California’s COMPETE Act makes single-firm monopolisation unlawful from 1 January 2027: what platform and software vendors should review

California’s COMPETE Act makes single-firm monopolisation unlawful from 1 January 2027: what platform and software vendors should review

2 October 2026 — California's Governor Gavin Newsom signed AB 1776, the COMPETE Act, on 30 September 2026. It amends the Cartwright Act, California's main antitrust law, and takes effect on 1 January 2027. Until now, the Cartwright Act reached agreements between companies but not one company acting alone; federal law has covered single-firm monopolisation. The new law closes that gap at state level.

What the law says

According to Crowell & Moring's summary, the law makes it "unlawful for every person to monopolize or monopsonize, attempt to monopolize or monopsonize, maintain a monopoly or monopsony, or combine or conspire with another person to monopolize or monopsonize any part of trade or commerce". Key points:

• Enforcement is public only. The private right of action was removed during the legislative fight; only the Attorney General and district attorneys can bring cases.
• Substantial market power must be shown. The statute does not define it; the governor described it as "a necessary — but not sufficient — condition to prove unlawful conduct".
• A safe harbour protects businesses that lawfully obtain or keep market power "through superior products or business acumen".
• Monopsony is included, which covers dominant buyers as well as sellers, relevant to labour markets and to platforms that buy from many small suppliers.

Who is affected

Large platforms, marketplaces, app stores, cloud providers and enterprise software vendors with strong positions in California markets, and their customers and partners. Contract terms that tie products together, exclusive arrangements, licence restrictions that make switching hard, and terms imposed on suppliers or developers are the kinds of conduct state enforcers are likely to examine.

Not yet independently verified. The Attorney General’s announcement did not answer from our location on 2 October and was not re-read; the provisions above come from a law firm’s summary and CalMatters. No penalty amounts were stated in the sources read. We will update this when it can be confirmed, and remove this note.

What to do

• Vendors with large market shares in California: have counsel review bundling, exclusivity, most-favoured-nation and switching-cost terms before 1 January 2027.
• Customers and partners of dominant vendors: keep records of terms you were given no choice about; they are relevant if the Attorney General opens an inquiry.
• Companies hiring in concentrated local labour markets: the monopsony provision reaches buyers of labour too.

Sources

• California Attorney General: Attorney General Bonta celebrates signing of COMPETE Act into law — 30 September 2026
• Crowell & Moring: The COMPETE Act becomes law, what the new antitrust law means for California businesses — 30 September 2026
• CalMatters (via Almanac): Newsom signs anti-monopoly bill after bruising legislative battle — 30 September 2026