COMVIISSION OF THE EUROPEAN COMMUNITIES 
C0M(94) 430 final 
Brussels, 12.10.1994 
94/ 0236(CNS) 
Commission communication to the Council 
concerning cooperation with the United States of America regarding 
the application of their competition rules 
Proposal for a 
COUNCIL DECISION 
concluding the Agreement between the European Communities and 
the Government of the United States of America regarding the application 
of their competition laws 
(presented by the Commission) 
Commission communication to the Council 
concerning cooperation with the United States of America regarding 
the application of their competition rules 
Introduction 
The increasing internationalization of the economy, reflected in the steadily growing 
volume of trade in goods and services, has implications for competition policy. More 
and more often, practices in other countries can have repercussions within the 
Community, and it may be difficult to deal with them on the basis of Community 
rules. For instance, in Community law, one of the criteria governing the application 
of Articles 85 and 86 of the EC Treaty is that the anti-competitive conduct in question 
should "affect trade between Member States". In its Wood pulp decision, the Court 
of Justice accepted that the Community competition rules could apply to undertakings 
based outside the Community where the conduct in question took place within the 
Community. However, this approach does not allow effective action and sanctions to 
be taken against all restrictive conduct originating abroad. 
Furthermore, the problems encountered by firms operating at international level 
(multinationals) often have a global dimension, and the agreements which they 
conclude may be examined by different competition authorities. 
So as to deal with such increasingly international situations, cooperation arrangements 
must be established between competition authorities that will permit improved 
coordination where the same cases are handled by a number of authorities and will 
allow action to be taken against conduct originating in one country and having 
repercussions in another 
This approach allows an effective solution to be found to the problems encountered, 
while at the same time avoiding the conflicts that may arise from a unilateral reaction 
based on extraterritoriality. It is for this reason that the Commission considers that 
cooperation agreements must be concluded between competition authorities. 
II. The Agreement between the European Communities and the Government of the United 
States of America on the application of their competition rules 
1. In 1991 the Commission negotiated and signed a cooperation agreement with the US 
anti-trust authorities (the US Department of Justice and the US Federal Trade 
Commission) The aim of the agreement is to promote cooperation between 
competition authorities by encouraging the exchange of information, and to promote 
dialogue between authorities in accordance with a 1986 OECD recommendation on 
cooperation in competition matters. 
However, the Agreement goes further than the OECD recommendation, for example 
by incorporating a number of principles established by US case-law in order to restrict 
excesses in the extraterritorial application of US competition rules (negative comity) 
and by developing for the first time the concept of positive comity. 
Nevertheless, the Agreement is of mainly symbolic value. Although it was signed by 
the Commission, the latter was bound by the obligations laid down in the Treaty and 
in the regulations adopted by the Council. This constraint is of particular importance 
here because of the confidentiality requirement imposed on the Commission under 
Regulation No 17 (First Regulation implementing Articles 85 and 86 of the 
EC Treaty), a requirement from which it could not derogate. 
2. The conclusion of the Agreement was recently overturned by the Court of Justice, 
which took the view that it was for the Council to conclude such an act, with the 
exception of the elements relating to the ECSC Treaty, for which the Commission is 
competent. The Court did not annul the Agreement itself, and it remains valid in 
international law. In fact, under the Vienna Convention on the law of Treaties 
(Article 46), an international agreement concluded by an authority which is not 
"manifestly incompetent" binds the State concerned. In this case, the Commission was 
not manifestly incompetent as it required a reference to the Court of Justice and nearly 
three years of procedure for the Court to find finally that the Council was the 
competent institution. It can therefore be confirmed that under international law the 
European Communities are bound as regards the United States. 
Under Community law, however, the agreement has not been concluded by the 
competent institution. Measures must therefore be taken rapidly to remedy this 
shortcoming in Community law. There are two possible solutions: either terminate 
the Agreement, or ask the Council to conclude it. The Commission must also sign it 
for the ECSC aspects. Because of the advantages described above which accrue from 
international cooperation in competition matters, the Commission proposes that the 
Council choose the second option. For this purpose, a proposal for a Council Decision 
concluding the Agreement entered into between the European Communities and the 
Government of the United States of America regarding the application of their 
competition laws is set out in Annex 1 to this communication. 
