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Antitrust and COVID-19

usinesses and institutions in many industries, including health care and life sciences, are considering ways to cooperate and collaborate in order to assist in addressing the public health crisis, as well as the economic crisis, caused by COVID-19 in the United States. Although these efforts – particularly among horizontal competitors – warrant assessing antitrust considerations, businesses can often engage in procompetitive collaboration with minimal or no antitrust risk. This Ropes & Gray alert sets forth some general principles, and provides an update on the recent Joint Statement by the Federal Trade Commission (“FTC”) and Antitrust Division of the Department of Justice (“DOJ”) dated March 24, 2020.

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FTC Announces Revised Thresholds for Interlocking Directorates


Time to Read: 1 minutes Practices: Antitrust

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The Federal Trade Commission has announced revised thresholds for interlocking directorates required under Section 8 of the Clayton Act (15 U.S.C. § 19(a)(5)). The revised thresholds took effect January 21, 2015

As revised, with certain exceptions, Section 8 prohibits a person from serving as a director or officer of two competing corporations (other than banks, banking associations, and trust companies) if each corporation has capital, surplus and undivided profits in excess of $31,084,000 (increased from $29,945,000) and the competitive sales of both corporations equal or exceed $3,108,400 (increased from $2,994,500). Note that a person shall not be prohibited from simultaneous service if the competitive sales of either corporation are less than 2 percent of its total sales or the competitive sales of each corporation are less than 4 percent of its total sales.

“Competitive sales” are defined as the gross revenues for all products and services sold by one corporation in competition with the other during its most recent fiscal year. “Total sales” are defined as gross revenues for all products and services sold by one corporation in the corporation's most recent fiscal year.

The question of whether any safe harbors apply in a given situation may be complex. If you have any questions regarding these changes, please feel free to contact a member of the antitrust practice group.

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