HKB 121/10
RECE! DIN EGISTRY
1.
Mr Whitney
NFA for w.
2. PA with previous paper plze
(6
AAB
16/7
Mr K A Salkeld
Trade and Industry Branch Government Secretariat
Hong Kong Government
Hong Kong
Misy
REGISTRY
Lower Albert Road
BY FAX (010 852 840 1621)
this
INDE
outstanding subject
071 215 5329
bcc
Direct line
Mr Green
NL 4/07
Our ref
Ms Turner
(6) in TIB L/M 58/93
Your ref
Mr Sack
14 July 1993
Date
Mr Whitney
Dear Mr Salkeld
نع
Mr Whitehorn Mr Hosker
20 JUL 1993
PA
Sols D5 CP2b CP1
this
Action Taken
Department of Trade
and Industry
Kingsgate House
66-74 Victoria Street London SW1E 6SW
Enquiries
071-215 5000
Telex 8813148 DIHQ G
Fax 071-931 0397
HKD, FCO CP5, OFT
British Embassy, Washington
BY FAX
US ANTI-TRUST NOTIFICATION: PROPOSED ACQUISITION OF MAJORITY SHARE IN G.M. PFAFF.AG (GERMANY) BY SEMI-TECH (GLOBAL) CO. LTD. (HONG KONG)
Thank you for your letter of 1 June on the above.
In my letter of 14 May to Mr Siu, I noted that we had asked the US authorities for clarification on a number of points in relation to the investigation of this acquisition. During a recent trip to North America I met an official from the US Federal Trade Commission (FTC), and took the opportunity to discuss the case with him. He confirmed that the FTC had decided not to pursue this matter.
You may nonetheless be interested in the background information provided by the FTC as to their thinking in this case. The FTC justified its investigation by reference to the "effects doctrine"
under US anti-trust laws, for the US
US to claim jurisdiction, it is only necessary that the parties under investigation be deemed to be doing something in the US which might have an effect on the US market. In this instance, the connection with the US was the selling of sewing machines.
While the FTC had not been certain that the acquisition would lead to a concentration of market power in the hands of the merged company, it had felt that such an outcome was sufficiently likely to justify an investigation. This had taken the form of contacting customers and competitors of the companies, seeking information on a voluntary basis. While the FTC had not in the event talked to anyone in Hong Kong, it indicated that this might have been a possibility.
dti
the department for Enterprise
Bomycled Paper