3. The Commission considers that for the Council to sign the Agreement would in no 
way alter the scope of the commitments previously entered into. Although the 
Council may, by concluding an international agreement, derogate explicitly or 
implicitly from the regulations it has adopted, the Commission believes it is not 
appropriate to do so at this stage by amending the text of the Agreement. 
Furthermore, Article XI contains a provision allowing the agreement to be reviewed. 
The Commission considers that this provision could be invoked in future to allow the 
Community to conclude a more ambitious agreement (which could, for example, 
provide in certain circumstances for the exchange of confidential information) in the 
light of experience with the current Agreement. The US Congress will probably soon 
adopt legislation allowing agreements to be concluded between competition authorities 
that provide for the exchange of confidential information. 
Annex I 
Explanatory memorandum 
A. Introduction . • 
1. On 23 September 1991 the Commission negotiated and signed an agreement with the 
Government of the United States of America regarding the application of EC and US 
competition laws ("the Agreement"). In a judgment delivered on 9 August 1994, the 
Court of Justice ruled that the power to conclude such an agreement belonged not to 
the Commission, but to the Council. However, the Court of Justice did not annul the 
Agreement, which remains valid in international law. In fact, under the Vienna 
Convention on the law of Treaties (Article 46), an international agreement concluded 
by an authority which is not "manifestly incompetent" binds the State concerned. In 
this case, the Commission was not manifestly incompetent as it required a reference 
to the Court of Justice and nearly three years of procedure for the Court to find finally 
that the Council was the competent institution. It can therefore be confirmed that 
under international law the European Communities are bound as regards the United 
States. 
Under Community law, however, the agreement has not been concluded by the 
competent institution. To remedy this situation, steps must be taken to correct the 
deficiency in the procedure under which the Agreement was concluded. There are two 
possible solutions: either to terminate the Agreement using the procedure provided for 
in Article XI(2), or to have it approved by the authority that is competent in 
Community law. Because of the advantages accruing from effective cooperation 
between competition authorities, it is the second solution which it is proposed the 
Council adopt. It should be noted that the area covered by the Agreement also 
includes the competition rules set out in the ECSC Treaty. In as much as the 
*> 
Commission is comptent to conclude international agreements in this area, the 
Agreement must be concluded jointly by the Council and the Commission. 
2. Community competition policy applies to restrictions of competition affecting trade 
between Member States and not to those affecting markets in third countries. The 
gradual lowering and, in some cases, removal of tariff and non-tariff barriers to trade 
since the 1960s, together with other liberalization measures such as those concerning 
capital movements, have led to an enormous expansion in international trade. This 
has important consequences for the application of the competition rules: increasingly, 
non-Community firms are acting in an anti-competitive manner within the common 
market. Generally speaking, anti-competitive practices within the Community are 
often linked to similar practices on other markets, while anti-competitive practices on 
other markets produce effects within the common market. Similarly, as far as 
structural changes are concerned, a merger that exceeds the thresholds laid down in 
the Merger Control Regulation often has effects outside the common market. 
Conflicts between the activities of the various competition authorities are therefore 
highly probable, and it is useful to have a minimum level of communication between 
authorities in the application of their rules. 
B. Description of the Agreement 
1. The main objective of the Agreement is not to create a framework within which any 
conflicts arising between the Commission of the European Communities, on the one 
hand, and the US Department of Justice and Federal Trade Commission, on the other, 
may be resolved. The objective is instead to prevent such conflicts from arising by 
establishing a system of cooperation between the relevant authorities. 
2. Article I of the Agreement gives a definition of its scope. As far as the Community 
is concerned, it covers Articles 85, 86, 89 and 90 of the EC Treaty, Regulation (EEC) 
No 4064/89 on the control of concentrations between undertakings, Articles 65 and 
6 
66 of the ECSC Treaty and the implementing regulations adopted on the basis of those 
provisions. 
As far as the United States is concerned, the Agreement covers the Sherman Act, the 
Clayton Act, the Wilson Tariff Act and part of the Federal Trade Commission Act 
(Article 1.2ii). 
In so far as the scope of these various rules is not the same on both sides of the 
Atlantic, there is not necessarily a perfect balance in the information to be exchanged: 
thus, Articles 85 and 86 of the EC Treaty cover sectors that do not fall within the 
scope of the above-mentioned US acts; on the other hand. Regulation (EEC) 
No 4064/89 covers only large-scale mergers (i.e. those meeting the threshold criteria 
specified in the Regulation). This leads to a commensurate reduction in the volume 
of information which the Commission is liable to supply to the US authorities.1 
The overall balance of the agreement is satisfactory, particularly given the inclusion 
of Article 11(5) (see below). 
