FTC Puts an End to Bleach Non-Compete Agreement That Whitewashed Competition in North Carolina, South Carolina, and Southern Virginia
The Federal Trade Commission will require bleach producer and seller Oltrin Solutions, LLC to release its competitor, JCI Jones Chemicals, Inc. from an agreement not to sell bleach in North Carolina and South Carolina.
(Media-Newswire.com) - The Federal Trade Commission will require bleach producer and seller Oltrin Solutions, LLC to release its competitor, JCI Jones Chemicals, Inc. from an agreement not to sell bleach in North Carolina and South Carolina. This non-compete agreement was part of a 2010 transaction between the two firms that the FTC alleges violated antitrust laws. The FTC’s settlement with Oltrin and JCI will restore competition between these two producers and sellers of bulk bleach, which is primarily used to disinfect water.
Oltrin is a limited liability company headquartered in Hamlet, North Carolina. Formed in 2007, it is owned jointly by Trinity Manufacturing, Inc. and TriOlin LLC, a subsidiary of Olin Corporation, the largest North American bleach producer. Oltrin buys and resells all of the bleach produced for merchant sale at the Trinity-operated plant in Hamlet.
JCI is a privately held company headquartered in Sarasota, Florida. It is one of the world’s leading producers and distributors of water treatment chemicals, and produces bleach and other chemicals at 11 plants throughout the United States. Before the 2010 transaction with Oltrin, JCI produced bleach at its plant in Charlotte, North Carolina.
Bulk bleach is primarily used by municipal and industrial customers to disinfect water. According to the FTC’s complaint, bulk sales of bleach typically consist of purchases of 4,500 or 4,800 gallons. The geographic market for such sales is limited by the expense of transporting it. In this case, the FTC has defined the relevant geographic market as no broader than North Carolina, South Carolina, and southern Virginia, and potentially limited to North Carolina and South Carolina. All of these areas are within 300 miles of JCI’s former bleach production plant in Charlotte, North Carolina.
According to the FTC, in March 2010, Oltrin agreed to pay JCI $5.5 million for, among other things, a list of bulk bleach customers from JCI’s Charlotte plant, along with an agreement that JCI would not sell bulk bleach in North Carolina or South Carolina for six years. The FTC contends that the deal between the two firms eliminated substantial competition between Oltrin and JCI in the relevant geographic market; substantially increased the market concentration for bulk bleach sales in the relevant geographic market; and increased Oltrin’s ability to raise bulk bleach prices.
The proposed consent order is designed to restore the competition lost through the 2010 transaction. It requires Oltrin to release JCI from the non-compete agreement, transfer a minimum volume of its bulk bleach contracts back to JCI, and provide a short-term backup supply agreement that will facilitate JCI’s re-entry into the bulk bleach market in North Carolina and South Carolina.
In addition to these provisions, the proposed order requires that Oltrin and JCI notify the FTC before entering into any future transactions in the bulk bleach market, and that Oltrin notify any customers from which it has received bids since the 2010 agreement that JCI is once again in the bulk bleach business in the relevant geographic market.
The Commission vote approving the complaint and proposed settlement order was 5-0. The order will be subject to public comment for 30 days, until February 21, 2013, after which the Commission will decide whether to make it final. Comments should be sent to: FTC, Office of the Secretary, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Comments can be submitted electronically.
NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The issuance of a complaint is not a finding or ruling that the respondent has violated the law. A consent agreement is for settlement purposes only and does not constitute an admission of a law violation. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of $16,000.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC's online Complaint Assistant or call 1-877-FTC-HELP ( 1-877-382-4357 ). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources. MEDIA CONTACT: Mitchell J. Katz, Office of Public Affairs 202-326-2161 STAFF CONTACT:Eric M. Sprague, Bureau of Competition 202-326-2101
This story was released on 2013-01-23. Please make sure to visit the official company or organization web site to learn more about the original release date. See our disclaimer for additional information.