Colombia: Collaboration amongst competitors as a response to COVID-19

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The Superintendence of Industry and Commerce (“SIC”) issued Resolution 20490 on April 11, which refers to joint ventures and agreements between competitors regarding the sanitary emergency triggered by COVID-19.

As a general rule in Colombian law, agreements between competitors with the purpose or effect of restricting competition are illegal. However, the SIC has recognized that certain agreements between competitors that join forces or resources to reach certain objectives –known as “collaboration agreements”- may be beneficial to the market and consumers. The SIC has established that a collaboration agreement is not anti-competitive if (i) it produces efficiencies, (ii) the agreement is necessary to achieve those efficiencies, (iii) enhances consumer welfare, and (iv) does not eliminate competition substantially in the market.

In regards to agreements aimed at the COVID-19 emergency, Article 1 of Resolution 20490 indicates that any collaboration agreement in the matter is presumed to generate efficiencies, fulfilling the first criterion. In any case, the parties must make sure that any agreement fulfills the remaining criteria.

Additionally, the SIC imposes the obligation to the parties of a collaboration agreement to inform them to the Deputy Superintendence for Competition Protection, indicating:

  1. The projected agreement,
  2. Parties,
  3. Affected goods and services,
  4. The specific content of the agreement, and
  5. Duration

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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