2025 Perspectives in Private Equity: Public Policy

For private equity investors, the arrival of the 119th Congress and the new Trump administration shifts the landscape, creating uncertainty, challenge and opportunity in equal measure and highlighting the need for political due diligence on any deal. President Trump is expected to pursue an aggressive trade policy, including higher tariffs, while also seeking deals to expand exports and increase foreign investment in the United States.

President Trump has been vocal in his ambition to deregulate across industries. We expect the financial services sector will see the greatest impact, given the President’s support of digital assets and cryptocurrencies. The energy sector should also see a similar impact as a second Trump administration appears poised to repeal many of the Biden administration’s actions on climate change and the environment, with profound implications for sustainable investing and energy transition strategies. 

Technology deals, and particularly those involving foreign investment into strategic assets, will continue to attract regulatory scrutiny, but could receive President Trump’s blessing if appropriately structured. We expect a continuation of the trade and technology war with China, with the possibility of a range of action on tariffs, export controls and investment restrictions. Further, we could see some movement on patent protection and intellectual property oversight, with Elon Musk vocally anti-patent and raising questions for the new administration. President Trump was broadly positive toward patent owners during his first term in office, but we may now see that position shift. 

While Trump’s position on antitrust has not been clearly indicated, we can anticipate a more free market Republican approach at both the Federal Trade Commission and the Department of Justice than has been the case under Biden. The first Trump administration was not a bonanza for mergers and acquisitions (M&A) and certain deals ran into issues, so we expect some level of deal scrutiny to continue but a far less wide-ranging level of antitrust activity than we have seen over the past four years.

The evolving landscape on Capitol Hill and in the White House has the potential to impact private equity directly in several respects such as:

• The role of sovereign wealth funds in private equity, and more generally in investment into the United States.
• The role of insurance capital in private equity and, conversely, the role that private equity is starting to play in insurance coverage.
• The growing reach of private capital, as private equity funds increasingly move into providing private credit and other solutions, raising questions around consumer protection.
• Desire to establish a U.S. sovereign wealth fund, which could create another pool of potential investment for alternatives.