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Responding to criticism that the merger review process is costly and time-consuming, the Federal Trade Commission on Wednesday revamped its policies for how corporations collect and turn over documents the agency uses to investigate deals. Among the new initiatives to modify the FTC’s premerger notification and second-request policies: reducing archive searches, eliminating the requirement that each document be linked to a specific paragraph in the second request, permitting firms to retrieve privileged documents accidentally disclosed to the agency and giving the parties copies of investigatory transcripts. “This is great,” said Jonathan Jacobson, a partner at Akin, Gump, Strauss, Hauer & Feld in New York. “This necessarily will reduce the amount of effort required geometrically.” FTC Competition Bureau Director Joe Simons said the new policies are the result of a nine-month review of the premerger notification process that included forums with antitrust lawyers across the country. “The changes we are announcing today we designed to streamline our processes, increase our efficiency and reduce the burden on the parties,” Simons said at a conference sponsored by the Charles River Associates consulting firm. Because they are expensive to conduct, archive searches have brought many complaints from the business community. Simons said the FTC will seek to eliminate its requests for searches of paper archives and back-up computer tapes. When that is not possible, it will limit the request to specific individuals and specific time periods, he said. The FTC also broadened its privilege rule, which applies to documents that do not have to be given to the agency, typically because of a so-called privilege such as attorney-client work product. The agency had said a company waives its privilege rights if it inadvertently discloses a document. Under the new policy, companies will be permitted to retrieve inadvertently disclosed documents without penalty. Simons said the agency looked to eliminate requirements it imposes on parties that do little to aid the agency’s review. For instance, he said companies would have to pay for a lawyer to take detailed notes every time staff interviewed a corporate official. This was because the agency refused to provide copies of the transcripts of the interviews to the companies. “We will now turn over those transcripts,” he said. Simons said the FTC will only require in limited circumstances so-called second sweeps, which require the company to research offices for documents. The agency will assume such second sweeps are not normally necessary and when it does require them it will limit the sweep to no more than five executives. The FTC also wants to encourage companies to submit second-request documents to the agency electronically. Simons said the agency is not yet proposing how this should be done, saying it would prefer to experiment with various alternatives before offering more guidance. Companies will be free to either use so-called term searches to find relevant documents electronically or to manually review the records. Simons said both methods will be treated equally. Copyright �2002 TDD, LLC. All rights reserved.

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