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Corporate Communications and Antitrust

Our antitrust compliance programs usually focus on the kinds of things that salespeople and midlevel executives might say or write that can cause problems down the line. You've already probably heard more than you care to about e-mails suggesting "cutting off the air supply" of a competitor and slides claiming that you "dominate" an industry. Lots of you have helped to create responsible, compliance-driven corporate cultures in which your clients, even the self-starters among them, think first--and better yet, consult you--before they commit any bold new idea to paper or your shared drive.

And though it's hard to prove, that culture saves your clients a lot of heartache. With machine-readable electronic document productions the order of the day, poor choices of words are not likely to escape attention the next time your company has a big merger in front of the Department of Justice (DOJ) or Federal Trade Commission (FTC). By helping your people understand that the enforcement agencies take what they say seriously--maybe even more than your people do themselves--you help your company avoid all kinds of bad outcomes.

That was all in response to just one question. But later the CEO really turned up the antitrust heat, explaining that U-Haul had only two "major competitors, ... you get some price leadership and it manages itself okay," except when "somebody decides they have to gain share from somebody that you get this kind of turbulence that results in no economic gain for the group, in fact probably an economic loss." That's what antitrust people call an oligopoly, and it's a big area of concern these days for the agencies, who worry that in an oligopoly, firms don't even need to actually agree in order to hurt competition.

So, the CEO added, "every time we get what we consider to be an opportunity [to 'exercise price leadership'], it's another indicator to [Budget] as to, hey, don't throw the money away. Price at cost at least. If you feel a need to discount then price to cost, not below your cost. . . . And if they perceive that we'll let them come up a little bit, I remain optimistic they'll come up, and it has a profound effect on us."

Chris Kelly

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