II 

108TH CONGRESS 

1ST SESSION S. 1799

To encourage the development and promulgation of voluntary consensus 

standards by providing relief under the antitrust laws to standards development organizations with respect to conduct engaged in for the purpose 

of developing voluntary consensus standards, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

OCTOBER 30, 2003

Mr. LEAHY (for himself and Mr. HATCH) introduced the following bill; which 

was read twice and referred to the Committee on the Judiciary 

A BILL

To encourage the development and promulgation of voluntary 

consensus standards by providing relief under the antitrust laws to standards development organizations with 

respect to conduct engaged in for the purpose of developing voluntary consensus standards, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Standards Develop5 ment Organization Advancement Act of 2003’’. 
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1 SEC. 2. FINDINGS. 

2 The Congress finds the following: 

3 (1) In 1993, the Congress amended and re4 named the National Cooperative Research Act of 

5 1984 (now known as the National Cooperative Re6 search and Production Act of 1993 (15 U.S.C. 4301 

7 et seq.)) by enacting the National Cooperative Pro8 duction Amendments of 1993 (Public Law 103–42) 

9 to encourage the use of collaborative, procompetitive 

10 activity in the form of research and production joint 

11 ventures that provide adequate disclosure to the 

12 antitrust enforcement agencies about the nature and 

13 scope of the activity involved. 

14 (2) Subsequently, in 1995, the Congress in en15 acting the National Technology Transfer and Ad16 vancement Act of 1995 (15 U.S.C. 272 note) recog17 nized the importance of technical standards devel18 oped by voluntary consensus standards bodies to our 

19 national economy by requiring the use of such stand20 ards to the extent practicable by Federal agencies 

21 and by encouraging Federal agency representatives 

22 to participate in ongoing standards development ac23 tivities. The Office of Management and Budget on 

24 February 18, 1998, revised Circular A–119 to re25 flect these changes made in law. 
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1 (3) Following enactment of the National Tech2 nology Transfer and Advancement Act of 1995, 

3 technical standards developed or adopted by vol4 untary consensus standards bodies have replaced 

5 thousands of unique Government standards and 

6 specifications allowing the national economy to oper7 ate in a more unified fashion. 

8 (4) Having the same technical standards used 

9 by Federal agencies and by the private sector per10 mits the Government to avoid the cost of developing 

11 duplicative Government standards and to more read12 ily use products and components designed for the 

13 commercial marketplace, thereby enhancing quality 

14 and safety and reducing costs. 

15 (5) Technical standards are written by hun16 dreds of nonprofit voluntary consensus standards 

17 bodies in a nonexclusionary fashion, using thousands 

18 of volunteers from the private and public sectors, 

19 and are developed under the standards development 

20 principles set out in Circular Number A–119, as re21 vised February 18, 1998, of the Office of Manage22 ment and Budget, including principles that require 

23 openness, balance, transparency, consensus, and due 

24 process. Such principles provide for—
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1 (A) notice to all parties known to be af2 fected by the particular standards development 

3 activity, 

4 (B) the opportunity to participate in 

5 standards development or modification, 

6 (C) balancing interests so that standards 

7 development activities are not dominated by any 

8 single group of interested persons, 

9 (D) readily available access to essential in10 formation regarding proposed and final stand11 ards, 

12 (E) the requirement that substantial 

13 agreement be reached on all material points 

14 after the consideration of all views and objec15 tions, and 

16 (F) the right to express a position, to have 

17 it considered, and to appeal an adverse decision. 

18 (6) There are tens of thousands of voluntary 

19 consensus standards available for government use. 

20 Most of these standards are kept current through in21 terim amendments and interpretations, issuance of 

22 addenda, and periodic reaffirmation, revision, or 

23 reissuance every 3 to 5 years.
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1 (7) Standards developed by government entities 

2 generally are not subject to challenge under the anti3 trust laws. 

4 (8) Private developers of the technical stand5 ards that are used as Government standards are

6 often not similarly protected, leaving such developers 

7 vulnerable to being named as codefendants in law8 suits even though the likelihood of their being held 

9 liable is remote in most cases, and they generally 

10 have limited resources to defend themselves in such 

11 lawsuits. 

