Global Competition Law is primarly a practitioner's guide presenting the most salient aspects of the major competition laws country by country, giving an overview of their structure and most charasteristic elements.
Global Competition Law also provides insight into possible future developments in the field.

Global Competition Law

Retroactive remedies under Section 7 of the Clayton Act include forced divestiture of acquired stock or assets, corporate spin-offs, the compulsory purchase of or sale of needed materials to a divested firm, the compulsory sharing of technology, and temporary restrictions on the defendant's output.
In September 2020, the DoJ issued revised guidelines on merger remedies (the Merger Remedies Manual) …

Divestiture of assets

  The civil remedies available under Section 7 of the Clayton Act include a permanent injunction prohibiting a pending merger or acquisition.

Injunctions

Retroactive remedies under Section 7 of the Clayton Act include forced divestiture of acquired stock or assets, corporate spin-offs, the compulsory purchase of or sale of needed materials to a divested firm, the compulsory sharing of technology, and temporary restrictions on the defendant's output.

In September 2020, the DoJ issued revised guidelines on merger remedies (the Merger Remedies Manual) to provide guidance to Antitrust Division staff in their work analyzing proposed remedies for mergers and detailing the basic principles they should implement. The DoJ revised its previous 2011 guidelines to address criticism over a marked preference for conduct remedies. The new manual reflects the DoJ's change of policy: a renewed focus on enforcing obligations in consent decrees and a strong commitment to effective structural relief. 

Pursuant to the manual, structural remedies should be strongly preferred in horizontal and vertical merger cases because they are “clean and certain, effective, and avoid ongoing government regulation of the market”. Conduct remedies are now regarded appropriate in limited circumstances only: (1) where they facilitate structural relief, or (2) where significant efficiencies would be lost through a structural divestiture, if the  conduct remedy would completely cure the competitive harm, and if it  can be enforced effectively. Key principles apply to structuring and implementing remedies in both horizontal and vertical merger cases: i) remedies must preserve competition; ii) they should not create ongoing government regulation of the market; iii) temporary relief should not be used to remedy persistent competitive harm; iv) the remedy should preserve competition, not protect competitors; v) the risk of a failed remedy should fall on the merging parties, not on consumers; and vi) the remedy must be enforceable.

The Merger Remedies Manual describes how the Antitrust Division will ensure that consent decrees are effectively implemented and highlights the role of the newly created Office of Decree Enforcement and Compliance (ODEC), which supervises the Antitrust Division’s decree compliance efforts.

Structural remedies include: i) divestiture of all assets necessary for the purchaser to be an effective, long-term competitor - in such case, the agency will require the parties to provide an “up-front” buyer for the divested assets, and to include “crown jewel” provisions, which provide that unless the original package is divested in the time allotted, the assets to be divested will expand to include other attractive assets - ; or ii) divestiture of an existing business entity that already has demonstrated its ability to compete in the relevant market and divestiture of rights to critical intangible assets, i.e. sale or licensing of IP rights.

The most common conduct remedies are: (i) firewall provisions, designed to prevent the dissemination of information within a firm; (ii) non-discrimination clauses; (iii) mandatory licensing; (iv) transparency provisions requiring the merged firm to make certain information available to a regulatory authority; (v) anti-retaliation provisions either against customers or other parties who enter into (or contemplate entering into) contracts or who do business with the merged entity's competitors or against an entity for providing information to the DoJ about alleged non-compliance with a decree or for invoking any of the provisions of a decree or a regulatory agency's rule or order; and (vi) prohibitions on certain contractual practices.

Remedies agreed by the DoJ are set out in consent decrees issued by the District Court. Remedies agreed by the FTC are set out in consent orders issued by the FTC itself.

Failure to comply with any provision of teh Act may result in a civil penalty of up to US$ 43,280 for each day of violation. Violation of any order of the FTC may result in a civil penalty of US$ 5,000 per violation.

Where there is a failure to substantially comply with the pre-merger notification requirement, or with requests for further information within the waiting period, the District Court may order compliance, extend the waiting period, and grant such other equitable relief as is necessary.

Taking action to consummate the merger prior to waiting period expiration, known as “gun jumping”, may likewise be subject to penalties.

Global Competition Law

1492. Divestiture of assets

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Les notions juridiques connexes

1492. Divestiture of assets

Demandez un accès gratuit au contenu exclusif Livv – juristes d’entreprise

Les notions juridiques connexes

Demandez un accès gratuit
au contenu exclusif Livv – juristes d’entreprise