U.S. and Canada Sign Agreement to Provide For Enhanced International Antitrust Cooperation

Representatives of the United States and Canada today signed an agreement enhancing the process under which they will refer cases of anticompetitive activities to each other’s authorities for appropriate law enforcement action. Federal Trade Commission Chairman Deborah Platt Majoras and U.S. Attorney General John Ashcroft represented the United States and Canadian Ambassador to the United States, Michael Kergin, represented Canada at the signing ceremony.

Also attending the signing ceremony were Susan Creighton, Director of the FTC’s Bureau of Competition, FTC General Counsel William E. Kovacic, R. Hewitt Pate, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division, and Sheridan Scott, Commissioner of Canada’s Competition Bureau.

“Today’s agreement builds on the strong cooperative relationship between the U.S. and Canadian antitrust authorities,” said Chairman Majoras. “The agreement seeks to promote our shared goal of more efficient and effective enforcement in certain cross-border cases, based on the high level of trust and confidence between our agencies.”

Positive comity agreements, such as the agreement signed today, allow antitrust enforcers in one country to request that the other country’s antitrust agency investigate and take appropriate law enforcement action against anticompetitive conduct that adversely affects the interests of the country requesting the investigation and violates the laws of the country responding to the request. The agreement signed today builds on the positive comity provision in the 1995 antitrust enforcement cooperation agreement between the U.S. and Canada, and provides for more efficient application of the two countries’ enforcement resources.

The agreement signed today is very similar to the agreement signed by the U.S. and the European Communities in 1998, and establishes conditions under which the requesting country will normally agree to defer initiating its own enforcement activity. The enhanced agreement aims to reduce the likelihood of duplicate enforcement actions in cases where positive comity requests are made. Nothing in the agreement, however, prohibits the party making the request from bringing its own enforcement action if the requesting party believes doing so is necessary to protect consumers in its country.

The new agreement identifies the types of cases one party will normally refer to the other and lists the obligations the competition authorities will undertake in handling these cases. Specifically, the agreement, in cases where it is invoked, provides that the “requesting” party will defer or suspend its enforcement activities in favor of a positive comity referral to the other country in cases where the foreign anticompetitive activities do not directly or principally affect the requesting party’s consumers.

Under the agreement, each side pledges to devote its best efforts and resources to investigate referred matters and inform the other side’s competition authorities on the status of the cases resulting from a referral. Both sides also have agreed that some circumstances will justify parallel investigations – although neither side waives its authority to initiate its own antitrust enforcement actions. Additionally, the new agreement does not apply to merger or cartel investigations. Finally, the agreement stipulates that confidential information may be shared only where the source of the information has consented.

Copies of the agreement are available from the FTC’s Web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC’s Bureau of Competition seeks to prevent business practices that restrain competition. The Bureau carries out its mission by investigating alleged law violations and, when appropriate, recommending that the Commission take formal enforcement action. To notify the Bureau concerning particular business practices, call or write the Office of Policy and Evaluation, Room 394, Bureau of Competition, Federal Trade Commission, 600 Pennsylvania Ave., N.W., Washington, D.C. 20580, Electronic Mail: antitrust@ftc.gov; Telephone (202) 326-3300. For more information on the laws that the Bureau enforces, the Commission has published Promoting Competition, Protecting Consumers: A Plain English Guide to Antitrust Laws, which can be accessed at http://www.ftc.gov/bc/compguide/index.htm.