1. Anticompetitive Agreements

Definition

Agreement refers to any type or form of contract, arrangement, understanding, collective recommendation, or concerted action, whether formal or informal, explicit or tacit, written or oral. (Sec. 4[b])¹

Conduct refers to any type or form of undertaking, collective recommendation, independent or concerted action or practice, whether formal or informal. (Sec. 4[c])²

Note: Forms that Anti-Competitive Agreements may take:

• Horizontal Agreements – exist between firms (suppliers or consumers) at the same level of the production chain. An example of this is when firms agree on a price. This shows that the combined firms have influence over the price.
• Vertical Agreements – exists where firms at different stages of the production chain collude. Typically, it happens between suppliers and users. This may relate to price or other matters (i.e. quotas, exclusive dealings, etc.).

i. Per se violations

The following agreements, between or among competitors, are per se prohibited:

• Restricting competition as to price, or components thereof, or other terms of trade (Price-fixing) (Sec. 14 [a])³;
• Fixing price at an auction or in any form of bidding including cover bidding, bid suppression, bid rotation and market allocation and other analogous practices of bid manipulation; (Bid Rigging) (Sec. 14 [a])

Note: A per se violation is always illegal. The agreements listed in Section 14(a) are prohibited per se, without proof of a substantially anti-competitive object or effect. Agreements under Section 14(b) or (c) may be prohibited if they have the specified object or effect, subject to the applicable statutory qualifications.