You Have to Pay to Give Oil Away

South Carolina will let some retailers open today, Georgia will permit gyms and hair salons to do so on Friday, and Tennessee won’t renew a lockdown order set to expire on April 30. All three states said they believed that infections had leveled off enough to let them reopen their economies.

They’re doing so despite the debate over coronavirus testing. Other states are arguing that they can’t reopen because there isn’t enough screening for the virus. An official with the W.H.O. warned this morning that the lifting of lockdowns must be gradual to avoid a second wave of infections.

• Denmark, which has opened some schools and businesses, has pledged to test everyone with symptoms.

The Deal Professor: The big get bigger

Steven Davidoff Solomon, a.k.a. “The Deal Professor,” is the faculty director at the Berkeley Center for Law, Business and the Economy

If past crises are any guide, the big technology companies are about to sidestep antitrust laws and get even bigger.

Consider last week’s decision by British regulators to allow Amazon’s investment in the London-based food delivery start-up Deliveroo. Amazon said last May that it was joining a $575 million fund-raising round, valuing Deliveroo at perhaps as much as $4 billion. Britain’s Competition and Markets Authority halted the deal because it thought it might be bad for competition.

That was before the pandemic.

Deliveroo argued that, without Amazon’s money, it would have to shut down. The British antitrust authority backed down, saying that if Deliveroo went bust, it “could mean that some customers are cut off from online food delivery altogether, with others facing higher prices or a reduction in service quality.”

Expect this to be repeated elsewhere. In the U.S., big companies will take advantage of the so-called failing firm exemption to antitrust law. This doctrine, which dates from a 1930 Supreme Court case, allows otherwise anticompetitive deals to succeed when the target would probably fail without the deal and there is no other viable investment. American Airlines used it when buying TWA.

Article source: https://www.nytimes.com/2020/04/21/business/dealbook/oil-price-negative.html