahova, Dr. Emily Walden, and Dr. Stephanie Demperio
The proposed Pandemic Anti-Monopoly Act recently introduced by Senator Elizabeth Warren and Representative Alexandria Ocasio-Cortez would temporarily prohibit a significant number of mergers and acquisitions during the COVID-19 pandemic. In a Law360 article, NERA Senior Consultant Dr. Gabriella Monahova, Senior Consultant Dr. Emily Walden, former Associate Director Dr. Stephanie Demperio, and Cooley LLP Partner Tanisha James express concerns for such a broad ban on M&A activity because:
- It could increase the level of uncertainty in the market and, as a result, risks cutting critical sources of funding for the small businesses the bill’s sponsors are seeking to support, and
- Agencies and existing merger review laws are sufficiently robust and flexible to handle required M&A analysis, even during a pandemic.
While the proposed act may be well-intentioned, such a broad ban on M&A activity could stifle firms' ability to grow or merely stay afloat in these uncertain times.