US Congress Members Want FTC To Review EA Sale To Saudi Arabia

Over three dozen United States (US) lawmakers want the Federal Trade Commission (FTC) to dive deeper into the pending sale of Electronic Arts (EA).

In a press release recently shared online, the leaders of the Labor Caucus along with over 40 members of US Congress are asking FTC chair Andrew Ferguson to take another look at the sale. In the letter, the Labor Caucus chairs say they have “serious concerns” regarding the sale of EA to the Saudi Arabia Public Investment Fund (PIF).

“We are committed to preserving fair, competitive labor markets and safeguarding American jobs, and given the impact of this acquisition on workers, labor market concentration, and the long-term competitiveness of the U.S. video game industry, we urge you to thoroughly review this transaction,” the letter reads.

“Workers in the video game industry are already navigating an environment marked by instability, shrinking opportunities, and repeated rounds of layoffs. EA is one of the largest employers of video game workers in the United States, and evidence suggests the company already wields significant wage-setting power.”

Congress Worried EA Sale Could Lead To More Layoffs

The lawmakers add that with the deal including $20 billion in debt being added to EA after the sale, the new owners would be incentivized to hold more layoffs in order to recoup money. They also express worry that more offshoring, restructuring, and studio closures could come after the closing of the deal.

“These actions would not only jeopardize thousands of high-skilled American jobs, but also further concentrate already fragile labor
markets for software engineers, artists, writers, testers, and other professionals whose skills are essential to the industry,” they said.

The Labor Caucus chairs say that FTC’s 2023 merger guidelines explicitly state that any mergers that harm workers or allow firms to reduce labor demand “may violate antitrust laws”. Due to the size of the deal—$55 billion—the group feels that extra scrutiny is essential to protecting the rights of American workers that are involved.

They are asking the FTC to “conduct a thorough investigation into the labor market consequences of this proposed acquisition, including EA’s existing wage-setting power, the likelihood of post-transaction layoffs, the degree of labor-market concentration in relevant geographic and occupational markets, and the role of cross-ownership in shaping labor outcomes.” 

What do you make of US lawmakers requesting further investigation into the sale of EA to the Saudi Arabia PIF? Leave your thoughts down in the comments below, and join the discussion in the official Insider Gaming Discord.

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