Overview
On December 11, the Federal Trade Commission and the Antitrust Division of the Department of Justice jointly announced that they had withdrawn the Antitrust Guidelines for Collaborations Among Competitors (Collaboration Guidelines), originally issued in April 2000. In the brief joint withdrawal statement accompanying the announcement, the agencies described the Collaboration Guidelines as being out-of-step with developments in the economy and major cases decided by the Supreme Court and other federal courts since their issuance over 24 years ago.
Whatever the ultimate merits of withdrawing the Collaboration Guidelines, the decision is another example of the Biden-era antitrust enforcement agencies' remarkable reluctance to provide guidance and predictability to US businesses seeking to avoid antitrust problems. It remains to be seen whether the incoming Trump Administration's antitrust enforcers will revert to their traditional role by seeking to educate the business community on their approach to law enforcement.
The agencies' withdrawal statement highlights that the agencies are "committed to vigorous antitrust enforcement on a case-by-case basis in the area of competitor collaborations because such collaborations can harm competition and subvert the competitive process," and specifically notes that "while some specific aspects of the Collaboration Guidelines may accurately reflect the state of the law," they "no longer provide reliable guidance to the public about how enforcers assess the legality of collaborations involving competitors."
It seems unlikely that the agencies' 11th-hour withdrawal of quarter-century-old guidelines will have substantial implications. For example, elimination of the "Antitrust Safety Zones" identified in the 2000 Collaboration Guidelines is likely to have little real effect. Notwithstanding the agencies’ claim that the Collaboration Guidelines "risk[ed] creating safe harbors that have no basis in federal antitrust statutes," neither the general safety zone (collaboration participants total less than 20% market in any affected relevant market) nor the innovation market safety zone (three or more independent non-participating research efforts are viable competitors to the collaboration) in the Collaboration Guidelines fall close enough to any realistic boundary between permissible and impermissible collaborations to justify significant concern. With or without formal Antitrust Safety Zones, most compliance advice to clients will remain the same. Additionally, as the agencies note, the rapid rise of AI, businesses’ increasing use algorithmic pricing, and the evolution of business strategy and economic theory, together suggest that guidelines issued near the beginning of the Internet Age might not provide reliable guidance for the modern economy.
Even so, analysis under the 2000 Collaboration Guidelines has always been highly fact-specific, and parties considering a competitor collaboration have thus always been best served by seeking individualized advice before entering into any new arrangement. In that sense, too, little has changed – businesses contemplating any such arrangement should still obtain reliable legal advice before jumping into any collaborative effort with a competitor.
