IIA
103D CONGRESS
1ST SESSION
H. R. 1313
IN THE SENATE OF THE UNITED STATES
MAY 19 (legislative day, APRIL 19), 1993
Received; read twice and referred to the Committee on the Judiciary
AN ACT
To amend the National Cooperative Research Act of 1984
with respect to joint ventures entered into for the pur-
pose of producing a product, process, or service.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘National Cooperative
Production Amendments of 1993’’.
SEC. 2. FINDINGS AND PURPOSE.
(a) FINDINGS.—The Congress finds that—
(1) technological innovation and its profitable
commercialization are critical components of the
ability of the United States to raise the living stand-
ards of Americans and to compete in world markets;
(2) 
cooperative 
arrangements 
among
nonaffiliated businesses in the private sector are
often essential for successful technological innova-
tion; and
(3) the antitrust laws may have been mistak-
enly perceived to inhibit procompetitive cooperative
innovation arrangements, and so clarification serves
a useful purpose in helping to promote such ar-
rangements.
(b) PURPOSE.—It is the purpose of this Act to pro-
mote innovation, facilitate trade, and strengthen the com-
petitiveness of the United States in world markets by
clarifying the applicability of the rule of reason standard
and establishing a procedure under which businesses may
notify the Department of Justice and Federal Trade Com-
mission of their cooperative ventures and thereby qualify
for a single-damages limitation on civil antitrust liability.
SEC. 3. AMENDMENTS.
(a) SHORT TITLE.—Section 1 of the National Coop-
erative Research Act of 1984 (15 U.S.C. 4301 note) is
amended by striking ‘‘National Cooperative Research Act
of 1984’’ and inserting ‘‘National Cooperative Research
and Production Act of 1993’’.
(b) DEFINITION.—Section 2(a)(6) of the National
Cooperative Research Act of 1984 (15 U.S.C. 4301(a)(6))
is amended—
(1) in the matter preceding subparagraph (A)
by striking ‘‘research and development’’;
(2) in subparagraph (D) by inserting ‘‘or pro-
duction’’ after ‘‘research’’;
(3) in subparagraph (E) by striking ‘‘and (D)’’
and inserting ‘‘(D), (E), and (F)’’;
(4) by redesignating subparagraphs (D) and
(E) as subparagraphs (F) and (G), respectively;
(5) by inserting after subparagraph (C) the
following:
‘‘(D) the production of a product, process,
or service,
‘‘(E) the testing in connection with the
production of a product, process, or service by
such venture,’’; and
(6) by striking ‘‘research’’ the last place it ap-
pears and inserting ‘‘such venture’’.
(c) EXCLUSIONS.—Section 2(b) of the National Co-
operative Research Act of 1984 (15 U.S.C. 4301(b)) is
amended—
(1) in the matter preceding paragraph (1) by
striking ‘‘research and development’’;
(2) in paragraph (1) by striking ‘‘that is not
reasonably required to conduct the research and de-
velopment that is’’ and inserting ‘‘if such informa-
tion is not reasonably required to carry out’’;
(3) by amending paragraph (2) to read as
follows:
‘‘(2) entering into any agreement or engaging
in any other conduct restricting, requiring, or other-
wise involving the marketing, distribution, or provi-
sion by any person who is a party to such venture
of any product, process, or service, other than—
‘‘(A) the distribution among the parties to
such venture, in accordance with such venture,
of a product, process, or service produced by
such venture,
‘‘(B) the marketing of proprietary informa-
tion, such as patents and trade secrets, devel-
oped through such venture formed under a
written agreement entered into before the date
of the enactment of the National Cooperative
Production Amendments of 1993, or
‘‘(C) the licensing, conveying, or transfer-
ring of intellectual property, such as patents
and trade secrets, developed through such ven-
ture formed under a written agreement entered
into on or after the date of the enactment of
the National Cooperative Production Amend-
ments of 1993,’’;
(4) in paragraph (3)—
(A) in subparagraph (A) by striking ‘‘or
developments not developed through’’ and in-
serting ‘‘, developments, products, processes, or
services not developed through, or produced
by,’’;
(B) in subparagraph (B) by striking ‘‘such
party’’ and inserting ‘‘any person who is a
party to such venture’’; and
(C) by striking the period at the end and
inserting a comma; and
(5) by adding at the end the following:
‘‘(4) entering into any agreement or engaging
in any other conduct allocating a market with a
competitor,
‘‘(5) exchanging information among competitors
relating to production (other than production by
such venture) of a product, process, or service if
such information is not reasonably required to carry
out the purpose of such venture,
‘‘(6) entering into any agreement or engaging
in any other conduct restricting, requiring, or other-
wise involving the production (other than the pro-
duction by such venture) of a product, process, or
service,
‘‘(7) using existing facilities for the production
of a product, process, or service by such venture un-
less such use involves the production of a new prod-
uct or technology, and
‘‘(8) except as provided in paragraphs (2), (3),
and (6), entering into any agreement or engaging in
any other conduct to restrict or require participation
by any person who is a party to such venture, in any
unilateral or joint activity that is not reasonably re-
quired to carry out the purpose of such venture.’’.
(d) RULE OF REASON STANDARD.—Section 3 of the
National Cooperative Research Act of 1984 (15 U.S.C.
4302) is amended—
(1) by striking ‘‘research and development’’ the
first place it appears;
(2) by striking ‘‘and development’’ the last
place it appears and inserting ‘‘, development, prod-
uct, process, and service’’; and
(3) by adding at the end the following:
‘‘For the purpose of determining a properly defined, rel-
evant market, worldwide capacity shall be considered to
the extent that it may be appropriate in the cir-
cumstances.’’.
