Corda Network Foundation Document history

Anti-Trust

1 Introduction

Organizations such as the Foundation and its Participants (as well as the Operator which applies its own Antitrust Guidelines), which may be current or potential competitors, are subject to close scrutiny under antitrust laws in the European Union, the U.S. and other jurisdictions. These laws generally prohibit express or implied agreements among market competitors that have an anti-competitive impact. Such conduct – even if inadvertent or undertaken in connection with a legitimate objective – can give rise to substantial criminal or administrative penalties and civil liabilities under European Union, U.S. and other antitrust Laws. The Foundation, its Participants, the Board and each Board Committee must exercise diligence, procedurally and substantively, to ensure that their activities are conducted within all parameters established by these laws, both as a matter of appearance and in actual fact.

The following guidelines are designed to assist the Foundation, its Participants, the Board and each Board Committee in guiding their conduct relating to their discussions and exchanges and the activities of the Foundation. In addition, these guidelines should be made available to, and followed by all individuals representing the Foundation, its Participants, the Board and other persons who participate in the Board or any Board Committee meetings, discussions and exchanges regarding the Foundation and its initiatives. Furthermore, these guidelines are not intended to be exhaustive; rather they are intended to provide and serve as general guidance.

Antitrust Counsel should be consulted in the event of any questions concerning the meaning or implementation of these guidelines or their application in a particular instance.

2 Practices to Follow

  • Matters bearing on competitive relations between or among the Participants, or other competitively sensitive information of the Participants, should not be discussed between or among the Participants or at any Participant, Board or Board Committee meetings.
  • Prepare an agenda for each meeting of the Participants, the Board and each Board Committee, limited to matters required for the furtherance of the business of the Foundation and distribute the agenda to all attendees prior to the applicable meeting.
  • To the extent appropriate, limit discussion at each meeting of the Participants, the Board and each Board Committee to the agenda items.
  • Have minutes taken of each meeting of the Participants, the Board and each Board Committee which accurately reflect the subjects discussed, decisions made or actions taken, and the persons in attendance, and promptly distribute the minutes to all attendees for review. Do not maintain unofficial minutes of any meetings of the Participants, the Board or each Board Committee.
  • Confine group discussions of all matters relating to the Foundation, to the Board or the applicable Board Committee to the activities of the Foundation.
  • Consult with Antitrust Counsel on all antitrust questions, or matters that may give rise to an antitrust question, relating to the activities of the Foundation.
  • Advise Antitrust Counsel or Chairman of the Board, as applicable, of any possible violations of these guidelines.

3 Conduct to Avoid

The matters identified below should not be discussed or be the subject of informational exchanges, whether seriously or in jest, and no agreements should be made with respect to any such matters, at any meeting of the Participants, the Board or a Board Committee, at any other gathering incidental to a meeting any of the foregoing, or by any other means:

  • Except to the extent necessary to further the business of the Foundation (and in that event, only where the scope of any discussions has been reviewed in advance with Antitrust Counsel), Participant-specific competitively sensitive information, including pricing policies or patterns, price levels, price differentials or similar matters, sales or trading levels or inventories, or access to particular markets or services (including planned or anticipated changes in any of the foregoing).
  • Territorial restrictions, allocations of customers, restrictions on types of products or services, or any other kind of market division or any suggestions of any of the foregoing.
  • Present or future prices of services or products of Participants or any suggestions of any of the foregoing, whereby for the avoidance of doubt the Foundation as such and/or Participants can discuss and decide on the services (to be) procured from the Operator and the latter’s pricing at arm’s length thereof.
  • Volumes of transactions or other commercial activities, services or products.
  • Current or future business strategies and marketing plans.
  • Competitively sensitive business practices of individual Participants, including but not limited to the following:
    • Recent, intended or proposed trades, including information on pricing and pricing terms (e.g., discounts, commissions, bid-offer spreads, fees), volume of orders, client identities, client orders/requests, and intent to offer/execute;
    • Current or recent information on margins and profitability of trading positions.
    • Participant or client trading strategies; and
    • Pricing strategies and policies, including both general and client-specific strategies and policies, and terms with brokers or other intermediaries.
    • Any refusal to deal with actual or potential competitors, customers or suppliers.
    • Any other discussion or exchange of information, that in actuality or even in appearance, could constitute an agreement to lessen competition among the Participants or that might have the effect of excluding actual or potential competitors, customers or suppliers from any market or influencing the business conduct of any person with respect thereto.

In addition, any unilateral exchange of information between a Participant, on the one hand, and the Foundation, on the other hand, which may contain competitively sensitive information should be reviewed with Antitrust Counsel.

4 Antitrust and Standardisation

Antitrust rules recognize that standardisation may give rise to antitrust concerns in circumstances where:

  1. Standardisation could result in restrictions on price competition (e.g. through illegal information exchange amongst competitors – see section 3)
  2. It could limit or control production, markets, innovation or technical development (e.g. by foreclosing innovation, technologies or certain companies access to the standard).

The risk under (1) should be addressed by guidance on what can and cannot be shared amongst competitors (see previous sections and when in doubt, contact Antitrust Counsel. The risk under (2) should be significantly mitigated if:

  • Participation in the standard-setting is unrestricted such that all competitors in the affected market are able to participate;
  • The procedure for adopting the standard in question is transparent;
  • The standardisation agreements contain no obligation to comply with the standard;
  • The standard provides access on fair, reasonable and non-discriminatory (FRAND) terms; and
  • The IPR policies (to the extent applicable) are clear and balanced with a view to ensuring effective access to the standard (including good faith disclosure, by participants, of their IPR that might be essential for the implementation of the standard under development).

If the envisaged standardization does not meet these principles, there is no presumption that it would then restrict competition but an assessment would be required by Antitrust Counsel.