Antitrust Agencies Release Annual Reports
On April 1, 2011, the Federal Trade Commission (FTC) and the U.S. Department of Justice's (DOJ) Antitrust Division issued their annual reports. The
FTC report describes the Commission's accomplishments during the previous year, including its litigation in the healthcare industry, revisions to the Horizontal
Merger Guidelines issued jointly by the FTC and DOJ that provide more clarity and predictability for businesses, its report on privacy issues that
proposes a framework for balancing consumer privacy with industry innovation, and its efforts to combat cross-border fraud by using the
information-sharing provisions of U.S. SAFE WEB Act of 2006. The
DOJ newsletter highlights the Antitrust
Division's enforcement actions over the past year, including the filing of 60 criminal cases and obtaining fines in excess of $550 million against
corporations and individuals, as well as its competition advocacy initiatives, including its activities
relating to the agriculture industry.
Agencies Release Draft Guidance for ACOs
On March 31, 2011, the FTC and DOJ released a joint Proposed Statement of Antitrust Enforcement Policy governing accountable care
organizations (ACOs) under the Patient Protection and Affordable Care Act. The Affordable Care Act contemplates that ACOs – networks of healthcare
providers sharing responsibility for patients – would manage the healthcare needs of Medicare beneficiaries and, potentially, those of commercially
The agencies' recent guidance addresses the antirust implications of competing providers collaborating within an ACO by, among other things, applying a
rule of reason analysis to activity by qualifying ACOs, establishing an antitrust "safety zone" for ACOs with a combined share of 30% or less of each
common service within the primary service area, and providing guidance concerning agency review of ACOs that fall outside the safety zone.
Public comments on the proposed rules will
be accepted through May 31, 2011. Additional information is available from McGuireWoods
SEC Charges Brokerage Executives for Failing to Protect Confidential Customer Information
On April 7, 2011, the Securities and Exchange Commission (SEC) charged three former brokerage executives with failing to protect confidential
information about their customers. According to the SEC, the executives improperly transferred customer records to another firm during the winding
down of their company's business operations. The record transfer violated Regulation S-P of the Securities Exchange Act (the Safeguard Rule) because
the customers were not notified in advance and given reasonable time to opt out. This marks the first time the SEC has assessed financial penalties
against individuals charged solely with violations of Regulation S-P.
Ban on Online Distributor Sales Not Permitted in EU
An advocate general (adviser) to the European Court of Justice recently opined that an absolute ban on Internet sales by a distributor will usually be
an automatic infringement of EU competition law. Though this opinion was given in the context of selective distribution agreements, the same principle
would apply to such a restriction included in other types of vertical (supplier/purchaser) agreements, such as exclusive distribution agreements.
Additional information is available in our
April 2011 EU/UK Competition Law Newsletter.
For more information, please contact the lawyers in the
Antitrust & Trade Regulation Department at McGuireWoods.