June Antitrust Bulletin

June 24, 2011

DOJ Issues New Merger Remedy Guide

On June 17, 2011, the U.S. Department of Justice (DOJ) issued an updated version of the Antitrust Division’s Policy Guide to Merger Remedies, to recognize “changes in the merger landscape” and the recent creation of the Office of the General Counsel, which will be responsible for enforcing consent decrees. The policy guide, which revises guidance originally issued in 2004, offers clear guidance for companies who may have deals reviewed by DOJ. In particular, the guide states that while DOJ continues to rely predominantly on structural remedies, conduct remedies may also be utilized, particularly in vertical mergers. This change to the vertical mergers section of the policy guide was foreshadowed by some of DOJ’s recent cases, including the Ticketmaster Entertainment Inc.-Live Nation Inc. and Comcast Corp.-NBC Universal mergers.

New Merger Regulations Go into Effect in India

New antitrust rules went into force in India on June 1, 2011, giving the Competition Commission jurisdiction to review “combinations” that meet certain financial thresholds. Transactions which ordinarily are not likely to cause an appreciable adverse effect on competition in India are likely to be exempt from the filing requirements. Though the Commission has set a target of reviewing most transactions within 30 days, the new rules provide for a review period of seven months.

DOJ Settles Challenge to Sale of Chicken Processing Plant

On June 23, 2011, the DOJ announced a settlement with George’s, Inc, a chicken processor, that requires the company to make capital improvements to the Harrisonburg, Va. chicken processing plant it acquired from Tyson’s Foods to enhance the company’s ability to increase local poultry production. DOJ had challenged the transaction—which was not reportable under the premerger notification requirements of the Hart-Scott-Rodino Act—alleging that the acquisition eliminated substantial competition between the two companies for the procurement of services of chicken growers in the Shenandoah Valley area. This was the latest in a series of challenges to consummated mergers by federal antitrust agencies, and the second such challenge in the agriculture sector since January 2010.

EU Holds Parent Company Liable for Anticompetitive Conduct of Subsidiary

In recent judgments involving the Elf Aquitaine group, the EU General Court confirmed that there is a rebuttable presumption that a subsidiary wholly-owned by a parent company does not freely determine its own conduct on the market. Accordingly, breaches of competition law by the subsidiary can be imputed to the parent company. Additional information appears in our June 2011 EU/UK Competition Newsletter.

For more information, please contact the lawyers in the Antitrust & Trade Regulation Department at McGuireWoods.