3. Article II provides that the other competition authority is to be notified if any of its 
"important interests" are affected. The Agreement describes some situations in which 
this test is satisfied. It also defines the point at which notification is required. Thé 
general approach here is that notification is to take place at a stage in the proceedings 
early enough to allow account still to be taken of the other party's opinion. 
Paragraph 5 of this Article merits some clarification. It requires notification 
whenever a competition authority participates in a regulatory or judicial proceeding. 
It was inserted at the Commission's request in order to rectify the above imbalance, 
which derives from the wide-ranging scope of Articles 85 and 86 of the EC Treaty. 
Articles 85 and 86 apply to all sectors of the economy, whereas in the United States 
i Most of the information exchanged since the entry into force of the Agreement has 
in fact related to mergers (see point C). 
^ 
different sectors are supervised by separate regulatory bodies. But the Department 
of Justice and the Federal Trade Commission may take part in proceedings before 
such bodies and, if they do, they will have to notify the Commission accordingly 
provided that the other conditions laid down in that paragraph are met. The same 
applies where the Department of Justice or the Federal Trade Commission takes part 
in judicial proceedings, a possibility not open to the Commission before the national 
courts. 
Article 11(6) is to be read in conjunction with Articles VIII and IX, which will be 
discussed below. 
4. Article III is general in scope and provides for the exchange of information and 
bilateral meetings between the competition authorities in cases other than those 
specified in Article II. This provision is also subject to Articles VIII and IX. 
5. Article IV is more innovative. The parties agree here not only to assist one another 
whenever their laws, their important interests and the available resources allow, but 
also - in some cases - where they both have an interest in pursuing enforcement 
activities with regard to related situations. This clause deals more specifically than 
the rest of the Agreement with the case already referred to in which anti-competitive 
conduct on the market of one party may be associated with identical conduct on the 
market of the other. In such circumstances, the competition authorities of the two 
parties can profitably coordinate their activities and provide each other with assistance, 
always to the extent compatible with their respective laws and important interests and 
provided their resources so permit. 
Such coordination may take place even in cases where one party takes the initiative 
of applying its rules while the other abstains from applying its own rules, and it may 
also involve sharing the work of enforcement between the parties in accordance with 
their capabilities. As Article IX of the Agreement recalls, this possibility is subject 
to compliance with the parties' own laws. The Merger Control Regulation, for 
example, lays down strict obligations which will prevent these forms of coordination 
S 
in the examination of a merger. A further limitation is imposed by the rules on 
confidentiality. 
The Agreement is the first of its kind to consolidate the rules on comity in a legal 
instrument. Article VI provides as follows: "Within the framework of its own laws 
and to the extent compatible with its important interests, each Party will seek, at all 
stages in its enforcement activities, to take into account the important interests of the 
other Party." This means that party A may refrain from exercising its powers, or may 
exercise them only in part, provided that it has discretion in the matter and within the 
limits imposed by its own law. This is to be done in cases where, by exercising its 
powers, party A would damage party B's interests to a greater extent than it would 
damage its own interests by taking no action. 
The converse may also arise, where a party would be entitled to act but prefers not 
to and its failure to enforce the rules runs counter to an important interest of the other 
party. This situation is dealt with in Article V. Known as the "positive comity" 
clause, it allows a party whose interests are adversely affected by activities within the 
other party's jurisdiction to bring the matter to the other party's attention. That party 
might have been unaware of the problem or might not have considered it a priority. 
Once it is aware of the situation and of the fact that it affects the important interests 
of the other party, the party notified may, at its own discretion and having due regard 
to this problem, undertake enforcement of the rules. 
The concept "important interests" is defined in Article VI. It must be understood in 
terms of the purpose of the Agreement, which is the establishment of effective 
cooperation in the competition sphere. The interests referred to must therefore be 
important by reference to that objective. However, point 3(e) also mentions the 
possibility of conflict with the other party's "articulated economic policies". This is 
intended to ensure that enforcement of the competition rules, whether territorial or 
extraterritorial, does not run counter to a clearly stated objective of the other party. 
1 
7. Article VII, which establishes consultation machinery, calls for little, if any 
clarification. 
