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The Franchise Memorandum

Federal Trade Commission and Justice Department Issue Expedited Antitrust Procedure and Guidance for Coronavirus Collaborations

The FTC and the DOJ Antitrust Division issued a joint statement that details expedited antitrust procedures and provides guidance for collaborations of businesses working to protect the health and safety of the American people during the COVID-19 pandemic. The full text of the joint statement is available here. The joint statement recognizes that health care facilities may need to work together to provide resources and services to assist patients, consumers, and communities affected by the COVID19 pandemic, and that other businesses may need to temporarily combine production, distribution, or service networks to facilitate production and distribution of COVID-19-related supplies. Under the new procedure, the FTC and the DOJ will respond to COVID-19-related requests, and resolve those requests addressing public health and safety, within seven calendar days of receiving all information necessary to vet such proposals.

The new procedure allows any firm, individual, or group of firms or individuals to submit a proposal and receive a statement advising whether the proposed activity would be challenged by the FTC and the DOJ under antitrust laws. The applicant must submit a written description of the proposal, which includes the parties that would be involved in the effort or activity, and the contact information of a person from whom the agencies could obtain additional information. The expedited procedure is only for use for COVID-19 related public health efforts and may be invoked at the option of the requestor instead of using standard procedures for handling requests for advice. The joint statement lists several types of collaborative activities designed to improve the health and safety response to the pandemic that would likely be consistent with antitrust laws. The joint statement notes, however, that the FTC and DOJ will not hesitate to hold accountable businesses and individuals who try to use the COVID-19 pandemic to engage in antitrust violations or take advantage of the pandemic through other fraudulent or illegal schemes.

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The Franchise Memorandum is a collection of postings on summaries of recent legal developments of interest to franchisors brought to you by Lathrop GPM LLP. 

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