Nonmerger competition and consumer protection investigations; disclosures; policy statement,

[Federal Register: November 13, 1998 (Volume 63, Number 219)]

[Notices]

[Page 63477-63478]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr13no98-80]

FEDERAL TRADE COMMISSION

Policy Concerning Disclosures of Nonmerger Competition and Consumer Protection Investigations

AGENCY: Federal Trade Commission.

ACTION: Notice of revised policy.

SUMMARY: The Federal Trade Commission is revising its policy concerning disclosure of investigations. The Commission's policy, subject to specified exceptions, is to conduct its investigations on a nonpublic basis. The revised policy permits limited disclosures about nonmerger investigations where: A target has publicly disclosed the relevant information in either a press release or a filing with a government agency; or the investigation or the practice has received substantial publicity and the disclosure does not identify a target that has not already disclosed its own identity. Inquiries seeking disclosure under this authority should be addressed to the Commission's Office of Public Affairs.

EFFECTIVE DATE: The policy is effective on November 13, 1998. The Commission will, however, accept comments on the policy that are received on or before December 14, 1998 and may re-evaluate the policy in light of those comments.

FOR FURTHER INFORMATION CONTACT: Victoria A. Streitfeld, Office of Public Affairs, 202-326-2718, or Debra A. Valentine, General Counsel, 202-326-2481.

SUPPLEMENTARY INFORMATION: Commission policy is to hold confidential the existence and targets of law enforcement investigations until the Commission issues an administrative complaint, authorizes or files a judicial complaint, announces a proposed settlement, or closes a matter. See 42 FR 64135 (1977). The Commission believes generally that public disclosure of pending investigations and identification of targets before the Commission has had an opportunity to weigh the evidence may unjustifiably harm the companies investigated and interfere with the conduct and successful resolution of such matters. However, the Commission's policy has long included exceptions for disclosure of industrywide investigations and of investigations that involve significant risk of economic harm or risk to public health or safety. Id. More recently, the Commission announced a further exception that permits its Office of Public Affairs (``OPA'') to disclose that the agency is investigating a merger or similar transaction where a party to the underlying transaction had announced it in a press release or a public filing with a governmental body. 62 FR 18630 (1977).\1\

\1\ An investigation may also be disclosed because of a petition to limit or quash compulsory process. See 16 CFR 4.9(b)(4).

The first aspect of the modified policy applies if a target has publicly disclosed, in either a press release or a filing with a government agency, that it is the subject of a nonmerger investigation. In such cases, OPA could: (1) Confirm information that the target has already disclosed, to the extent that such information bears on the investigation of that target, and (2) with the approval of a Director or Deputy Director of the Bureau of Competition or Consumer Protection, disclose limited additional information about the general nature and scope of the investigation. These limited additional disclosures, which might be needed to correct misimpressions, could not identify additional targets that have not already identified themselves. This aspect of the policy contemplates, for example, disclosures that the Commission is investigating competitive practices in a particular industrial sector or that it is investigating a type of claim for a particular category of product. It also permits disclosure, in appropriate cases, of whether an investigation is wide-ranging or narrow in scope.

The second aspect of the modified policy permits OPA to make limited disclosures about the general nature and scope of a nonmerger investigation in unusual cases where there has been substantial publicity about the investigation or the underlying practice. See Also United States Attorneys' Manual (1997) Ch. 1-7.530 (allowing comments about an investigation in ``unusual circumstances'' where a matter has received substantial publicity). These limited disclosures of the general nature and scope of an investigation, like the disclosures contemplated above, are permitted only if approved by the relevant Bureau Director or Deputy Director. As a general rule, ``substantial publicity'' consists of, among other things, significant factual material concerning the investigation or the underlying practice that has appeared in the print or electronic media. By contrast, ``substantial publicity'' does not include mere rumors or statements, for which journalists seek confirmation by the Commission, that have not already been independently corroborated by significant coverage in the print or electronic media.

In addition, where an investigation can be disclosed under the conditions

[[Page 63478]]

set forth above and the recipient of compulsory process announces that the Commission has issued such process, the policy permits confirmation of such process.

Nothing in this notice shall be construed as modifying the authority of the Commission (as opposed to the Commission's staff) to make appropriate disclosures concerning nonpublic investigations whenever it determines that doing so would be in the public interest. The Commission will continue to keep confidential, as appropriate under its existing laws and policies, nonpublic information submitted to the agency.

By direction of the Commission. Donald S. Clark, Secretary.

[FR Doc. 98-30372Filed11-12-98; 8:45 am]

BILLING CODE 6750-01-M