8. Article VIII is a fundamental provision which underlies the whole of the Agreement. 
It states that information can be exchanged under the Agreement only where this does 
not infringe the rules of confidentiality of either party. 
On the Community side, the essential rules here are Article 20 of Regulation No 17 
and the corresponding provisions in the other regulations applying the competition 
rules, where it is stipulated that information which the Commission acquires in the 
exercise of its powers under the Regulation is to be confidential. In practice, this 
means that the Commission may not pass on to the US competition authorities 
information which is freely supplied by firms when they notify agreements or is 
obtained by the Commission through inquiries or requests for information. 
But the Agreement is not thereby rendered devoid of substance. The Commission 
frequently comes into possession of information which has not been acquired on the 
basis of Regulation No 17, and it may be that such information can usefully be 
exchanged with the US competition authorities. For example, the fact that an inquiry 
involving certain undertakings is in progress is not information which the Commission 
has acquired using its powers of investigation and is not therefore subject to the 
obligation in Article 20. Paragraph 2 of the Article VIII should be interpreted in this 
light: it requires both parties to maintain the confidentiality of information provided 
to them under the Agreement. 
Article IX confirms the general principle that the Agreement does not derogate from 
the existing rules. It was included because the Agreement was originally signed by 
the Commission, which, unlike the Council, is not empowered to derogate from the 
existing regulations. 
9. Lastly, Article XI(3) provides that the Agreement can be reviewed within 24 months 
of its entry into force. This provision has not yet been applied because of the legal 
A* 
challenge brought before the Court of Justice. However, the Commission does intend 
to invoke it in future in order to refine the Agreement on the basis of the experience 
acquired: problems arising in the competition sphere increasingly have an international 
dimension, and cooperation between competition authorities needs to be intensified in 
order to deal with them effectively. 
C. Practice 
1. The practice which has developed since the Agreement was concluded can be 
summarized as follows (23 September 1991 to 9 August 1994). 
The Commission has sent 61 notifications to the US authorities. Of these, 
45 concerned mergers and 16 other matters. In compliance with the 
Commission's obligation of confidentiality, notifications have been made in a 
standardized form, giving the names of the undertakings concerned, the reason 
why proceedings have been initiated and the stage reached in the proceedings. 
The Commission has received 112 notifications from the US authorities, 
comprising 77 merger cases and 35 other cases. 
2. So far no channels have been established for keeping the Member States informed. 
In the new context, the Commission proposes to set up the following machinery: 
the Member State or Member States whose important interests were found to 
be affected by reference to the criteria laid down in Article II of the 
Agreement would be informed of notifications sent to, or received from, the 
US authorities; 
information on the working of the Agreement would be provided twice a year 
to a committee of government competition specialists; the meetings would 
follow bilateral meetings with the US competition authorities. These principles 
are set out in a Commission statement attached to this proposal. 
/^ 
D. Legal basis 
In so far as this Agreement relates to the competition rules of the EC Treaty, the legal 
basis is Article 87 read in conjunction with Article 228(3), first indent, of the EC 
Treaty. In fact, the objective of the Agreement is to ensure that Article 85 and 86 of 
the EC Treaty are observed, which is one of the objectives set out in Article 87(2) of 
the EC Treaty. This legal basis involves a consultation of the European Parliament. 
For the aspects covered by the ECSC Treaty, the Commission is competent to ensure 
the application of the competition rules, including external aspects, as a consequence 
of the AETR jurisprudence. 
Conclusion 
The Commission accordingly proposes that the Council jointly with the Commission 
conclude the Agreement between the European Communities and the Government of 
the United States of America regarding the application of their competition laws. 
/fl 
PROPOSAL FOR A COUNCIL DECISION 
concluding the Agreement between the European Communities and 
the Government of the United States of America regarding the application 
of their competition laws 
THE COUNCIL OF THE EUROPEAN UNION, 
THE COMMISSION OF THE EUROPEAN COMMUNITIES, 
Having regard to the Treaty establishing the European Coal and Steel Community, in 
particular Articles 65 and 66, 
Having regard to the Treaty establishing the European Community, and in particular Article 
87 read in conjunction with Article 228(3), first indent, 
Having regard to the proposal from the Commission, 
Having regard to the opinion of the European Parliament, 
Whereas, given the increasingly pronounced international dimension of competition problems, 
international cooperation in this field should be strengthened; 
Whereas, to this end, the Commission has negotiated an Agreement with the Government of 
the United States of America on the application of the competition rules of the European 
Communities and of the United States of America; 
A'S 
Whereas, the Agreement negotiated by the Commission and the Government of the United 
States of America regarding cooperation on competition law should be approved, 
HAS DECIDED AS FOLLOWS: 
ARTICLE 1 
The Agreement between and the European Communities and the Government of the United 
States of America regarding the application of their competition laws is hereby approved on 
behalf of the European Coal and Steel Community and the European Community. 
