ACE NY Antitrust Guidelines

Alliance for Clean Energy New York, Inc.

Antitrust Guidelines

Introduction:

One of the major goals of the Alliance for Clean Energy New York, Inc. (ACE NY) is to create an environment where industry members can meet and share information with the understanding that ACE NY activities will be conducted in accordance with applicable antitrust laws. ACE NY recognizes that antitrust laws preserve and foster competition, and ACE NY is committed to a policy that requires strict compliance with both the letter and spirit of these laws. Accordingly, ACE NY has adopted the following Antitrust Guidelines to be used by its members and staff in conducting ACE NY activities. The purpose of these guidelines is to assist ACE NY, its employees and members not only to avoid violations of antitrust laws, but to prevent any appearance of violation.

Application of Antitrust Laws to ACE NY Activities:

ACE NY understands that its activities are subject to scrutiny under the antitrust laws because it provides a forum where competitors gather and could have an opportunity to share information about the way they conduct their business. Therefore, ACE NY and its members and staff must act carefully and cautiously in the way they conduct their activities to ensure they fully comply with all laws and do not create situations that could be in any way construed as violations of antitrust laws.

Activities Strictly Forbidden by Antitrust Laws:

The following activities are strictly forbidden by antitrust laws and therefore, any activities that involve or give the appearance of involving these activities, are prohibited by ACE NY members.

Price Fixing. Any agreement among competitors about the price or the elements of pricing that they charge customers is price fixing. Price fixing may exist even if there is no specific or explicit agreement regarding the price to be charged. Any agreement among competitors that will affect the price to be charged can be price fixing. For example, agreements among competitors regarding credit terms, discounts or shipping charges will affect the price charged to customers and will therefore be considered anti-competitive in nature and a violation of antitrust laws. Competitors should scrupulously avoid discussing prices or the components of pricing (including costs) and need to be aware that because any agreement affecting pricing is considered an inherent (“per se”) violation of antitrust laws, those charged with a violation will not be permitted to justify the agreement by showing that it ultimately benefited customers.

Bid Rigging. The object of bid-rigging is to reduce competition and ensure that industry members get higher prices and a higher or guaranteed share of the market. The kind of activities that constitute bid-rigging are: sharing information with the understanding that one party will be the low bidder; submitting “complementary bids” at the request of a competitor with the understanding that this bid will be higher; agreeing with a competitor not to bid on a specific project.

Customer Allocation. Agreements to divide and allocate markets among various competitors are also deemed to be violations of the antitrust laws. Agreements not to pursue a competitor’s customers, or an agreement not to pursue a category of customer commonly served by a competitor, also fit into the category of customer allocation schemes.

Territorial Market Allocation. Agreements to allocate customers on the basis of the geographic location of the customer or the market are also violations of antitrust laws. Agreements among competitors not to enter markets based on geographical boundaries also fit into this category and are strictly illegal.

Group Boycotts. A group boycott exists when competitors agree not to do business with, or agree to take some kind of joint action, such as deny credit, against a competitor or a customer. Such actions are considered to be anti-competitive in nature and represent a clear violation of antitrust laws.

Agreement to Control or Limit Supply. Any agreement or understanding between competitors to restrict the volume of goods or service they will produce or make available for sale is illegal.

Tying Arrangements. Certain agreements imposed by a seller who enjoys a substantial market position that its sale of one product or service compels the buyer also to purchase a different (or tied) product or service may be illegal.

Association Efforts to Influence Government Actions. The Supreme Court has held that the Sherman Antitrust Act is inapplicable to bona fide group efforts to influence legislative action. Subsequent lower court decisions have extended this privilege (known as the Noerr-Pennington doctrine) to include influencing other governmental agencies besides legislative bodies, but have left its boundaries somewhat uncertain. There are limits on this protection, and care must be taken as to the scope of any collaborative approach to governmental agencies.

Activities with Potential to Result in Violations of Antitrust Laws:

The following activities have the potential to result in a violation of antitrust laws and, therefore, any ACE NY activities that involve or give the appearance of involving these activities must be approved in advance so that ACE NY can engage outside legal counsel to confirm whether the activities are permissible.

Standard Setting. Product standard setting and development refers to the process of identifying and agreeing upon a specific set of criteria to which a product should conform. Standard setting can create antitrust violations if the criteria have an effect of limiting or eliminating certain products or competitors from the marketplace. Standard setting is a legal activity that can be engaged in provided that it is done in a way that provides interested parties with the opportunity to participate in the development and implementation of the standard.

Information Exchanges. Sharing non-public information can cause antitrust problems if not structured properly. Information sharing programs must be structured in ways that do not disclose pricing strategies, market share or other areas that could create or provide the inference of creating illegal restraints on trade. In light of this, the following topics may not be discussed among ACE NY members:

  • Information not publicly available with respect to customers, suppliers, or

  • other competitors;

  • Prices, pricing or methods of calculating prices, or the timing of price

  • changes;

  • Costs of products or services, margins or discounts;

  • Any terms and conditions of sale or purchase (e.g., credit terms, payment

  • terms, promotion programs, discounts, service charges, delivery terms);

  • Decisions to quote or not to quote on products, components, spare parts, or

  • services;

  • Sales territories;

  • Product or service offerings;

  • Sales volumes, production capacity or volume;

  • Market shares; and

  • Non-public investment decisions, and research and development spending.

Antitrust Operating Guidelines:

1. The ACE NY Antitrust Guidelines will be disseminated to all members in conjunction with their annual membership renewal.

2. The ACE NY Antitrust Guidelines will be posted in the member-only section of the web site.

3. Agendas will be prepared in advance of all Committee or Working Group meetings. Agendas should be strictly followed; there should be no deviations, particularly insofar as subjects described above might be discussed. During meetings, participants should conduct themselves as thought the meeting were open to the public.

4. Minutes will be kept at all Board of Director meetings and will note that attendees were reminded at the beginning of the meeting of the ACE NY Antitrust Guidelines. If appropriate, a copy of the ACE NY Antitrust Guidelines should be included with the minutes.

5. The minutes will be prepared by a designated ACE NY staff member. Minutes will be reviewed by the Board members prior to adoption and distribution to insure that antitrust sensitive discussions are properly documented.

6. ACE NY shall seek legal counsel when needed to ensure that ACE NY complies with relevant antitrust laws.

7. ACE NY will adopt a formal record retention policy.