| 6/2/93 |
Department of Justice
Issues Business Review Letter
In a letter from John
W. Clark, Acting Assistant Attorney General in charge of the Antitrust
Division, to Suzanne E. Harley, counsel for the Nickel Users Purchasing
Association, Inc. ("NUPA"), the Department announced that it does
not intend to challenge the formation of NUPA. NUPA, a for-profit
corporation, will negotiate and purchase primary nickel and arrange
for resale, warehousing, storing, insuring and shipping of primary
nickel for its members. NUPA's membership will be open to U.S.
purchasers of primary nickel, a material that is used in manufacturing
processes, melted or processed into alloys, or used in making
steel. Customers of primary metal products include the resistance
heating, automotive specialty, aerospace, nuclear and stainless
steel industries. Clark said the proposal does not appear likely
to reduce competition in the market for the purchase of primary
nickel since annual U.S. consumption represents approximately
15 percent of what is a world market. Also, the proposal is likely
to be procompetitive because it could create efficiencies that
would result in lower prices both for nickel and nickel-based
products manufactured by members. Clark also stated that while
there was some risk that the venture could facilitate coordinated
behavior, that risk was not substantial given the safeguards adopted.
These safeguards involve the use of
an independent administrator who will negotiate with nickel producers
and maintain the confidentiality of the negotiations. NUPA has
also adopted procedures to ensure there is no exchange of competitively
sensitive information through meetings or otherwise.
|
