TRICKY TECH TITANS

Buying-spree ‘loophole’

Big tech companies have snapped up hundreds of smaller tech firms in recent years — and have used “loopholes” to avoid antitrust scrutiny, according to the Federal Trade Commission.

Critics say that acquisitions can be used by big tech firms to shut down potential competitors, stifling innovation, hurting users and potentially creating or reinforcing monopolies. That’s why the FTC and Justice Department are supposed to review larger deals.

But Facebook, Google, Amazon, Apple and Microsoft together made 616 acquisitions from 2010 to 2019 that were worth more than $1 million each and that did not trigger reviews by the FTC or Department of Justice, the FTC said in a study released Wednesday.

FTC commissioner Rebecca Slaughter described a “Pac-Man strategy” through which companies gobble up their competition.

“Each individual merger viewed independently may not seem to have significant impact,” the Democrat said. “But the collective impact of hundreds of smaller acquisitions can lead to a monopolistic behavior.”

FTC chief Lina Khan — a Big Tech critic who was confirmed as chair in June — argued the report showed that regulators need to scrutinize smaller transactions more frequently.

“The FTC may have created loopholes that are unjustifiably enabling deals to fly under the radar,” Khan said.

The review also found big tech companies routinely use non-compete clauses to ban workers from taking jobs at rival companies.

Nearly 77 percent of the transactions reviewed used “non-compete clauses for founders and key employees of the acquired entities,” according to the review.

The Biden administration argued in a July executive order that non-compete clauses “may unfairly limit worker mobility” and encouraged the FTC to “curtail” their use.

“Exploring how firms in digital markets may be using acquisitions to lock up key assets along with talent will be a worthy area of study,” Khan said.

Matt Stoller, an antitrust expert and former senior adviser to the Senate Budget Committee, said the FTC’s report shows how Big Tech firms use non-competes to stifle competition.

“There aren’t that many people that really know how to manage large amounts of data, or certain aspects of cybersecurity, or have deep knowledge of search algorithms,” he told The Post. “If you can lock up a significant amount of people who know that area, then you give yourself a competitive advantage.”

The FTC launched a wideranging probe into Amazon and is also probing Facebook for monopolization and anticompetitive conduct.