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1410235

UNITED STATES OF AMERICA

BEFORE THE FEDERAL TRADE COMMISSION

COMMISSIONERS: Edith Ramirez, Chairwoman

Julie Brill

Maureen K. Ohlhausen

Joshua D. Wright

Terrell McSweeny

 

 )

In the Matter of )

 )

 )

ZF Friedrichshafen AG, )

a corporation; and, )

 ) Docket No. C-4520

 )

 )

TRW Automotive Holdings Corp., )

a corporation. )

 )

 ) 

ORDER TO HOLD SEPARATE AND MAINTAIN ASSETS

[Public Record Version]

The Federal Trade Commission (“Commission”), having initiated an investigation 

of the proposed acquisition by ZF Friedrichshafen AG (“ZF”) of TRW Automotive 

Holdings Corp. (“TRW”), hereinafter referred to as “Respondents,” and Respondents 

having been furnished thereafter with a copy of a draft of Complaint that the Bureau of 

Competition proposed to present to the Commission for its consideration and which, if 

issued by the Commission, would charge Respondents with violations of Section 7 of the 

Clayton Act, as amended, 15 U.S.C. § 18, and Section 5 of the Federal Trade 

Commission Act, as amended, 15 U.S.C. § 45; and

Respondents, their attorneys, and counsel for the Commission having thereafter

executed an Agreement Containing Consent Orders (“Consent Agreement”), containing 

an admission by Respondents of all the jurisdictional facts set forth in the aforesaid draft 

of Complaint, a statement that the signing of said Consent Agreement is for settlement 

purposes only and does not constitute an admission by Respondents that the law has been 

violated as alleged in such Complaint, or that the facts as alleged in such Complaint, 

other than jurisdictional facts, are true, and waivers and other provisions as required by 

the Commission’s Rules; and 
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The Commission having thereafter considered the matter and having determined 

that it had reason to believe that Respondents have violated the said Acts and that a 

Complaint should issue stating its charges in that respect, and having determined to 

accept the executed Consent Agreement and to place such Consent Agreement containing 

the Decision and Order on the public record for a period of thirty (30) days for the receipt 

and consideration of public comments, now in further conformity with the procedure 

described in Commission Rule 2.34, 16 C.F.R. § 2.34, the Commission hereby issues its 

Complaint, makes the following jurisdictional findings, and issues the following Order to 

Hold Separate and Maintain Assets (“Hold Separate Order”):

1. Respondent ZF Friedrichshafen AG is a stock corporation organized, existing and 

doing business under and by virtue of the laws of the Federal Republic of Germany, with 

its office and principal place of business located at Friedrichshafen, Germany. 

2. Respondent TRW Automotive Holdings Corp. is a public corporation organized, 

existing and doing business under and by virtue of the laws of the State of Delaware, with 

its office and principal place of business located at 12001 Tech Center Drive, Livonia, MI 

48150. 

3. The Federal Trade Commission has jurisdiction over the subject matter of this 

proceeding and of Respondents, and this proceeding is in the public interest.

ORDER

I.

IT IS ORDERED that, as used in this Hold Separate Order, the following 

definitions, and all other definitions used in the Consent Agreement and the Decision and 

Order, shall apply: 

A. “Decision and Order” means: 

1. the Proposed Decision and Order contained in the Consent Agreement in 

this matter until issuance and service of a final Decision and Order by the 

Commission; and 

2. the Final Decision and Order issued and served by the Commission.

B. “EC Decision” means Case M.7420 – ZF/TRW Commission decision pursuant to 

Article 6(1)(b) in conjunction with Article 6(2) of Council Regulation No 

139/2004 and Article 57 of the Agreement on the European Economic Area

issued on March 12, 2015.

C. “Hold Separate Business” means the TRW L&S Business. 
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D. “Hold Separate Business Employee” means any employee or agent of the Hold 

Separate Businesses (other than a Support Services Employee).

E. “Hold Separate Order Date” means the date this Hold Separate Order is issued.

F. “Hold Separate Period” means the period from the Acquisition Date until the 

Divestiture Date. 

G. “Orders” means the Decision and Order and this Hold Separate Order.

H. “Support Services Employee” means any employee, agent, contractor, or 

consultant of Respondents performing Support Services, including, but not 

limited to, the Persons identified in Confidential Appendix B to this Hold 

Separate Order.

