Uncertainty surrounds concerted practice

Author: IFLR Correspondent | Published: 12 Oct 2017
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By Karry Lai

Uncertainty continues to surround the definition of a concerted practice when competitors discuss information on pricing.  Where should parties draw the fine line between a concerted practice, an agreement, and an understanding? The answer appears to be a nuanced one.

In yesterday’s session 'Antitrust after cartels: next generation enforcement’, panellists offered global perspectives from enforcement, in-house counsel and private practitioner angles on issues of enforcement when it is uncertain whether competitor coordination falls short of being a cartel.

Governments in a number of jurisdictions have policies in the pipeline to target the issue of concerted practices. Australia’s Competition and Consumer Amendment (Competition Policy Review) Bill 2017 is expected to be passed in the next few weeks, according to Sarah Court from the Australian Competition and Consumer Commission.

"At the moment it is frustrating for regulators when we can’t act on the information," said Court. "From a regulator’s perspective, communication between competitors on information on pricing…and whether competitors acted on [it] are all evidence that will be looked at." 

Information disclosure  

Panellists highlighted the potential for information disclosure to be constituted as concerted practice.  "In this day and age, information exchange through social media is especially concerning with text messaging and apps," said Mika Clark from United Airlines in the US. In a recent example, the Department of Justice (DOJ) brought a civil antitrust case against DIRECTV for improper exchange of information through text messaging.


  • Competition regulators around the world are increasingly concerned about concerted practices;
  • Issues surrounding information exchange need to be fleshed out to provide more clarity for businesses and the legal community as current regulation is often not clear-cut;
  • Businesses need to be cautious of how they participate in information disclosure and exchange with competitors to avoid breaching anti-competition laws.

"If it’s an email on a competitor’s pricing and a client has seen the material, it would be wise to email the person back telling them that they do not want to receive the information so that there is at least a record," said Carolyn Oddie, partner at Allens, Australia.

"Information disclosure by competitors isn’t always anti-competitive and may even have benefits for consumers, suppliers, investors and help competitors to compete," said Heather Irvine, director at Falcon & Hume, South Africa. "But there is a nuanced assessment of the circumstances of information."

Factors that come into play are the structure of the market such as the number of competitors and the stability of the market; the characteristics of information such as whether it is aggregated; and the modality of disclosure. This can include whether the discussion was a private conversation or public disclosure.

"It is frustrating for regulators when we can't act on the information"

"The EU courts have indicated that public distancing is not the only way and that electronic communication is sufficient to be considered as distancing, so the public disclosure element becomes less crucial," said Rein Wesseling, partner at Stibbe in the Netherlands. "The EU has provided for safe harbours if the information collected is at least three months old."

Surveys and data benchmarking in businesses can have pro-competitive aspects through best performance metrics, but they could bring into question whether they are affecting competition in the market.

An example of survey guidelines is the US’ Department of Justice/Federal Trade Commission’s Policy in Health Care (1996) for data on people in employment. "From an employment practice perspective, the information exchange may be lawful if a neutral third party manages the information, the information is not recent, the information is aggregated to protect the identity of the individuals, and there is enough data to prevent the linking of data to an individual source," said Clark.

"One needs to ask: what is the information needed for?" said Irvine. "If the client cannot articulate a genuine requirement to collect information other than to dampen competition, there is no reason to do it."