Gavin Newsom Signs COMPETE Act Expanding Antitrust Laws

Governor Gavin Newsom signed Assembly Bill 1776, known as the COMPETE Act, on September 30, 2026. The law expands California's antitrust framework by allowing the state attorney general and district attorneys to sue individual companies for monopoly behavior and anticompetitive conduct. This marks a significant shift from the 1907 Cartwright Act, which only permitted legal action against agreements between two or more businesses.

To prevail in a case, prosecutors must demonstrate that a company possesses substantial market power. The law includes specific exemptions for small businesses with 100 or fewer employees and annual revenue below $10 million. The legislation takes effect on January 1, 2027.

The bill faced strong opposition from the California Chamber of Commerce and various technology groups, who argued the law is incompatible with federal antitrust statutes and could lead to GDP losses. To ensure the bill's passage, author Cecilia Aguiar-Curry removed a private right of action provision that would have enabled individuals or businesses to sue companies directly. The California Department of Finance also opposed the measure, citing the potential for significant new state costs to fund prosecutors.