I. “Support Services” means assistance with respect to the operation of the TRW 

L&S Business, including, but not limited to: (i) human resources and 

administrative services such as payroll processing and employee benefits; (ii) 

preparation of tax returns, environmental health and safety services; (iii) financial 

accounting and reporting services; (iv) legal, licensing, and audit services; (v) 

licensing and regulatory compliance in any jurisdiction in which it does business; 

(vi) maintenance and oversight of information technology systems and other 

computerized or electronic systems and databases; (vii) processing of accounts 

payable and accounts receivable; (viii) procurement services; (ix) public relations 

and public affairs services; (x) construction and development services; (xi) safety 

and security services; and (xii) procurement and renewal of insurance and related 

services. Support Services includes any assistance provided to the TRW L&S 

Business at any time within twenty four (24) months prior to the commencement 

of the Hold Separate Period, and in addition, any other assistance or support 

reasonably required during the Hold Separate Period to achieve the purposes of 

this Hold Separate Order and the Decision and Order.

J. “Tillsonburg Production Line Transfer Expenditures” means all budgeted, 

planned, or approved expenditures and funding as of the Hold Separate Order 

Date that are necessary for or related to the timely completion of the transfer of 

the Tillsonburg Production Line as set forth in Confidential Appendix A to this 

Hold Separate Order.
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II.

IT IS FURTHER ORDERED that during the Hold Separate Period: 

A. Respondents shall:

1. Keep the Hold Separate Business separate, apart, and independent of 

Respondents’ other businesses and assets as required by this Hold Separate 

Order and shall vest the Hold Separate Business with all rights, powers, 

and authority necessary to conduct its business;

2. Not exercise direction or control over, or influence directly or indirectly, 

the Hold Separate Business or any of its operations, or the Hold Separate 

Monitor, except to the extent that Respondents must exercise direction and 

control over the Hold Separate Business as is necessary to assure 

compliance with this Hold Separate Order, the Consent Agreement, the 

Decision and Order, the EC Decision, and all applicable laws; and

3. Take all actions necessary to maintain and assure the continued viability, 

marketability, and competitiveness of the Hold Separate Business, and 

prevent the destruction, removal, wasting, deterioration, or impairment of 

any of the assets of the Hold Separate Business, except for ordinary wear 

and tear, and shall not sell, transfer, encumber, or otherwise impair any of 

the assets of the Hold Separate Business or the Hold Separate Business 

(except as required by the Decision and Order).

B. The purpose of this Hold Separate Order is to (1) maintain and

preserve the Hold Separate Business as a viable, competitive, and ongoing 

business independent of Respondents until the divestitures required by the 

Decision and Order are achieved; (2) assure that no Material Confidential 

Information is exchanged between Respondents and the Hold Separate Business, 

except in accordance with the provisions of this Hold Separate Order; and (3) 

prevent interim harm to competition pending the divestiture and other relief.

III.

IT IS FURTHER ORDERED that:

A. The Commission appoints Competition Rx as Hold Separate Monitor to

monitor and supervise the management of the Hold Separate Business and 

ensure that Respondents comply with their obligations under this Hold 

Separate Order and the Decision and Order.
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B. Respondents shall enter into the agreement with the Hold Separate Monitor, 

attached as Appendix C to this Hold Separate Order, that shall become effective no 

later than one (1) day after the date the Acquisition is completed, and that 

transfers to and confers upon the Hold Separate Monitor all rights, powers, and 

authority necessary to permit the Hold Separate Monitor to perform his or her 

duties and responsibilities pursuant to this Hold Separate Order in a manner 

consistent with the purposes of this Hold Separate Order and the Decision and 

Order and in consultation with Commission staff; and shall require that the Hold 

Separate Monitor act in a fiduciary capacity for the benefit of the Commission:

1. The Hold Separate Monitor shall have the responsibility for monitoring the 

organization of the Hold Separate Business; supervising the management 

of the Hold Separate Business by TRW Key Employees; maintaining the 

independence of the Hold Separate Business; and monitoring 

Respondents’ compliance with their obligations pursuant to this Hold 

Separate Order and the Decision and Order.

2. The Hold Separate Monitor shall act in a fiduciary capacity for the benefit 

of the Commission. Subject to all applicable laws and regulations, the 

Hold Separate Monitor shall have full and complete access to all 

personnel, books, records, documents, and facilities of the Hold Separate 

Business, and to any other relevant information as the Hold Separate 

Monitor may reasonably request including, but not limited to, all 

documents and records kept by Respondents in the ordinary course of 

business that relate to the Hold Separate Business. Respondents shall 

develop such financial or other information as the Hold Separate Monitor 

may reasonably request. 

