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View the related business review
FOR IMMEDIATE RELEASE AUGUST 14, 1998 |
AT (202) 616-2771 TDD (202) 514-1888 Website: www.usdoj.gov |
JUSTICE DEPARTMENT APPROVES PLAN BY NATIONAL
ASSOCIATION OF MANUFACTURERS TO SET UP PLAN TO RESOLVE YEAR 2000 ISSUES
WASHINGTON, D.C. -- In a step designed to assist a broad segment of
the private sector in resolving Year 2000 computer issues, the Department
of Justice today approved a proposal by the National Association of
Manufacturers (NAM) to let its members and their computer services suppliers
discuss and exchange information on the issues.
The Department's Antitrust Division approved the private sector information-
sharing proposals after being asked by NAM to consider their competitive
implications. The Department concluded that an exchange program, limited
to information about the existence of and remedies for Year 2000 computer
conversion problems, would not pose competitive risks.
The Department also said that the information exchanges might even
have procompetitive effects by reducing costs and/or speeding up resolution
of Year 2000 issues.
The Department's position was stated in a business review letter issued
by Joel I. Klein, Assistant Attorney General in charge of the Department's
Antitrust Division.
NAM is the nation's oldest and largest broad-based industrial trade
association. Its nearly 14,000 member companies and subsidiaries, including
10,000 small manufacturers, employ about 85 percent of all manufacturing
workers and produce more than 80 percent of the nation's manufactured
goods. More than 158,000 additional businesses are affiliated with the
NAM through its Associations Council and National Industrial Council.
Many firms utilize computer systems designed with software programmed
to operate with data fields that use two digits to indicate a given
year. As a consequence, on January 1, 2000 these computer programs may
interpret the double zero as either the year 1900 or zero rather than
the year 2000, and as a result fail to function properly. There is a
concern that, unless remedied, the Year 2000 issue could cause a breakdown
in many computerized information systems utilized in various U.S. industries.
Similar concerns have been expressed with respect to certain governmental
activities. Indeed, the President has established a Council on the Year
2000 Conversion to encourage governmental agencies and private industry
to take the steps necessary to resolve potential Year 2000 conversion
issues in advance of January 1, 2000.
NAM is in the process of building an internet web site with a directory
of companies and their Year 2000 information. All information relating
to Year 2000 problems and solutions will be maintained on the web sites
of participating companies and organizations, and will be linked through
NAM's central directory and search engine. The information on the company
or organizational web sites linked to the NAM directory will consist
of a variety of possible materials. Some will identify hardware, software
or other products that are believed to be "Year 2000 compliant."
Others will identify items that clearly are not compliant, or that may
not be ready by January 1, 2000.
Under this internet-based program, companies in a wide variety of industries
will be able to review the Year 2000 information of their competitors,
suppliers and customers. Information made available to interested persons
through the NAM directory will be available for downloading or printing,
and it is expected that such information will be distributed individually
from company to company and through group or association distributions.
NAM intends to keep its directory as open as possible to create a data
base with web site information relating to Year 2000 compliance from
all types of companies. NAM membership will not be a condition of access
to the Year 2000 information. Vendors whose products or services are
discussed on linked web sites will have the opportunity to provide their
own perspective on their own web sites, which will also be linked to
the NAM directory. NAM will have no control over the extent to which
information placed on its Year 2000 web site will be shared by and among
companies, organizations or members of the public.NAM hopes that this
free dissemination of their Year 2000 problems.
NAM also hopes to promote non-internet exchanges of Year 2000 information
on a bilateral, or company-to-company basis. It suggests that this type
of bilateral information sharing is most important for companies that
are not linked to the Internet or that are not proficient in its use
or the use of the NAM directory. It believes that a substantial number
of companies, particularly small and medium sized manufacturers, do
not have the time or resources to be fully integrated with Internet
communications, and will have to rely on other communications methods
that are not as easily distributable to large groups of people.
"Based on the information provided to us by NAM and the nature
of the information to be exchanged, i.e., related solely to Year 2000
computer conversion issues, the Department does not believe the proposed
conduct will have anticompetitive effects," Klein noted. He added
that while "the Department would be concerned if parties, under
the guise of a Year 2000 remedial program, exchange price or other competitively-sensitive
information, agreed not to compete for particular business, agreed not
to deal with certain suppliers or entered into other anticompetitive
agreements, . . . such potentially anticompetitive actions are not necessary
to any The Department concluded, "that information exchanges that
are limited to identifying and remedying Year 2000 computer transition
problems either in general or in relation to specific hardware or software
are not likely to be anticompetitive because such limited information
exchanges should not reduce price or innovation rivalry, or lessen competition
in the procurement of computers or computer services."
Finally, Klein observed that it is "possible that information
exchanges limited to identifying and/or remedying Year 2000 conversion
problems could be procompetitive. If there is insufficient time and/or
skilled personnel to enable many firms to remedy their Year 2000 computer
conversion problems in a timely manner, information exchanges such as
those that NAM proposes could increase output by reducing redundant
efforts and fostering more efficient prioritization of the remedial
work that must be done."
Under the Department's business review procedure, a person or organization
may submit a proposed action to the Antitrust Division and receive a
statement as to whether the Division will challenge the activity as
a violation of federal antitrust laws.
A file containing the business review request and the Department's
response may be examined in the Antitrust Documents Group, Suite 215,
Liberty Place, 325 7th Street, N.W., Washington, D.C. 20530.
After a 30-day waiting period, the document supporting the business
review will be added to the file.
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