(e) TECHNICAL AND CONFORMING AMENDMENTS.—
The National Cooperative Research Act of 1984 (15
U.S.C. 4301 et seq.) is amended—
(1) in section 4—
(A) in subsections (a)(1), (b)(1), (c)(1),
and (e) by striking ‘‘research and development’’
each place it appears;
(B) in subsections (a), (b), and (c) by in-
serting ‘‘of this section’’ after ‘‘subsection (d)’’
each place it appears; and
(C) in subsection (e) by striking ‘‘the effec-
tive date of this Act’’ and inserting ‘‘October
11, 1984,’’; and
(2) in section 5(a) in the matter preceding
paragraph (1) by striking ‘‘research and develop-
ment’’.
(f) DISCLOSURE.—Section 6 of the National Cooper-
ative Research Act of 1984 (15 U.S.C. 4305) is amend-
ed—
(1) in the heading by striking ‘‘RESEARCH AND
DEVELOPMENT’’;
(2) in subsection (a)—
(A) by striking ‘‘the date of the enactment
of this Act’’ and inserting ‘‘October 11, 1984’’;
(B) in paragraph (1) by striking ‘‘and’’ at
the end;
(C) in paragraph (2) by striking the period
at the end and inserting ‘‘, and’’; and
(D) by inserting the following after para-
graph (2):
‘‘(3) if a purpose of such venture is the produc-
tion of a product, process, or service, as referred to
in section 2(a)(6)(D), the identity and nationality of
any person who is a party to such venture, or who
controls any party to such venture whether sepa-
rately or with one or more other persons acting as
a group for the purpose of controlling such party.’’;
and
(3) in subsections (a), (d)(2), and (e) by strik-
ing ‘‘research and development’’ each place it ap-
pears.
(g) LIMITATION.—The National Cooperative Re-
search Act of 1984 (15 U.S.C. 4301 et seq.) is amended
by adding at the end the following:
‘‘APPLICATION OF SECTION 4 PROTECTIONS TO
PRODUCTION OF PRODUCTS, PROCESSES, AND SERVICES
‘‘SEC. 7. Notwithstanding sections 4 and 6, the pro-
tections of section 4 shall not apply with respect to a joint
venture’s production of a product, process, or service, as
referred to in section 2(a)(6)(D), unless—
‘‘(1) the principal facilities for such production
are located in the United States or its territories,
and
‘‘(2) each person who controls any party to
such venture (including such party itself) is a United
States person, or a foreign person from a country
whose law accords antitrust treatment no less favor-
able to United States persons than to such country’s
domestic persons with respect to participation in
joint ventures for production.’’.
SEC. 4. REPORTS ON JOINT VENTURES AND UNITED
STATES COMPETITIVENESS.
(a) PURPOSE.—The purpose of the reports required
by this section is to inform Congress and the American
people of the effect of the National Cooperative Research
and Production Act of 1993 on the competitiveness of the
United States in key technological areas of research, devel-
opment, and production.
(b) ANNUAL REPORT
BY
THE ATTORNEY GEN-
ERAL.—In the 30-day period beginning at each 1-year in-
terval in the 6-year period beginning on the date of the
enactment of this Act, the Attorney General shall submit
to the Committee on the Judiciary of the House of Rep-
resentatives and the Committee on the Judiciary of the
Senate—
(1) a list of joint ventures for which notice was
filed under section 6(a) of the National Cooperative
Research and Production Act of 1993 during the 12-
month period for which such report is made, includ-
ing—
(A) the purpose of each joint venture;
(B) the identity of each party described in
section 6(a)(1) of such Act; and
(C) the identity and nationality of each
person described in section 6(a)(3) of such Act;
and
(2) a list of cases and proceedings, if any,
brought during such period under the antitrust laws
by the Department of Justice, and by the Federal
Trade Commission, with respect to joint ventures for
which notice was filed under such section at any
time.
(c) TRIENNIAL REPORT BY THE ATTORNEY GEN-
ERAL.—In the 30-day period beginning at each 3-year in-
terval in the 6-year period beginning on the date of the
enactment of this Act, the Attorney General, after con-
sultation with such other agencies as the Attorney General
considers to be appropriate, shall submit to the Committee
on the Judiciary of the House of Representatives and the
Committee on the Judiciary of the Senate a description
of the technological areas most commonly pursued by joint
ventures for production for which notice was filed under
section 6(a) of the National Cooperative Research and
Production Act of 1993 during the 3-year period for which
such report is made, and an analysis of the trends in the
competitiveness of United States industry in such areas.
(d) REVIEW
OF ANTITRUST TREATMENT UNDER
FOREIGN LAWS.—In the three 30-day periods beginning
1 year, 3 years, and 6 years after the date of the enact-
ment of this Act, the Attorney General, after consultation
with such other agencies as the Attorney General consid-
ers to be appropriate, shall submit to the Committee on
the Judiciary of the House of Representatives and the
Committee on the Judiciary of the Senate a report on the
antitrust treatment of United States businesses with re-
spect to participation in joint ventures for production,
under the law of each foreign nation any of whose domes-
tic businesses disclosed its nationality under section
6(a)(3) of the National Cooperative Research and Produc-
tion Act of 1993 at any time.
Passed the House of Representatives May 18, 1993.
Attest:
DONNALD K. ANDERSON,
Clerk.