3. The Hold Separate Monitor shall have the authority to employ, at the cost 

and expense of Respondents, such consultants, accountants, attorneys, and 

other representatives and assistants as are reasonably necessary to carry 

out the Hold Separate Monitor’s duties and responsibilities. 

4. The Commission may require the Hold Separate Monitor and each of the 

Hold Separate Monitor’s consultants, accountants, attorneys, and other 

representatives and assistants to sign an appropriate confidentiality 

agreement relating to materials and information received from the 

Commission in connection with performance of the Hold Separate 

Monitor’s duties. 

5. Respondents may require the Hold Separate Monitor and each of the Hold 

Separate Monitor’s consultants, accountants, attorneys, and other 

representatives and assistants to sign an appropriate confidentiality 

agreement; provided, however, that such agreement shall not restrict the 

Hold Separate Monitor from providing any information to the 

Commission.
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6. The Hold Separate Monitor shall serve, without bond or other security, at 

the cost and expense of Respondents, on reasonable and customary terms 

commensurate with the person’s experience and responsibilities.

7. Respondents shall indemnify the Hold Separate Monitor and hold it 

harmless against any losses, claims, damages, liabilities, or expenses 

arising out of, or in connection with, the performance of the Hold Separate 

Monitor’s duties, including all reasonable fees of counsel and other 

expenses incurred in connection with the preparation for, or defense of, 

any claim, whether or not resulting in any liability, except to the extent 

that such losses, claims, damages, liabilities, or expenses result from the 

Hold Separate Monitor’s malfeasance, gross negligence, willful or wanton 

acts, or bad faith.

8. Thirty (30) days after the date the Acquisition is completed, and every 

thirty (30) days thereafter until the Hold Separate Order terminates, the 

Hold Separate Monitor shall report in writing to the Commission

concerning the efforts to accomplish the purposes of this Hold Separate 

Order and Respondents’ compliance with their obligations under the Hold 

Separate Order and the Decision and Order. 

C. If the Hold Separate Monitor ceases to act or fails to act diligently and 

consistent with the purposes of this Hold Separate Order or with the EC 

Decision, the Commission may appoint a substitute Hold Separate Monitor, 

subject to the consent of Respondents, which consent shall not be

unreasonably withheld, as follows:

1. If Respondents have not opposed in writing, including the reasons 

for opposing, the selection of the proposed substitute Hold Separate 

Monitor within five (5) business days after notice by the staff of the 

Commission to Respondents of the identity of the proposed 

substitute Hold Separate Monitor, then Respondents shall be 

deemed to have consented to the selection of the proposed 

substitute Monitor.

2. Respondents shall, no later than five (5) days after the Commission 

appoints a substitute Hold Separate Monitor, enter into an 

agreement with the substitute Hold Separate Monitor that, subject to 

the approval of the Commission, confers on the substitute Hold 

Separate Monitor all the rights, powers, and authority necessary to 

permit the substitute Hold Separate Monitor to perform, its, his, or 

her duties and responsibilities on the same terms and conditions as 

provided in Paragraph III. of this Hold Separate Order.
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D. The Hold Separate Monitor shall serve through the Hold Separate Period; 

provided, however, that the Commission may extend or modify this period 

as may be necessary or appropriate to accomplish the purposes of the 

Orders.

E. The Commission may on its own initiative or at the request of the Hold

Separate Monitor issue such additional orders or directions as may be 

necessary or appropriate to assure compliance with the requirements of this 

Hold Separate Order. 

IV.

IT IS FURTHER ORDERED that:

A. Respondents shall cooperate with, and take no action to interfere with or 

impede the ability of: (i) the Hold Separate Monitor, (ii) any Hold Separate 

Business Employee, or (iii) any Support Services Employee, to perform his 

or her duties and responsibilities consistent with the terms of this Hold 

Separate Order and the Decision and Order.

B. Respondents shall continue to provide, or offer to provide, Support Services 

and Required Inputs to the Hold Separate Business as were being provided to 

the Hold Separate Business by Respondents as of the Date of the Merger 

Agreement;

1. For Support Services and Required Inputs that Respondents provided 

to the Hold Separate Business as of the Date of the Merger 

Agreement, Respondents may charge no more than the same price, if 

any, charged by Respondents for such Support Services and Required 

Inputs as of the Date of the Merger Agreement;

2. For any other Support Services and Required Inputs that Respondents 

may provide to the Hold Separate Business, Respondents may charge 

no more than Respondents’ Direct Cost for the same or similar 

Support Services or Required Inputs; and

3. Notwithstanding the above, the Hold Separate Business shall have, in 

consultation with the Hold Separate Monitor, the ability to acquire 

Support Services or Required Inputs from Persons other than 

Respondents.

