Labor and employment

The EO calls on federal agencies to take actions against practices that impede worker mobility, suppress wages, and restrict competition. Specifically, the EO:

• Encourages the FTC to ban or limit non-compete agreements.
• Encourages the FTC to ban unnecessary occupational licensing restrictions that impede economic mobility.
• Encourages the FTC and the Department of Justice (DOJ) to strengthen antitrust guidance to prevent employers from collaborating to suppress wages or reduce benefits by sharing wage and benefit information.

Health care and medicine

The EO tackles a number of areas where the lack of competition in health care may increase prices and reduce access to quality care. Specifically, the EO:

• Directs the FDA to work with states and tribes to safely import prescription drugs from Canada, under the Medicare Modernization Act of 2003.
• Directs HHS to increase support for generic and biosimilar drugs, which provide low-cost options for patients.
• Directs HHS to issue a comprehensive plan within 45 days to combat high prescription drug prices and price gouging.
• Encourages the FTC to ban “pay for delay” and similar agreements by rule.
• Directs HHS to consider issuing proposed rules within 120 days for allowing hearing aids to be sold over the counter. 
• Underscores that hospital mergers can be harmful to patients and encourages the DOJ and the FTC to review and revise their merger guidelines to ensure patients are not harmed by such mergers.
• Directs HHS to support existing hospital price transparency rules and to finish implementing bipartisan federal legislation to address surprise hospital billing.
• Directs HHS to standardize plan options in the National Health Insurance Marketplace so people can comparison shop more easily.

Transportation

The EO addresses issues unique to the transportation sector, primarily resulting from the fact that the air travel, rail travel, and shipping industries are now dominated by large corporations. To combat the identified issues, the EO:

• Directs the DOT to consider issuing clear rules requiring the refund of fees when baggage is delayed or when service is not actually provided (i.e., when the plane’s Wi-Fi or in-flight entertainment system is not in service).
• Directs the DOT to consider issuing rules that require baggage, change, and cancellation fees to be clearly disclosed to the customer.
• Encourages the STB to require railroad track owners to provide rights of way to passenger rail and to strengthen their obligations to treat other freight companies fairly.
• Encourages the FMC to ensure vigorous enforcement against shippers charging American exporters exorbitant fees.

Agriculture

Because key agricultural markets have become more concentrated and less competitive in recent years, the Biden administration has recognized that the markets for seeds, equipment, feed, and fertilizer are now dominated by a few large companies. Accordingly, family farmers and ranchers now have to pay more for these inputs. Additionally, domestic farmers are being threatened by the import of meat by foreign corporations that often use labels that mislead customers about the origin of that meat. To combat these issues and others, the EO:

• Directs the Department of Agriculture (USDA) to consider issuing new rules under the Packers and Stockyards Act that will make it easier for farmers to bring and win claims, stopping chicken processors from exploiting and underpaying chicken farmers, and adopting anti-retaliation protections for farmers who speak out about bad practices.
• Directs the USDA to consider issuing new rules defining when meat can bear “Product of USA” labels, so that consumers have accurate, transparent labels that enable them to choose products made here.
• Directs the USDA to develop a plan to increase opportunities for farmers to access markets and receive a fair return, including supporting alternative food distribution systems like farmers’ markets and developing standards and labels so that consumers can choose to buy products that treat farmers fairly.
• Encourages the FTC to limit powerful equipment manufacturers from restricting people’s ability to use independent repair shops or do their own repairs, even when farm equipment manufacturers put policies in place that attempt to block farmers from repairing their own farm equipment.

Technology

The EO addresses a number of issues the administration has identified that limit competition, raise prices, and reduce choices for Internet services. In the EO, the FCC is encouraged to:

• Prevent Internet Service Providers (ISPs) from making deals with landlords that limit tenants’ choices.
• Revive the “Broadband Nutrition Label” and require providers to report prices and subscription rates to the FCC.
• Limit excessive early ISP subscription termination fees.
• Restore Net Neutrality rules that have been weakened by the policies of the prior administration.

The EO also tackles three areas in which dominant tech firms are perceived as engaged in behaviors that ultimately undermine competition and reduce innovation. Consistent with the Biden administration’s policy to increase scrutiny of mergers, especially by dominant Internet platforms, with particular attention on the acquisition of nascent competitors, serial mergers, the accumulation of data, competition by “free” products, and the effect on user privacy, the EO encourages the FTC to:

• Establish rules on surveillance and the accumulation of data.
• Establish rules barring unfair methods of competition on Internet marketplaces.
• Issue rules against anticompetitive restrictions on using independent repair shops or doing repairs of personal devices and equipment without voiding product warranties.

Banking and consumer finance

To combat what the administration calls excessive bank consolidation, which it views as having created increased costs for consumers, denied credit opportunities for small businesses, and generally harmed low-income communities, the EO:

• Encourages the DOJ and the agencies responsible for banking (the Federal Reserve, the FDIC, and the Office of the Comptroller of the Currency) to update guidelines on banking mergers to provide more robust scrutiny of mergers.
• Encourages the CFPB to issue rules allowing customers to download their banking data and take it with them.

Defense procurement

The administration is focused on ensuring that the Department of Defense’s (DOD’s) assessment of the economic forces and structures shaping the capacity of the national security innovation base under sections 889(a) and 899(b) of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021 (Public Law 116-283, 134 Stat. 3388) is consistent with its policies and is committed to ensuring that anticompetitive practices, behaviors, and conduct are not barriers to the DOD having access to the broadest base of suppliers to meets its procurement needs. As such, the EO requires the DOD to:

• Submit to the Chair of the White House Competition Council, a review of the state of competition within the defense industrial base, including areas where a lack of competition may be of concern and any recommendations for improving the solicitation process, consistent with the goal of the Competition in Contracting Act of 1984.
• Submit a report to the Chair of the White House Competition Council, a plan for avoiding contract terms in procurement agreements that make it challenging or impossible for the DOD or service members to repair their own equipment, particularly in the field.

Preliminary takeaways

Although the EO will not immediately drive changes because its initiatives will be subject to rule-making and regulatory processes, its goals are expected to significantly impact the areas of labor and employment, health care and medicine, transportation, agriculture, technology, and defense procurement in the months and years ahead. In light of the breadth of this EO and the potential for Congress to enact laws that align with the EO’s directives, it is important for stakeholders in the private sector to closely monitor the EO and the way that the federal agencies handle implementation. For example, industry stakeholders will need to monitor whether the EO’s recommendations are ultimately implemented because independent federal agencies, such as the FTC and the FCC, are not obligated to carry out White House directives. 

Reed Smith is carefully monitoring this developing topic. Watch for additional updates from our team on the requirements of this EO and its expected implementation.

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