The text of the Agreement is attached to this Decision. 
ARTICLE 2 
The President of the Council will lodge the notification provided for in Article XI of the 
Agreement on behalf of the European Community. The President of the Commission will 
lodge the said notification on behalf of the European Coal and Steel Community. 
Done at Brussels, 
For the Council For the Commission 
The President The President 
11 
/}U 
Statement by the Commission 
In order to provide the Member States with sufficient information on the content of the 
information exchanged under the Agreement between the European Communities and the 
Government of the United States of America and the Commission of the European 
Communities regarding the application of their competition rules, the Commission will notify 
the Member State or Member States whose interests are affected by information sent to, or 
received from, the US competition authorities. For the purposes of this statement, any 
Member State in which one of the parties (or one of the companies controlling one of these 
parties) to a practice that is the subject of a notification has its headquarters will be regarded 
as having such an interest. 
In addition, at meetings of government conupetition specialists to be held twice a year, the 
Commission will notify all the Member States of the information exchanged under the 
Agreement. This meeting will take place after the bilateral meetings with the US competition 
authorities provided for by the Agreement. 
12 
•1A 
AGREEMENT 
BETWEEN 
THE EUROPEAN COMMUNITIES AND THE GOVERNMENT OF THE UNITED 
STATES OF AMERICA REGARDING THE APPLICATION OF THEIR COMPETITION 
LAWS 
The European Coal and Steel Community, and the European Community on the one hand, 
( hereinafter "the European Communities ") 
and 
The Government of the United States of America, on the other hand, 
Recognizing that the world's economies are becoming increasingly interrelated, and in 
particular that this is true of the economies of the European Communities and the United 
States of America; 
Noting that the European Communities and the Government of the United States of America 
share the view that the sound and effective enforcement of competition law is a matter of 
importance to the efficient operation of their respective markets and to trade between them; 
Noting that the sound and effective enforcement of the Parties' competition laws would be 
enhanced by cooperation and, in appropriate cases, coordination between them in the 
application of those laws; 
Noting further that from time to time differences may arise between the Parties concerning 
the application of their competition laws to conduct or transactions that implicate significant 
interests of both Parties; 
Having regard to the Recommendation of the Council of the Organization for Economic 
Cooperation and Development Concerning Cooperation Between Member Countries on 
Restrictive Business Practices Affecting International Trade, adopted on June 5, 1986; 
and 
Having regard to the Declaration on US-EC Relations adopted on November 23, 1990; 
Have agreed as follows: 
Article I 
PURPOSE AND DEFINITIONS 
1. The purpose of this Agreement is to promote cooperation and coordination and lessen 
the possibility or impact of differences between the Parties in the application of their 
competition laws. 
2. For the purposes of this Agreement, the following terms shall have the following 
definitions: 
A. "Competition law(s)" shall mean 
(i) for the European Communities, Articles 85, 86, 89 and 90 of the 
Treaty establishing the European Economic Community, Regulation 
(EEC) no. 4064189 on the control of concentrations between 
undertakings, Articles 65 and 66 of the Treaty establishing the 
European Coal and Steel Community (ECSC), and their implementing 
Regulations including High Authority Decision no. 24 54, and 
(ii) for the United States of America, the Sherman Act (15 U.S. C. §§ 1-7), 
the Clayton Act (15 U.S.C. §§ 72-27;, the Wilson Tariff Act (15 
U.S.C. §§ 8-11), and the Federal Trade Commission Act (15 U.S.C. 
§§ 41-68, except as these sections relate to consumer protection 
functions), 
as well as such other laws or regulations as the Parties shall jointly agree in 
writing to be a "competition law" for purposes of this Agreement; 
B. "Competition authorities" shall mean (i) for the European Communities, the 
Commission of the European Communities, as to its responsibilities pursuant to the 
competition laws of the European Communities, and (ii) for the United States, the 
Antitrust Division of the United States Department of Justice and the Federal Trade 
Commission; 
C. "Enforcement activities " shall mean any application of competition law by way of 
investigation or proceeding conducted by the competition authorities of a Party; 
and 
D. "Anticompetitive activities" shall mean any conduct or transaction that is 
impermissible under the competition laws of a Party. 
