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SARMA ANTITRUST POLICY
Overview
The purpose of this document is to describe the Security Analysis and Risk Management Association's (SARMA's) policies and procedures to ensure strict compliance with antitrust laws. It also is intended to alert members and staff of the activities most likely to raise antitrust concerns and the related precautions which must be implemented.
The antitrust laws are intended to ensure free and open competition. These laws, the Sherman Act, Clayton Act and Federal Trade Commission Act at the federal level and similar laws in many states and in other nations prohibit contracts, combinations, conspiracies, and other agreements in restrain of trade, as well as monopolization and attempted monopolization. An unlawful "agreement" or "conspiracy" among trade association members can exist without a formal written document. It may be oral or written, formal or informal, express or implied. Even casual conversations or so-called "off the record" remarks by association members or staff can provide the basis for an antitrust conspiracy claim.
Trade associations play a valuable and entirely lawful role in our economy. However, the very nature of trade associations the fact that they bring together competitors also means that such associations must be particularly sensitive to antitrust issues. In bringing competitors together, one element of a possible antitrust violation already is present -- a combination of competitors. All that may be needed to prove a violation is the action to restrain trade.
It is SARMA's firm and resolute policy, to which no exception is made, that all SARMA activities shall be conducted in strict conformity with all aspects of federal and state antitrust laws and, to the extent relevant, the laws of other nations. Violations of these laws can result in severe civil or even criminal penalties. Even if a government or private suit is successfully defended, the cost and disruption of the litigation can be overwhelming. Therefore SARMA will not condone any violation of its policy in this regard, and any member or employee who violates such policy will be subject to expulsion or discharge from SARMA.
1. Matters Involving Prices and Terms of Competition
(a) No SARMA activity shall be used as a means for effecting or discussing any understanding or agreement, written or oral, formal or informal, expressed or implied, among competitors or potential competitors with regard to such competitors' prices, terms and conditions of sale or purchase, marketing, distribution, production, consumption, market territories, or customers.
(b) No effort will be made by any SARMA body or member on behalf of SARMA to collect information from or disseminate information to members concerning prices, terms and conditions of sale or purchase, marketing, distribution, production, consumption, market territories, or customers, without prior clearance from the SARMA Board of Directors. In any event, no such effort will be made in regard to future or planned prices, terms and conditions of sale or purchase, marketing, distribution, production, consumption, market territories, or customers of members' services or products.
2. Matters Affecting Participation
(a) No SARMA activity shall be used as a means for effecting or discussing any understanding or agreement, written or oral, formal or informal, expressed or implied, to boycott or to exclude from competition any person, company, or other legal entity.
(b) No person or firm shall be unreasonably excluded from participating in SARMA activities. Efforts will be made to ensure that interested persons and firms will have access to SARMA activities. In certain circumstances, trade associations restrictions on membership can give rise to a claim that the association and its members participated in an unlawful group boycott of a rejected applicant for example, where denial of membership may have an effect in the marketplace. SARMA does not believe that SARMA membership is necessary to enable a firm or individual to compete in any market. In order to avoid any questions in this area, however, SARMA's definition of membership in the Bylaws and the implementation of the definition is carefully scrutinized to ensure that it is open and that adjustments in the interpretation or wording of the Bylaws to deal with modern marketplace realities are not being done with anti-competitive motivation or effects. The significance of whether a person or firm qualifies for SARMA membership is mitigated by the fact that, as discussed below, SARMA programs that have market impact are open to all interested participants regardless of membership.
(c) Consistent with paragraph 2(b) of this Policy, SARMA certification programs are based on tests that are open to all participants regardless of SARMA membership.
3. Suggestion of Standards, Specifications, Research and Statistics
(a) No effort will be made by any SARMA body or members on behalf of SARMA to conduct research projects, or to formulate any recommended industry standards or specifications, without prior clearance from the SARMA Board of Directors.
(b) All industry standards and specifications recommended by SARMA will be nonbinding suggestions of SARMA only, and no sanctions will be imposed by SARMA for noncompliance with or failure to adopt such standards or specifications. Each member of SARMA is expected to exercise independent judgment in using or not using the standards and specifications suggested by SARMA.
(c) All industry standards and specifications recommended by SARMA will be fair and equitable, will be in the public interest rather than any narrow or partisan interests of any SARMA member(s), and will be adopted only after a full opportunity to comment on the proposed standards and specifications has been afforded to all interested persons.
(d) With respect to market data and statistical activities:
- Reports should not identify the statistics of individual companies
- The provision of member data to support such activities is strictly voluntary
- Individual companies or customers should not be identified or be capable of identification
- A minimum number of participants in any market data or statistical activity will be required to prevent any participant from being able to calculate the market shares of other participants
- No data is gathered on actual prices
- There should be no editorial comment or analyses of the data if it relates to output or costs
- The data disseminated should be made readily available upon reasonable terms to both SARMA members and to non-members. Any fees required for non-members must be reasonably related to the cost of gathering and disseminating the data.
4. Fairness of SARMA Activities
All activities of SARMA are to be conducted fairly, responsibly, and in good faith, and with the intent, purpose, and effect of furthering the above stated purposes and goals of SARMA. Any SARMA body or member having any questions or concerns regarding the propriety of any activity being conducted by or on behalf of SARMA in light of this Antitrust Compliance Policy is encouraged to contact the SARMA President, the Chairman of the Board, or any officer of the Association. It is the intent and policy of SARMA to encourage such inquiries so that compliance to this policy may be ensured.
5. Public Interface/Political
(a) The SARMA Board of Directors, as the policy-making and governing body of the Security Analysis and Risk Management Association, endorses programs that seek to enhance the public's understanding of the profession. However, caution should be exercised by SARMA members participating in these programs that no impression of attempting to influence legislation exists. As a practice, no body of SARMA should undertake programs of a public or national policy nature without first advising the SARMA Board of Directors. Laws and regulations governing public information programs change frequently, and the SARMA Board, which has responsibility for actions of all SARMA units, is the only SARMA body authorized to approve programs in the public policy area.
(b) Contact by Government Enforcement Personnel or Others Outside SARMA: If an Association member or employee is contacted by a government official from the Justice Department, the Federal Trade Commission, any federal or state agency or by a private party with regard to a pending or contemplated antitrust matter, SARMA's policy is to courteously decline to answer any questions and refer the party to General Counsel for a response. Additionally, if a staff member receives a summons, subpoena or any other legal document or form of written communication from such a party, the staff member should promptly note the date and time received on a separate paper and forward the document and separate paper to the General Counsel. Members and staff should not attempt to interpret or respond to the document. |