4. Notwithstanding the above, Respondents’ obligation to provide 

Support Services to the Hold Separate Business shall not include the 

provision of legal services in Germany to the extent that the provision 

of such services is not permitted by law.
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C. Respondents shall not permit:

1. Any of its employees, officers, agents, or directors, other than (i) any 

Hold Separate Employees, and (ii) any Support Services Employees, 

to be involved in the operations of the Hold Separate Business, except 

to the extent otherwise provided in this Hold Separate Order.

2. Any Hold Separate Employee to be involved, in any way, in the operations 

of Respondents’ businesses other than the Hold Separate Business.

D. Respondents shall provide the Hold Separate Business with sufficient 

financial and other resources as may be required to fulfill Respondents’ 

obligations and responsibilities under the Orders, and as may reasonably be 

requested by the Hold Separate Monitor, to:

1. Operate the Hold Separate Business as it was operated as of the 

Date of the Merger Agreement (including efforts to generate new 

business) consistent with the practices of the Hold Separate 

Business in place prior to the Date of the Merger Agreement;

2. Perform all maintenance to, and replacements or remodeling of, the 

assets of the Hold Separate Business in the ordinary course of

business and in accordance with past practice and with current

plans;

3. Carry on such capital projects, physical plant improvements, and 

business plans (including, but not limited to, the Tillsonburg 

Production Lines as set forth in Confidential Appendix A to this 

Hold Separate Order) as are already under way or planned for 

which all necessary regulatory and legal approvals have been 

obtained, including, but not limited to, existing or planned

renovation, remodeling, and expansion projects; and

4. Maintain the viability, competitiveness, and marketability of the 

Hold Separate Business.

Such financial resources to be provided to the Hold Separate Business shall 

include, but shall not be limited to, (i) general funds, (ii) capital, (iii) working 

capital, and (iv) reimbursement for any operating losses, capital losses, or 

other losses; provided, however, that, consistent with the purposes of the 

Decision and Order, the Hold Separate Monitor may, in consultation with 

Commission staff, direct the Hold Separate Business Employees to reduce in 

scale or pace any capital or research and development project of the Hold 

Separate Business, or substitute any capital or research and development 

project of the Hold Separate Business for another of the same cost.
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E. Respondents shall provide each Hold Separate Business Employee with 

reasonable financial incentives to continue in his or her position consistent 

with past practices and/or as may be necessary to preserve the 

marketability, viability, and competitiveness of the Divestiture Assets 

pending divestiture. Such incentives shall include a continuation of all 

employee benefits (or employee benefits of substantially equivalent value), 

including funding of regularly scheduled raises and bonuses, vesting of

pension benefits (as permitted by law), and additional incentives as may be

necessary to assure the continuation, and prevent any diminution, of the 

viability, marketability, and competitiveness of the Hold Separate Business 

until the Closing Date, and as may otherwise be necessary to achieve the 

purposes of this Hold Separate Order.

F. No later than ten (10) days after the date the Acquisition is completed, 

Respondents shall establish and implement procedures, subject to the 

approval of the Hold Separate Monitor, covering the management,

maintenance, and independence of the Hold Separate Business consistent

with the provisions of this Hold Separate Order.

G. No later than ten (10) days after the date the Acquisition is completed, 

Respondents shall circulate to Hold Separate Business Employees, Support 

Services Employees, and to persons who are employed in Respondents’ 

businesses that compete with the Hold Separate Business, a notice of the 

requirements of this Hold Separate Order, the Decision and Order, and the 

Consent Agreement, in a form approved by the Hold Separate Monitor in 

consultation with Commission staff, including copies of the Hold Separate 

Order and the Decision and Order.

V.

IT IS FURTHER ORDERED that:

A. After the date the Acquisition is completed, Respondents’ employees, other 

than employees of the Hold Separate Business and Support Services 

Employees, shall not receive, or have access to, or use or continue to use any 

Material Confidential Information of the Hold Separate Business except in 

the course of:

1. Performing their obligations or as permitted under this Hold Separate

Order or the Decision and Order;

2. Performing their obligations under the Divestiture Agreements;

3. Negotiating agreements to divest assets pursuant to the Decision and

Order and engaging in related due diligence; and
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4. Complying with financial reporting requirements, obtaining legal 

advice, defending legal claims, conducting investigations, or

enforcing actions threatened or brought against the Hold Separate 

Business, or as required by law. Notwithstanding the above, 

Respondents may receive aggregate financial and operational 

information relating to the Hold Separate Business only to the extent 

necessary to allow Respondents to comply with the requirements and 

obligations of the laws and regulations of the United States and other 

countries, to prepare consolidated financial reports, tax returns, 

reports required by securities laws, and personnel reports, and to 

comply with this Hold Separate Order or in complying with or as 

permitted by the Decision and Order. Any such information that is 

obtained pursuant to this subparagraph shall be used only for the 

purposes set forth in this Hold Separate Order.