"?r 
Article II 
NOTIFICATION 
Each Party shall notify the other whenever its competition authorities become aware 
that their enforcement activities may affect important interests of the other Party. 
Enforcement activities as to which notification ordinarily will be appropriate include 
those that: 
a) Are relevant to enforcement activities of the other Party; 
b) Involve anticompetitive activities (other than a merger or acquisition) carried 
out in significant part in the other Party's territory; 
c) Involve a merger or acquisition in which one or more of the parties to the 
transaction, or a company controlling one or more of the parties to the 
transaction, is a company incorporated or organized under the laws of the 
other Party or one of its states or member states; 
d) Involve conduct believed to have been required, encouraged or approved by 
the other Party; or 
e) Involve remedies that would, in significant respects, require or prohibit 
conduct in the other Party's territory. 
3. With respect to mergers or acquisitions required by law to be reported to the 
competition authorities, notification under this Article shall be made: 
a) In the case of the Government of the United States of America, 
(i) not later than the time its competition authorities request, 
pursuant to 15 U.S.C. § 18a(e), additional information or 
documentary material concerning the proposed transaction, 
(ii) when its competition authorities decide to file a complaint 
challenging the transaction, and 
(Hi) where this is possible, far enough in advance of the entry of a consent 
decree to enable the other Party's views to be taken into account; and 
b) In the case of the Commission of the European Communities, 
(i) when notice of the transaction is published in the Official 
Journal, pursuant to Article 4(3) of Council Regulation no. 
4064/89, or when notice of the transaction is received under 
A? 
Article 66 of the ECSC Treaty and a prior authorization from 
the Commission is required under that provision, 
(ii) when its competition authorities decide to initiate proceedings 
with respect to the proposed transaction, pursuant to Article 
6(1 )(c) of Council Regulation no. 4064/89, and 
(Hi) far enough in advance of the adoption of a decision in the case to 
enable the other Party's views to be taken into account. 
With respect to other matters, notification shall ordinarily be provided at the 
stage in an investigation when it becomes evident that notifiable circumstances 
are present, and in any event far enough in advance of 
(a) the issuance of a statement of objections in the case of the Commission 
of the European Communities, or a complaint or indictment in the case 
of the Government of the United States of America, and 
(b) the adoption of a decision or settlement in the case of the Commission 
of the European Communities, or the entry of a consent decree in the 
case of the Government of the United States of America, 
to enable the other Party's views to be taken into account. 
5. Each Party shall also notify the other whenever its competition authorities 
intervene or otherwise participate in a regulatory or judicial proceeding that 
does not arise from its enforcement activities, if the issues addressed in the 
intervention or participation may affect the other Party's important interests. 
Notification under this paragraph shall apply only to 
a) regulatory or judicial proceedings that are public, 
b) intervention or participation that is public and pursuant to formal 
procedures, and 
c) in the case of regulatory proceedings in the United States, only 
proceedings before federal agencies. 
Notification shall be made at the time of the intervention or participation or 
as soon thereafter as possible. 
6. Notifications under this Article shall include sufficient information to permit an 
initial evaluation by the recipient Party of any effects on its interests. 
4*> 
Article I/I 
EXCHANGE OF INFORMATION 
1. The Parties agree that it is in their common interest to share information that will (a) 
facilitate effective application of their respective competition laws, or (b) promote 
better understanding by them of economic conditions and theories relevant to their 
competition authorities ' enforcement activities and interventions or participation of the 
kind described in Article II, paragraph 5. 
2. In furtherance of this common interest, appropriate officials from the competition 
authorities of each Party shall meet at least twice each year, unless otherwise agreed, 
to (a) exchange information on their current enforcement activities and priorities, (b) 
exchange information on economic sectors of common interest, (c) discuss policy 
changes which they are considering, and (d) discuss other matters of mutual interest 
relating to the application of competition laws. 
3. Each Party will provide the other Party with any significant information that comes 
to the attention of its competition authorities about anticompetitive activities that its 
competition authorities believe is relevant to, or may warrant, enforcement activity by 
the other Party's competition authorities. 
