California COMPETE Act expands public single-firm antitrust enforcement
Oct 4, 2026 edition · GC-2026-0196 · Published 2026-10-04 · Version 2 · Final
The COMPETE Act adds a California monopoly and monopsony cause of action limited to public prosecutors. AB 1776 requires substantial market power, preserves specified small-business and supervised-government-authority exclusions and does not supply an unrestricted new private enforcement route.
What happened
California enacted AB 1776 on September 30, adding Cartwright Act provisions under the ordinary January 1, 2027 effective-date rule. New Business and Professions Code section 16731 prohibits monopolizing or monopsonizing, attempting either, maintaining monopoly or monopsony, and specified combinations or conspiracies. A plaintiff must allege and ultimately prove substantial market power through direct or indirect evidence under the cited California analytical framework. The legislative text includes competition for workers and recognizes that superior products, services or business acumen can lawfully produce market power.
Only the Attorney General or a district attorney may initiate an action under the new section, and a violation cannot serve as a private unfair-competition predicate outside such a public action. The statute does not change unrelated actions merely because this route is limited. It excludes a defined independently owned California small business meeting the employee, domicile and revenue conditions and preserves the specified granted-and-supervised government franchises, licenses, contracts and authorized conduct. Additional rules address combined or conspiratorial claims and complex-case filing. The final public-enforcement scope is therefore narrower than a general claim that any private party received a new single-firm lawsuit.
Scope and timing
- Authority status
- Final
- Applicability
- Operationally relevant
- Audience
- Health systems, Provider networks
- Jurisdiction
- California
Why it matters
Healthcare labor, contracting and market-position decisions may be reviewed for exclusionary conduct, but size alone does not establish unlawful monopoly behavior. Enforcement authority, the substantial-power requirement and exclusions affect the legal assessment.
Recommended action
Have transaction and contracting teams review concentration and exclusionary-conduct risks with antitrust counsel before January 2027. Consider competition for workers as well as services, and document any claimed statutory exclusion. Keep existing private claims distinct from the new public cause of action.
Sources
- Attorney General announces COMPETE Act signingOfficial · California Attorney General · 2026-09-30 · Source review 2026-10-04
- AB1776 enacted final textOfficial · California Legislature · 2026-09-30 · Source review 2026-10-05
- Official Assembly 2023-24 Constitution, Article IV section 8Official · California Legislature · Source review 2026-10-14
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