I. Introduction

In recent years, California’s status as one of just five states whose antitrust laws do not prohibit monopolization by a single company has prompted calls for reform. Coinciding with national antitrust reform efforts, the California Law Revision Commission (CLRC) began studying potential updates to the state’s antitrust laws in 2022. After reform efforts faltered in the previous two legislative sessions, the 2025–26 session brought significant momentum. The proposal, known as the Competition and Opportunity in Markets for a Prosperous, Equitable, and Transparent Economy (COMPETE) Act, was designed primarily to close gaps in state antitrust law that have allowed monopolistic conduct to go unchallenged. The initial version included a private right of action, which would have empowered consumers, workers, and businesses harmed by monopolistic practices to bring claims themselves. This provision prompted intensive lobbying by corporate interests represented by the California Chamber of Commerce (CalChamber).

Following extensive legislative deliberation, state lawmakers removed the private right of action in August while also narrowing public enforcement authority. The revised proposal also removed single-firm conduct claims under the state’s Unfair Competition Law (UCL), a broader statute governing "unlawful, unfair or fraudulent" conduct. Although the bill was substantially weakened, the Legislature ultimately passed the COMPETE Act in August and sent it to Gov. Gavin Newsom for his signature. These changes drew condemnation from public-interest groups that had strongly supported the initial measure. Nevertheless, the final, defanged bill has still been characterized as a victory for anti-monopoly politics. Substance matters more than intent or style in policymaking, and the bill’s passage stands to provide political cover to politicians seeking to bolster their populist credentials while leaving monopoly power largely intact.

II. Defanging of Legislation

BACKGROUND AND CORPORATE OPPOSITION

The effort to pass the COMPETE Act followed earlier attempts to modernize California’s antitrust laws. During the 2021–22 session, a bipartisan effort led by Assemblymembers Buffy Wicks (D-CA) and Jordan Cunningham (R-CA) culminated in a resolution directing the California Law Revision Commission (CLRC) to review gaps in state antitrust law. In the years that followed, the commission’s study process drew staunch opposition from industry groups. Alongside CalChamber, Google and technology trade groups including Chamber of Progress and the Computer & Communications Industry Association (CCIA) submitted comments opposing reform. In line with tech companies’ record of funding academic work opposed to stronger antitrust enforcement, Chapman University professor Tom Campbell submitted NetChoice-sponsored research in opposition to the changes.

In 2026, the campaign to pass the COMPETE Act met similarly strong corporate opposition. CalChamber labeled the bill a "cost driver," echoing its past practice of branding proposals "job killers," a designation that has historically contributed to bills’ failure to pass. The Lever reported in August that lobbyists affiliated with Big Tech spent more than $6 million opposing the COMPETE Act. During this lobbying battle, Senate lawmakers voted to advance a revised bill that eliminated the earlier proposed private right of action. This revision further narrowed the legislation by, among other things, eliminating language that would have permitted claims involving "market power." Instead, it would be restricted solely to conduct involving "substantial market power." 

INSUBSTANTIAL REFORM AS POLITICAL COVER

The revised COMPETE Act has been characterized by several outlets as a triumph for the anti-monopoly movement. On August 31, CalMatters published a report with a headline stating that "California [is] to get more power to sue big businesses under anti-monopoly bill going to Newsom." Though the report acknowledges that the legislation was substantially weakened from the initial proposal, news coverage is likely to continue emphasizing the law's stated intent rather than its limited enforcement mechanisms. The bill's passage, far from a setback for CalChamber and corporate interests more generally, could prove more valuable than an outright defeat: passing the bill gave lawmakers political cover, allowing them to tout a victory against monopoly power. In doing so, its passage risks slowing momentum for real antitrust reform in California in the future.

Unfortunately, the COMPETE Act's trajectory is not an uncommon one. The bill's fate is reminiscent of several other statewide corporate regulation efforts, which would ultimately be defanged as a result of lobbyist opposition. In our analysis of Maryland’s ostensible prohibition on surveillance pricing, we noted that industry-backed revisions removed the bill’s substance, with its passage ultimately providing political cover to state officials. As with the California COMPETE Act, Maryland lawmakers removed a proposed private right of action, leaving enforcement to under-resourced state officials. Although California Attorney General Rob Bonta (D-CA) has established himself as a leader in reining in monopolies, limited public resources may hinder efforts to pursue violators. This danger to meaningful anti-monopoly enforcement led advocacy groups including the American Economic Liberties Project to withdraw their support after the COMPETE Act was revised.

III. Conclusion

The defanging of the COMPETE Act illustrates how lobbying groups can use their influence to strip meaningful proposals of their force. The bill’s passage risks giving lawmakers an excuse to declare the issue resolved without addressing misconduct by powerful corporations. It remains unclear whether Gov. Gavin Newsom, widely considered a potential 2028 presidential candidate, will sign the bill. Newsom’s antitrust posture has come under greater scrutiny amid the attorney general-led effort to block the Paramount-Warner Bros. Discovery merger. He may therefore sign the COMPETE Act to bolster his record on corporate power despite its limited substance. If Newsom sincerely values antitrust enforcement, he should veto the legislation.​​​