4. Upon receiving a request from the other Party, and within the limits of Articles VIII 
and IX, a Party will provide to the requesting Party such information within its 
possession as the requesting Party may describe that is relevant to an enforcement 
activity being considered or conducted by the requesting Party's competition 
authorities. 
Article IV 
COOPERATION AND COORDINATION 
IN ENFORCEMENT ACTIVITIES 
1. The competition authorities of each Party will render assistance to the competition 
authorities of the other Party in their enforcement activities, to the extent compatible 
with the assisting Party's laws and important interests, and within its reasonably 
available resources. 
2. In cases where both Parties have an interest in pursuing enforcement activities with 
regard to related situations, they may agree that it is in their mutual interest to 
coordinate their enforcement activities. In considering whether particular enforcement 
activities should be coordinated, the Parties shall take account of the following 
factors, among others: 
a) the opportunity to make more efficient use of their resources devoted to the 
enforcement activities; 
b) the relative abilities of the Parties' competition authorities to obtain 
information necessary to conduct the enforcement activities; 
c) the effect of such coordination on the ability of both Parties to achieve the 
objectives of their enforcement activities; and 
d) the possibility of reducing costs incurred by persons subject to the enforcement 
activities. 
3. In any coordination arrangement, each Party shall conduct its enforcement activities 
expeditiously and, insofar as possible, consistently with the enforcement objectives of 
the other Party. 
4. Subject to appropriate notice to the other Party, the competition authorities of either 
Party may limit or terminate their participation in a coordination arrangement and 
pursue their enforcement activities independently. 
n 
Article V 
COOPERATION REGARDING ANTICOMPETITIVE ACTIVITIES IN 
THE TERRITORY OF ONE PARTY THAT 
ADVERSELY AFFECT THE INTERESTS OF THE OTHER PARTY 
1. The Parties note that anticompetitive activities may occur within the territory of one 
Party that, in addition to violating that Party's competition laws, adversely affect 
important interests of the other Party. The Parties agree that it is in both their 
interests to address anticompetitive activities of this nature. 
2. If a Party believes that anticompetitive activities carried out on the territory of the 
other Party are adversely affecting its important interests, the first Party may notify 
the other Party and may request that the other Party's competition authorities initiate 
appropriate enforcement activities. The notification shall be as specific as possible 
about the nature of the anticompetitive activities and their effeas on the interests of 
the notifying Party, and shall include an offer of such further information and other 
cooperation as the notifying Party is able to provide. 
3. Upon receipt of a notification under paragraph 2, and after such other discussion 
between the Parties as may be appropriate and useful in the circumstances, the 
competition authorities of the notified Party will consider whether or not to initiate 
enforcement activities, or to expand ongoing enforcement activities, with respect to the 
anticompetitive activities identified in the notification. The notified Party will advise 
the notifying Party of its decision. If enforcement activities are initiated, the notified 
Party will advise the notifying Party of their outcome and, to the extent possible, of 
significant interim developments. 
4. Nothing in this Article limits the discretion of the notified Party under its competition 
laws and enforcement policies as to whether or not to undertake enforcement activities 
with respect to the notified anticompetitive activities, or precludes the notifying Party 
from undertaking enforcement activities with respect to such anticompetitive activities. 
Article VI 
AVOIDANCE OF CONFLICTS OVER ENFORCEMENT ACTIVITIES 
Within the framework of its own laws and to the extent compatible with its important interests, 
each Party will seek, at all stages in its enforcement activities, to take into account the 
important interests of the other Party. Each Party shall consider important interests of the 
other Party in decisions as to whether or not to initiate an investigation or proceeding, the 
scope of an investigation or proceeding, the nature of the remedies or penalties sought, and 
in other ways, as appropriate. In considering one another's important interests in the course 
of their enforcement activities, the Parties will take account of, but will not be limited to, the 
following principles: 
1. While an important interest of a Party may exist in the absence of official involvement 
by the Party with the activity in question, it is recognized that such interests would 
normally be reflected in antecedent laws, decisions or statements of policy by its 
competent authorities. 
2. A Party's important interests may be affected at any stage of enforcement activity by 
the other Party. The Parties recognize, however, that as a general matter the 
potential for adverse impact on one Party's important interests arising from 
enforcement activity by the other Party is less at the investigative stage and greater 
at the stage at which conduct is prohibited or penalized, or at which other forms of 
remedial orders are imposed. 