For purposes of this Paragraph V.A., Respondents’ employees that 

provide Support Services or that staff the Hold Separate Business shall be 

deemed to be performing obligations under this Hold Separate Order.

B. If access to or disclosure of Material Confidential Information of the Hold 

Separate Business to Respondents’ employees is necessary and permitted 

under Paragraph V.A. of this Hold Separate Order, Respondents shall:

1. Implement and maintain a process and procedures, as approved by the 

Hold Separate Monitor, such approval not to be unreasonably 

withheld, pursuant to which Material Confidential Information of the 

Hold Separate Business may be disclosed or used only:

a. to or by those employees who require such information;

b. to the extent such Material Confidential Information is required; and

c. after such employees have signed an appropriate agreement in writing 

to maintain the confidentiality of such information.

2. Enforce the terms of this Paragraph V. as to any of Respondents’ 

employees and take such action as is necessary to cause each such 

employee to comply with the terms of this Paragraph V, including 

training Respondents’ employees and taking all other actions that 

Respondents would take to protect their own trade secrets and 

proprietary information.

C. Respondents shall implement, and maintain in operation, a system, as 

approved by the Hold Separate Monitor, of access and data controls to prevent 

unauthorized access to or dissemination of Material Confidential Information 

of the Hold Separate Business, including, but not limited to, the opportunity 

by the Hold Separate Monitor, on terms and conditions agreed to with
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Respondents, to audit Respondents’ networks and systems to verify 

compliance with this Hold Separate Order.

D. No Hold Separate Business Employee shall receive or have access to, or use 

or continue to use, any non-public, confidential information relating to 

Respondents’ businesses (not subject to the Hold Separate Order), except such 

information as is necessary to maintain and operate the Hold Separate 

Business.

VI.

IT IS FURTHER ORDERED that, within thirty (30) days after this Hold 

Separate Order becomes final, and every thirty (30) days thereafter until this Hold 

Separate Order terminates, Respondents shall submit to the Commission a verified 

written report setting forth in detail the manner and form in which they intend to 

comply, are complying, and have complied with all provisions of this Hold 

Separate Order. Respondents shall include in their reports, among other things that 

are required from time to time, a full description of the efforts being made to 

comply with this Hold Separate Order.

VII.

IT IS FURTHER ORDERED each Respondent shall notify the 

Commission at least thirty (30) days prior to:

A. Any proposed dissolution of such Respondent;

B. Any proposed acquisition, merger, or consolidation of such Respondent; and

C. Any other change in such Respondent including, but not limited to, assignment

and the creation or dissolution of subsidiaries, if such change may affect 

compliance obligations arising out of this Hold Separate Order.

VIII.

IT IS FURTHER ORDERED that, for purposes of determining or securing 

compliance with this Hold Separate Order, and subject to any legally recognized 

privilege, and upon written request and upon five (5) days notice to the applicable 

Respondent made to its principal United States offices, registered office of its United 

States subsidiary, or headquarters address, such Respondent shall, without restraint 

or interference, permit any duly authorized representative of the Commission:
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A. Access, during business office hours of such Respondent and in the presence 

of counsel, to all facilities and access to inspect and copy all books, ledgers, 

accounts, correspondence, memoranda and all other records and documents 

in the possession or under the control of such Respondent related to 

compliance with this Hold Separate Order, which copying services shall be 

provided by such Respondent at the request of the authorized 

representative(s) of the Commission and at the expense of such Respondent; 

and

B. The opportunity to interview officers, directors, or employees of such 

Respondent, who may have counsel present, related to compliance with this 

Hold Separate Order.

IX.

IT IS FURTHER ORDERED that this Hold Separate Order shall 

terminate at the earlier of:

A. Three (3) business days after the Commission withdraws its acceptance of the

Consent Agreement pursuant to the provisions of Commission Rule 2.34, 16

C.F.R. § 2.34; or

B. The day after divestiture required by the Decision and Order is completed.

By the Commission, Commissioner Wright dissenting.

Donald S. Clark

Secretary

SEAL: 

ISSUED: May 5, 2015
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CONFIDENTIAL APPENDICES A-B

[Redacted From the Public Version, But Incorporated By Reference]