12 (9) Standards development organizations do not 

13 stand to benefit from any antitrust violations that 

14 might occur in the voluntary consensus standards 

15 development process. 

16 (10) As was the case with respect to research 

17 and production joint ventures before the passage of 

18 the National Cooperative Research and Production 

19 Act of 1993, if relief from the threat of liability 

20 under the antitrust laws is not granted to voluntary 

21 consensus standards bodies, both regarding the de22 velopment of new standards and efforts to keep ex23 isting standards current, such bodies could be forced 

24 to cut back on standards development activities at 
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1 great financial cost both to the Government and to 

2 the national economy. 

3 SEC. 3. DEFINITIONS. 

4 Section 2 of the National Cooperative Research and 

5 Production Act of 1993 (15 U.S.C. 4301) is amended—

6 (1) in subsection (a) by adding at the end the 

7 following: 

8 ‘‘(7) The term ‘standards development activity’ 

9 means any action taken by a standards development 

10 organization for the purpose of developing, promul11 gating, revising, amending, reissuing, interpreting, 

12 or otherwise maintaining a voluntary consensus 

13 standard, or using such standard in conformity as14 sessment activities, including actions relating to the 

15 intellectual property policies of the standards devel16 opment organization. 

17 ‘‘(8) The term ‘standards development organi18 zation’ means a domestic or international organiza19 tion that plans, develops, establishes, or coordinates 

20 voluntary consensus standards using procedures that 

21 incorporate the attributes of openness, balance of in22 terests, due process, an appeals process, and con23 sensus in a manner consistent with the Office of 

24 Management and Budget Circular Number A–119, 

25 as revised February 10, 1998. 
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1 ‘‘(9) The term ‘technical standard’ has the 

2 meaning given such term in section 12(d)(4) of the 

3 National Technology Transfer and Advancement Act 

4 of 1995. 

5 ‘‘(10) The term ‘voluntary consensus standard’ 

6 has the meaning given such term in Office of Man7 agement and Budget Circular Number A–119, as re8 vised February 10, 1998.’’; and 

9 (2) by adding at the end the following: 

10 ‘‘(c) The term ‘standards development activity’ ex11 cludes the following activities: 

12 ‘‘(1) Exchanging information among competi13 tors relating to cost, sales, profitability, prices, mar14 keting, or distribution of any product, process, or 

15 service that is not reasonably required for the pur16 pose of developing or promulgating a voluntary con17 sensus standard, or using such standard in con18 formity assessment activities. 

19 ‘‘(2) Entering into any agreement or engaging 

20 in any other conduct that would allocate a market 

21 with a competitor. 

22 ‘‘(3) Entering into any agreement or conspiracy 

23 that would set or restrain prices of any good or serv24 ice.’’. 
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1 SEC. 4. RULE OF REASON STANDARD. 

2 Section 3 of the National Cooperative Research and 

3 Production Act of 1993 (15 U.S.C. 4302) is amended by 

4 striking ‘‘of any person in making or performing a con5 tract to carry out a joint venture shall’’ and inserting the 

6 following: ‘‘of—

7 ‘‘(1) any person in making or performing a con8 tract to carry out a joint venture, or 

9 ‘‘(2) a standards development organization 

10 while engaged in a standards development activity, 

11 shall’’. 

12 SEC. 5. LIMITATION ON RECOVERY. 

13 Section 4 of the National Cooperative Research and 

14 Production Act of 1993 (15 U.S.C. 4303) is amended—

15 (1) in subsections (a)(1), (b)(1), and (c)(1) by 

16 inserting ‘‘, for a standards development activity en17 gaged in by a standards development organization 

18 against which such claim is made’’ after ‘‘joint ven19 ture’’, and 

20 (2) in subsection (e)—

21 (A) by inserting ‘‘, or of a standards devel22 opment activity engaged in by a standards de23 velopment organization’’ before the period at 

24 the end, and 

25 (B) by redesignating such subsection as 

26 subsection (f), and 
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1 (3) by inserting after subsection (d) the fol2 lowing:

3 ‘‘(e) Subsections (a), (b), and (c) shall not be con4 strued to modify the liability under the antitrust laws of 

5 any person (other than a standards development organiza6 tion) who—

7 ‘‘(1) directly (or through an employee or agent) 

8 participates in a standards development activity with 

9 respect to which a violation of any of the antitrust 

10 laws is found, 

11 ‘‘(2) is not a fulltime employee of the standards 

12 development organization that engaged in such ac13 tivity, and 

14 ‘‘(3) is, or is an employee or agent of a person 

15 who is, engaged in a line of commerce that is likely 

16 to benefit directly from the operation of the stand17 ards development activity with respect to which such 

18 violation is found.’’. 

