SEMPO activities are a coordinated effort among competitors in the online marketing industry and are, therefore, subject to antitrust laws. Although this coordination is perfectly legal under U.S. antitrust laws, we want to make sure that no antitrust risks are raised by the manner in which the SEMPO program is carried out. Accordingly, these guidelines may go somewhat beyond the prohibitions of the law, but that is done in the interest of safety.
The penalties for violating antitrust laws can be quite severe, including large fines and even imprisonment of individuals found guilty of illegal conduct. Contrary to the popular belief that the government has relaxed antitrust enforcement, in recent years the Justice Department has recommended jail sentences for the majority of persons convicted of violating antitrust laws. Moreover, the U.S. Supreme Court has ruled that a trade association may be held legally responsible for the unauthorized, as well as authorized, acts of its members. Accordingly, every effort must be made to avoid even the appearance of impropriety.
As a basic premise, the goals of SEMPO are clearly lawful. The proposed activities, if properly conducted, will not be found to violate the antitrust laws because they will not have an adverse effect on the competitive market place.
SEMPO relies heavily on the judgment of SEMPO staff members to see that topics which may give an appearance of an agreement that would violate antitrust laws are not discussed at SEMPO meetings. The presence of a SEMPO staff member at a meeting, however, should not invite probing to determine how far a discussion can proceed before it becomes apparent that it is improper and is cut off. Each SEMPO member has the responsibility in the first instance to avoid raising improper subjects for discussion. This reminder has been prepared to ensure that participants in SEMPO meetings are aware of this obligation.
The most common violations of the antitrust laws are agreements among competitors to fix prices or allocate customers. As for SEMPO, the most important thing to keep in mind is that its purpose is to promote the search engine marketing industry, sponsor education and training and conduct research. SEMPO does not market particular services or products. Accordingly, it is not the business of SEMPO to consider or discuss matters relating to product development marketing, purchasing, or pricing decisions of individual companies.
The Do’s and Don’ts presented below highlight only the most basic antitrust principles. Participants in SEMPO meetings should consult counsel in all cases involving specific situations, interpretations, or advice.
- DO NOT IN FACT OR APPEARANCE, discuss or exchange information regarding:
- Individual company current or projected prices, price changes, price differentials, markups, discounts, allowances, terms and conditions of sale, including credit terms, etc., or data that bear on prices, including profits, margins or cost.
- Industry pricing policies, price levels, price changes, differentials, or the like.
- Changes in industry production, capacity, or inventories.
- Individual company bids or intentions to bid for particular products, procedures for responding to bid invitations, or specific contractual arrangements.
- Plans of individual companies concerning the design, characteristics, production, distribution, marketing, or introduction dates of particular products, including proposed territories or customers.
- Matters relating to actual or potential individual suppliers that might have the effect of excluding them from any market or of influencing the business conduct of firms toward such suppliers or customers.
- Individual company current or projected cost of procurement, development, or manufacture of any product.
- Individual company market shares for any product or for all products.
DO NOT discuss or exchange information regarding the above matters during social gatherings incidental to SEMPO-sanctioned meetings, even in jest.
- Adhere to prepared agendas for all SEMPO meetings.
- Insist that meeting minutes be prepared and distributed to all participants and object whenever meeting minutes do not accurately reflect the matters which transpired.
- Understand the purposes and authority of each SEMPO committee or other group in which you participate.
- Consult with SEMPO’s legal counsel or your company counsel on all antitrust questions related to SEMPO meetings.
- Protest against any discussions or meetings which appear to violate the antitrust laws, disassociate yourself from any such discussions or activities, leave any meeting in which they continue and report the activity to the SEMPO Executive Director so that similar conduct can be avoided in the future.
SEMPO’s policy is to discuss thoroughly with legal counsel any proposed programs or policy decisions before they are implemented. If any participant has a question as to the legality of a proposed course of action, the matter should be immediately referred to the SEMPO Executive Director who will discuss it with legal counsel. In this manner, SEMPO can ensure continued pursuit of its legitimate objectives with maximum protection for its participants.