Benchmarking, Joint Operations, and Antitrust Law: Boundaries For Cooperation Among Competitors in the Oil and Gas Industry
In recent years, U.S. companies increasingly have entered into collaborations1 as a means of expanding into international markets, funding expensive innovations, and lowering costs.2 Many companies lack the capital, labor force, or technology to “go it alone” on a particular project, which has driven the need for alternative business arrangements. Energy companies in particular are drawn to collaborations to offset the cost of large-scale exploration, to share the risks and benefits of ownership, and to access international markets.
While businesses are lured by the benefits collaborations can offer, antitrust lawyers continue to be challenged by the new and complex ways they take shape. Collaborative agreements come in a variety of forms and can involve diverse participants, functions, operations, and goals. Antitrust analysis requires a fact-specific [31-3] assessment of economics, market conditions, efficiencies, integration, and numerous other factors. The good news is that in the last 15 years, both courts and enforcement agencies have increasingly recognized the procompetitive benefits of collaborations. Still, pitfalls are plentiful, and with the threat of criminal penalties and stiff civil damages looming, the stakes for understanding the antitrust laws have never been higher.
This chapter aims to provide an antitrust roadmap on forming, operating, and partici
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