19 SEC. 6. ATTORNEY FEES. 

20 Section 5 of the National Cooperative Research and 

21 Production Act of 1993 (15 U.S.C. 4304) is amended—

22 (1) in subsection (a) by inserting ‘‘, or of a 

23 standards development activity engaged in by a 

24 standards development organization’’ after ‘‘joint 

25 venture’’, and 
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1 (2) by adding at the end the following: 

2 ‘‘(c) Subsections (a) and (b) shall not apply with re3 spect to any person who—

4 ‘‘(1) directly participates in a standards devel5 opment activity with respect to which a violation of 

6 any of the antitrust laws is found, 

7 ‘‘(2) is not a fulltime employee of a standards 

8 development organization that engaged in such ac9 tivity, and 

10 ‘‘(3) is, or is an employee or agent of a person 

11 who is, engaged in a line of commerce that is likely 

12 to benefit directly from the operation of the stand13 ards development activity with respect to which such 

14 violation is found.’’. 

15 SEC. 7. DISCLOSURE OF STANDARDS DEVELOPMENT AC16 TIVITY. 

17 Section 6 of the National Cooperative Research and 

18 Production Act of 1993 (15 U.S.C. 4305) is amended—

19 (1) in subsection (a)—

20 (A) by redesignating paragraphs (1), (2), 

21 and (3) as subparagraphs (A), (B), and (C), re22 spectively, 

23 (B) by inserting ‘‘(1)’’ after ‘‘(a)’’, and 

24 (C) by adding at the end the following: 
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1 ‘‘(2) A standards development organization may, not 

2 later than 90 days after commencing a standards develop3 ment activity engaged in for the purpose of developing or 

4 promulgating a voluntary consensus standards or not later 

5 than 90 days after the date of the enactment of the Stand6 ards Development Organization Advancement Act of 

7 2003, whichever is later, file simultaneously with the At8 torney General and the Commission, a written notification 

9 disclosing—

10 ‘‘(A) the name and principal place of business 

11 of the standards development organization, and 

12 ‘‘(B) documents showing the nature and scope 

13 of such activity. 

14 Any standards development organization may file addi15 tional disclosure notifications pursuant to this section as 

16 are appropriate to extend the protections of section 4 to 

17 standards development activities that are not covered by 

18 the initial filing or that have changed significantly since 

19 the initial filing.’’, 

20 (2) in subsection (b)—

21 (A) in the 1st sentence by inserting ‘‘, or 

22 a notice with respect to such standards develop23 ment activity that identifies the standards de24 velopment organization engaged in such activity 
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1 and that describes such activity in general 

2 terms’’ before the period at the end, and 

3 (B) in the last sentence by inserting ‘‘or 

4 available to such organization, as the case may 

5 be’’ before the period, 

6 (3) in subsection (d)(2) by inserting ‘‘, or the 

7 standards development activity,’’ after ‘‘venture’’, 

8 (4) in subsection (e)—

9 (A) by striking ‘‘person who’’ and inserting 

10 ‘‘person or standards development organization 

11 that’’, and 

12 (B) by inserting ‘‘or any standards devel13 opment organization’’ after ‘‘person’’ the last 

14 place it appears, and 

15 (5) in subsection (g)(1) by inserting ‘‘or stand16 ards development organization’’ after ‘‘person’’. 

17 SEC. 8. RULE OF CONSTRUCTION. 

18 Nothing in this Act shall be construed to alter or 

19 modify the antitrust treatment under existing law of—

20 (1) parties participating in standards develop21 ment activity of standards development organiza22 tions within the scope of this Act, or 
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1 (2) other organizations and parties engaged in 

2 standard-setting processes not within the scope of 

3 this amendment to the Act.

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