California COMPETE Act expands public single-firm antitrust enforcement
Oct 11, 2026 edition · GC-2026-0196 · Published 2026-10-11 · Version 3 · Final
The September 30 COMPETE Act adds a California monopoly and monopsony enforcement standard requiring substantial market power. New section 16731 actions belong to the Attorney General or district attorneys, with defined small-business and supervised governmental-authority exclusions; it does not create a new private single-firm action.
What happened
California enacted AB 1776, the COMPETE Act, on September 30 as Chapter 826. New Business and Professions Code section 16731 prohibits the specified monopolization and monopsonization conduct, including attempts and maintenance, and requires plaintiffs to allege and prove substantial market power through direct or indirect evidence. Courts must use the identified California Supreme Court analytical framework. The act also emphasizes competition for workers and distinguishes anticompetitive conduct from market power lawfully gained through superior products, services, or business acumen.
Only the Attorney General or a district attorney may initiate a section 16731 action, and the new violation generally cannot serve as a private Unfair Competition Law predicate; the clause preserves other actions outside this section. A defined California small-business exclusion requires independent ownership and operation, the stated location and officer conditions, no more than 100 employees with affiliates, and average annual receipts no greater than $10 million over the preceding three years. The section also preserves conduct within specified government-granted and supervised authority. These limits qualify the new public-enforcement pathway rather than immunizing all concentrated businesses or creating a new private single-firm claim.
Scope and timing
- Authority status
- Final
- Applicability
- Operationally relevant
- Audience
- Health systems, Provider networks
- Jurisdiction
- California
- Recorded date
- 2027-01-01
- Date type
- effective
Why it matters
Health care contracting, transaction, and workforce practices involving substantial market power may face the new state public-enforcement analysis. The statutory exclusions and public-only section 16731 action matter when assessing exposure, while other applicable antitrust claims remain separate.
Recommended action
Healthcare transaction and contracting teams should assess concentration and exclusionary-conduct risks with counsel under the final public-enforcement scope.
Sources
- Attorney General announces COMPETE Act signingOfficial · California Attorney General · 2026-09-30 · Source review 2026-10-04
- AB1776 chaptered operative textOfficial · California Legislature · 2026-09-30 · Source review 2026-10-11
- California Constitution, Article IV section 8(c), official Assembly 2023–24 editionOfficial · California State Assembly · Source review 2026-10-14
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