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When Ford Motor Co. acquired Land Rover in June 2000 for $2.6 billion, the automaker had to notify more than a dozen governments around the world of the transaction. Never mind that Ford is based in the United States and Land Rover in the United Kingdom. Brazil had to be notified: It has a 30-day review that may be extended by any request for information. There are filing requirements in South Africa, Canada and Switzerland. And don’t forget Croatia. It also has a merger control regime. Ford, meanwhile, had to figure out which countries allow closing a deal before the review is complete. For instance, Brazil allows parts of the deal from outside the country to close while the United States, European Union and Switzerland do not. “This is a trap for the unwary,” Ford Motor counsel Stephen Bolerjack said. “It can be very expensive to get right given the timing involved.” A BETTER WAY Bolerjack thinks there must be a better way. Along with other executives who secure antitrust approvals for mergers, Bolerjack supports the International Competition Network, a group formed in October by the United States, the EU and other governments to harmonize merger control regimes. “The International Competition Network will enable our respective agencies to improve competition coordination and law enforcement to the benefit of consumers throughout the world,” Federal Trade Commission Chairman Timothy J. Muris said in unveiling the group at a ceremony at Fordham Law School in New York. The ICN is open to any national or regional competition authority. Corporations and the private bar are not part of the ICN, though the group’s charter says it will consult them frequently. It is easier to say what the ICN is not. It is not part of any other organization, such as the World Bank, World Trade Organization or the Organization for Economic Cooperation and Development. It also does not have a permanent staff or a headquarters. WHAT IS THE ICN? The ICN is a loose affiliation of competition authorities that will meet annually to discuss antitrust policy. The first forum is set for late September in Naples, Italy. Committees and subcommittees will conduct the work. Regulators launched the ICN with two committees: one for merger procedures, the other for competition advocacy. Creation of the ICN came at the height of the rhetorical fight between the United States and the EU over the General Electric Co.-Honeywell International Inc. merger, which was approved in the U.S. and rejected in Europe. One of the most vocal critics of the decision has been William Kolasky, the deputy assistant attorney general for international enforcement in the Justice Department’s antitrust division, who will be chairman of the ICN working group on merger convergence. “Among the competition authorities that have joined the network to this point, there is a high level of enthusiasm for it,” Kolasky said. “This is a real opportunity to make progress more quickly than in the past.” Don’t expect much to change quickly, though. Officials involved note that the ICN is geared more toward “soft convergence,” a belief that antitrust authorities will adopt similar policies if they work closely together. Examples of soft convergence include creating best practices and model laws. Hard convergence, on the other hand, would mean formally adopting common laws or forms. GROUPS WITHIN GROUPS The merger convergence group consists of three subgroups. One is focused on merger notifications and procedures, and its chairman is Randolph Tritell, a lawyer in the FTC’s competition bureau. “With some 60 jurisdictions having authority to review mergers, it is important to have a forum for agencies and representatives of business and other interests to discuss best practices for merger notification and review,” Tritell said. “The ICN would not seek harmonization, which is in any event unrealistic but will promote convergence on principles that members could implement in their domestic laws and regulations.” This subgroup is expected to present in September a series of best practices for merger notifications. These include the size thresholds that should trigger a notification, what types of deals should be covered, deadlines, filing fees, timing of the review, confidentiality and treating equally deals by domestic and foreign firms. The initial draft will be geared more at countries that are developing new codes. After that is released, the subgroup will examine the costs and benefits of the existing notification systems to identify which are most effective and impose the least costs on businesses. From that, the subgroup is expected to develop specific recommendations on how the countries with existing systems could implement improvements. Another subgroup, led by the United Kingdom, will study the analytical framework for merger decisions. The leading standard, used by the United States and other countries, is whether the deal would “substantially lessen competition.” The subgroup plans a panel discussion on the standard at the September meeting. The longer-term goal is to develop a model set of merger guidelines and study how efficiencies should be accounted for in merger evaluations. The final subgroup will study investigative techniques. Led by Israel, the subgroup will seek to educate countries with new merger control systems about what historically has been the most effective way to evaluate deals. This includes an emphasis on economic evidence. The subgroup is expected to work toward holding an international conference on merger enforcement next year. Less controversial than the three subgroups of the merger convergence working group will be the competition advocacy working group. Rowley said it will offer peer advice and encouragement to new competition agencies which often face stiff resistance to the imposition of antitrust programs. SUPPORT IS IMPORTANT “They can get battered,” Rowley said. “The ICN will provide more support to the new agencies.” The ICN enjoys broad support among antitrust lawyers, despite the failure of other efforts including bilateral talks and the undertaking of the Organization for Economic Cooperation and Development to produce significant convergence. Lawyers say this is because the private sector see the biggest problems as too much complexity and too much burden. “It is process run amok,” said John Nannes, a partner at Skadden, Arps, Slate, Meagher & Flom who spent the first half of 2000 as acting head of the antitrust division. “There are 50 to 100 merger regimes, and they are not uniform.” The ICN offers the hope of coalescing around a single approach to reforming pre-merger notification laws, Nannes said. “If that happens, it would be very positive for enforcement,” he said. Copyright (c)2002 TDD, LLC. All rights reserved.

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