3. Where it appears that one Party's enforcement activities may adversely affect 
important interests of the other Party, the Parties will consider the following factors, 
in addition to any other factors that appear relevant in the circumstances, in seeking 
an appropriate accomodation of the competing interests: 
a) the relative significance to the anticompetitive activities involved of conduct 
within the enforcing Party's territory as compared to conduct within the other 
Party's territory; 
b) the presence or absence of a purpose on the part of those engaged in the 
anticompetitive activities to affect consumers, suppliers, or competitors within 
the enforcing Party's territory; 
c) the relative significance of the effects of the anticompetitive activities on the 
enforcing Party's interests as compared to the effects on the other Party's 
interests; 
d) the existence or absence of reasonable expectations that would be furthered or 
defeated by the enforcement activities; 
e) the degree of conflict or consistency between the enforcement activities and the 
other Party's laws or articulated economic policies; and 
V 
f) the extent to which enforcement activities of the other Party with respect to the 
same persons, including judgments or undertakings resulting from such 
activities, may be affected. 
Article VII 
CONSULTATION 
1. Each Party agrees to consult promptly with the other Party in response to a request 
by the other Party for consultations regarding any matter related to this Agreement 
and to attempt to conclude consultations expeditiously with a view to reaching 
mutually satisfactory conclusions. Any request for consultations shall include the 
reasons therefor and shall state whether procedural time limits or other considerations 
require the consultations to be expedited. 
These consultations shall take place at the appropriate level, which may include 
consultations between the heads of the competition authorities concerned. 
2. In each consultation under paragraph 1, each Party shall take into account the 
principles of cooperation set forth in this Agreement and shall be prepared to explain 
to the other Party the specific results of its application of those principles to the issue 
that is the subject of consultation. 
Article VIII 
CONFIDENTIALITY OF INFORMATION 
1. Notwithstanding any other provision of this Agreement, neither Party is required to 
provide information to the other Party if disclosure of that information to the 
requesting Party (a) is prohibited by the law of the Party possessing the information, 
or (b) would be incompatible with important interests of the Party possessing the 
information. 
Each Party agrees to maintain, to the fullest extent possible, the confidentiality of any 
information provided to it in confidence by the other Party under this Agreement and 
to oppose, to the fullest extent possible, any application for disclosure of such 
information by a third party that is not authorized by the Party that supplied the 
information. 
Article IX 
EXISTING LAW 
Nothing in this Agreement shall be interpreted in a manner inconsistent with the existing laws, 
or as requiring any change in the laws, of the United States of America or the European 
Communities or of their respective states or member states. 
Article X 
COMMUNICATIONS UNDER THIS AGREEMENT 
Communications under this Agreement, including notifications under Articles II and V, may 
be carried out by direct oral, telephonic, written or facsimile communication from one Party's 
competition authority to the other Party's authority. Notifications under Articles II, V and 
XI, and requests under Article VII, shall be confirmed promptly in writing through diplomatic 
channels. 
Article XI 
ENTRY INTO FORCE, TERMINATION AND REVIEW 
1. This Agreement shall be approved by the Parties in accordance with their respective 
internal procedures. 
The Parties shall notify one another of the completion of those procedures. 
2. This Agreement shall remain in force until 60 days after the date on which either 
Party notifies the other Party in writing that it wishes to terminate the Agreement. 
1Ï 
3. The Parties shall review the operation of this Agreement not more than 24 months 
from the date of its entry into force, with a view to assessing their cooperative 
activities, identifying additional areas in which they could usefully cooperate and 
identifying any other ways in which the Agreement could be improved. 
The Parties agree that this review will include, among other things, an analysis of 
actual or potential cases to determine whether their interests could be better served 
through closer cooperation. 
The undersigned, being duly authorized, have signed this Agreement. 
Done at Washington, in duplicate, this twenty-third day of September 1991, in the 
English language 
FOR THE COUNCIL OF THE EUROPEAN FOR THE GOVERNMENT OF 
UNION THE UNITED STATES OF AMERICA: 
FOR THE COMMISSION OF 
THE EUROPEAN COMMUNITIES; 
IC 
ISSN 0254-1475 
COM(94) 430 final 
DOCUMENTS 
EN 1108 
Catalogue number : CB-CO-94-457-EN-C 
ISBN 92-77-81111-0 
Office for Official Publications of the European Communities 
L-2985 Luxembourg