The U.S. Department of Justice’s recent action challenging a joint bidding arrangement for natural gas leases highlights the antitrust risks of joint bids. This newsletter describes considerations parties considering joint bids can take to evaluate and potentially manage their antitrust risks.
The U.S. Department of Justice (DOJ) recently announced a settlement requiring two companies that allegedly coordinated bids for oil and gas leases to pay a total of $550,000 in fines related to an agreement not to compete. The agreement in question allegedly related to joint bids for four natural gas leases sold at auction by the federal government. The DOJ noted this was the first time it had challenged an anticompetitive bidding agreement for the sale of governmental mineral rights.
This settlement highlights the fine line between pro-competitive and anti-competitive joint bids and sheds light on some of the landmines companies must avoid, especially in bidding situations not previously addressed by antitrust regulators.
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