Within a few days, President Reagan is expected to approve a new merger policy proposal that administration officials say would be the most important reform of the antitrust laws in a generation.

The proposal will face an uphill climb in Congress next year. But one of its provisions is a response to America's worsening competitive position in world trade, and is likely to find considerable political support.

This change offers a break for industries such as steel, shoes and textiles that are found to be suffering economic injury because of imports.

The president could approve a more lenient, permissive standard for assessing mergers in such industries, making corporate marriages easier in light of the industry's endangered condition.

If the Justice Department's antitrust division -- using the new, more lenient standard -- approved the merger, it could not be attacked on antitrust grounds by competitors or other private litigants.

Although the new standard hasn't been written yet, some informed administration officials say that the changes they have in mind could well have altered the outcome of one of the most controversial merger rulings by the Reagan administration.

In 1984, LTV Corp.'s steel division and Republic Steel Corp. announced their intention to merge.

Their goal was to combine the best parts of their steel businesses, hoping that one healthy steel company could emerge from two sick firms.

At first, the antitrust division opposed the merger, concluding that it could significantly hurt competition in the steel industry.

After LTV and Republic altered their plan to meet the division's objections (and after a political broadside from elsewhere in the Reagan administration), the deal was approved.

But to win approval, LTV had to agree to sell its Gadsden, Ala., steel plant.

Leaving the plant within the combined LTV-Republic companies would have been unfair to their competitors, the antitrust division concluded.

The question of who would buy the Gadsden plant has turned into a legal tug-of-war with the Justice Department uncomfortably in the middle.

A court-appointed trustee recommended in October that the Gadsden steel mill be sold to The Brenlin Group, a manufacturer and distributor of automotive axles and other industrial parts, with annual sales of $240 million.

According to the Justice Department, Brenlin has shown an ability to take over money-losing businesses, alter their operations and revive them.

The Gadsden plant, which is expected to lose $33 million this year, is very much in need of that kind of help.

At nearly the 11th hour, the Brenlin proposal was countered by one from LTV and the United Steelworkers Union members at the plant.

Their idea is to sell the plant to the employes through an Employee Stock Ownership Plan, an approach that typically hopes to blend wage and work-rule concessions by workers with federal tax breaks to bring a plant back to financial health.

The Justice Department initially concluded that of the two proposals, Brenlin's offered the best chance of working -- and thus the best chance of strengthening competition in the steel market.

The Brenlin plan would require LTV to shut Gadsden down immediately, before the sale. Brenlin would then be starting from scratch when it reopened the plant, not bound by LTV's current wage contracts with the steelworkers.

That would free Brenlin to reduce the number of employes and cut wages sharply, generating savings that it pledged to invest in modernizing the Gadsden plant.

The initial LTV-steelworkers ESOP proposal didn't pass muster with the antitrust division.

It would have required the new employe-owned plant to buy most of its iron ore pellets and coal from LTV at prices substantially higher than market prices, the antitrust division concluded.

The wage and work-force cuts proposed by LTV and the steelworkers were less than Brenlin planned.

And the steelworkers had agreed to give LTV an initial $23 million I.O.U. note immediately and another note in 1990 based on Gadsden's net worth then.

"Neither Brenlin nor any other purchaser would have paid anything like this for a plant that was losing money and was also in need of expensive capital improvements," said antitrust division attorney J. Robert Kramer II.

The Brenlin proposal was simply a better deal, with a higher chance of success, the antitrust division concluded.

With a Dec. 13 court hearing looming, LTV and the steelworkers hastily modified their plan to meet the division's objections, a switch that was also influenced by the worry that a victory for Brenlin would produce a strike at Gadsden.

But the modifications came too late to persuade Judge John H. Pratt, who ruled Friday that Brenlin should get the plant.

The steelworkers and LTV will appeal that decision, but at this point, the sale is expected to occur on Dec. 31.

The sale of the Gadsden plant probably wouldn't have been required under the new antitrust policy the Reagan administration has formulated, according to one official close to the process.

Mergers of the dimensions of the Republic-LTV combination wouldn't get an automatic stamp of approval under the new standard Reagan will propose, officials said.

But in industries hard-hit by imports, such mergers would have an easier time of it.

Whether that is good for the economy or not will be part of the debate next year.