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California Assembly Bill 1776, the Competition and Opportunity in Markets for a Prosperous, Equitable and Transparent Economy (“COMPETE”) Act, is rapidly advancing through the California state legislature and is now positioned for a full Senate floor vote. If enacted, the COMPETE Act would significantly expand California’s antitrust statute, the Cartwright Act.
The stated purpose is to align California with federal law to cover monopolization claims based on single-firm conduct similar to claims covered by Section 2 of the Sherman Act. Recent changes to the COMPETE Act aimed at securing passage in the current legislative session would both limit its enforcement but potentially also create greater uncertainty as to what conduct would be covered for companies participating in California’s trillion-dollar economy.
Key provisions to watch for
The current COMPETE Act, first introduced in February 2026, would make the following major changes to California’s Cartwright Act:
- Extension to single-firm conduct. The bill would expand the Cartwright Act’s reach beyond multi-firm coordinated conduct to include potential monopolization and monopsony claims stemming from unilateral business actions.
- Reduced evidentiary burdens. The bill does not fully enumerate specific evidence of anticompetitive conduct that would violate the Act. Rather, the bill outlines various routes plaintiffs can demonstrate violations–including examples of exclusionary conduct, quantitative evidence of harm to competition, and defendants recouping losses caused by harm to competition. A plaintiff would need to prove “substantial market power” through direct or indirect evidence.
- No cross-market justifications. The bill explicitly limits how a person could offset evidence of anticompetitive effects in one market when it has procompetitive benefits in a separate market or when it benefits another group of persons.
- Relationship to federal law. As drafted, the bill explicitly provides that federal antitrust case law is not conclusive as to interpretations of the Cartwright Act, which the California Supreme Court has found differs certain respects from the Sherman Act.
- No private right of action. The most recent amendments dropped the private right of action provided in the COMPETE Act. As currently contemplated, the draft only anticipates enforcement actions initiated by the California Attorney General or District Attorney.
Next steps
The bill is now eligible for a full Senate floor vote, and if it passes the Senate vote will return to the state Assembly for a procedural concurrence vote, which is needed because of the various amendments made by the Senate. The latest amendment paring back the private right of action is expected to result in the bill passing the full Senate vote. If approved by both the Senate and Assembly, the bill will go before Governor Gavin Newsom. Unless Newsom vetoes, the COMPETE Act could be effective as soon as January 2027. It is still unclear how Governor Newsom views the bill, but his most recent budget allocates USD14.3 million in special funds to the Attorney General’s antitrust unit, signaling an interest in increased enforcement.
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