[Federal Register Volume 66, Number 37 (Friday, February 23, 2001)]
[Notices]
[Pages 11317-11328]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-4517]


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DEPARTMENT OF JUSTICE

Antitrust Division

[Civil No. 00-3006]


United States of America v. Aktiebolaget Volvo, Trucks North 
America, Inc., Renault S.A., Renault V.I. S.A., and Mack Trucks, Inc.; 
Proposed Final Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. Sections 16(b) through (h), that a Complaint, 
Hold Separate Stipulation and Order, proposed Final Judgment, and 
Competitive Impact Statement were filed with the United States District 
Court for the District of Columbia in United States of America v. 
Aktiebolaget Volvo, Volvo Trucks North America, Inc., Renault S.A., 
Renault V.I. S.A. and Mack Trucks, Inc., Civil No. 1:00CV03006. On 
December 18, 2000, the United States filed a Complaint in the United 
States District Court for the District of Columbia alleging the 
proposed acquisition by Aktiebolaget Volvo of Renault V.I. S.A., which 
includes Mack Trucks, Inc., from Renault S.A. would violate Section 7 
of the Clayton Act, 15 U.S.C. 18. The proposed Final Judgment, filed at 
the same time as the Complaint, requires Aktiebolaget Volvo, among 
other things, to divest the Volvo Trucks North America, Inc., Low Cab 
Over Engine Truck Business along with certain other tangible and 
intangible assets. Copies of the Complaint, Hold Separate Stipulation 
and Order, proposed Final Judgment, and Competitive Impact Statement 
are available for inspection in Room 200 of the U.S. Department of 
Justice, Antitrust Division, 325 Seventh Street, NW., Washington, DC., 
and at the office of the Clerk of the United States District Court for 
the District of Columbia, Washington, DC.
    Public comment is invited within the statutory 60-day comment 
period. Such comments and response thereto, will be published in the 
Federal Register and filed with the Court. Comments should be directed 
to J. Robert Kramer II, Chief, Litigation II Section, Antitrust 
Division, United States Department of Justice, 1401 H Street, NW., 
Suite 3000, Washington, DC 20530 (Telephone: 202-307-0924).

Constance K. Robinson,
Director of Operations.

Hold Separate Stipulation and Order

    It is hereby stipulated and agreed by and between the undersigned 
parties, subject to approval and entry by the Court, that:

I. Definitions

    As used in this Hold Separate Stipulation and Order:
    A. ``Purchaser'' means the entity to whom defendants divest either 
the VTNA LCOE Truck Business or the Mack LCOE Truck Business.
    B. ``AB Volvo'' means defendant Aktiebolaget Volvo, a Swedish 
corporation with its headquarters in Gotenborg, Sweden, and includes 
its successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, partnerships, and joint ventures, and their directors, 
officers, managers, agents, and employees.
    C. ``VTNA'' means defendant Volvo Trucks North America, Inc., a 
Delaware corporation and a wholly owned subsidiary of AB Volvo with its 
headquarters in Greensboro, North Carolina, and includes its successors 
and assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    D. ``Renault'' means defendant Renault S.A., a French corporation 
with its headquarters in Boulogne-Billancourt, France, and includes its 
successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, partnerships, and joint ventures, and their directors, 
officers, managers, agents, and employees.
    E. ``Renault V.I.'' means defendant Renault V.I.S.A., a French 
corporation and a wholly owned subsidiary of Renault with its 
headquarters in Lyon, France, and includes its successors and assigns, 
and its subsidiaries, divisions, groups, affiliates, partnerships, and 
joint ventures, and their directors, officers, managers, agents, and 
employees.
    F. ``Mack'' means defendant Mack Trucks, Inc., a Pennsylvania 
corporation and a wholly owned subsidiary of Renault V.I. with its 
headquarters in Allentown, Pennsylvania, and includes its successors 
and assigns, and its subsidiaries, division, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    G. ``LCOE Truck'' means a class 8 low cab over entire straight 
truck with a cab

[[Page 11318]]

placed over or in front of the engine and the capability to accept an 
attached vocational body.
    H. ``VTNA LCOE Truck Business'' means VTNA's line of LCOE Trucks 
(which consists of the WX and WXLL) including:
    (1) All tangible assets that comprise the VTNA LCOE Truck Business, 
including research and development activities, all manufacturing 
equipment, tooling and fixed assets, personal property, inventory, 
materials, supplies, and other tangible property and all other assets 
used exclusively in connection with the VTNA LCOE Truck Business; all 
components, parts, and designs used in LCOE Trucks comprising the VTNA 
LCOE Truck Business; all licenses, permits and authorizations issued by 
any governmental organization relating to the VTNA LCOE Truck Business; 
all contracts, teaming arrangements, agreements, leases, commitments, 
certifications, and understandings relating to the VTNA LCOE Truck 
Business, including supply agreements; all lists, contracts, accounts, 
and credit record of customers; all repair, performance, and VTNA LCOE 
Truck Business records and all other records relating to the VTNA LCOE 
Truck Business. The VTNA Truck Business does not include the sale of 
the VTNA New River Valley, Virginia, plant; and
    (2) any and all intangible assets used in the development, 
production, servicing and sale of the VTNA LCOE Truck Business, 
including, but not limited to: (a) the Xpeditor, WX, and WXLL brand 
names and all other intellectual property rights used exclusively in 
connection with the VTNA LCOE Truck Business; (b) with respect to all 
other intellectual property rights used in connection with both the 
VTNA LCOE Truck Business and other nondivested AB Volvo assets (other 
than intellectual property regarding use of the word ``Volvo''), a 
transferable, license, exclusive in the VTNA LCOE Truck Business field 
of use; (c) all existing licenses and sublicenses relating exclusively 
to the VTNA LCOE Truck Business; (d) a transferable, sublicense, 
exclusive in the VTNA LCOE Truck Business field of use, to all other 
existing licenses and sublicenses relating to the VTNA LCOE Truck 
Business; and (e) all research, market evaluations or information 
relating to plans for improvements or updates to, or product line 
extensions of the WX or WXLL. Intellectual property rights comprise, 
but are not limited to, patents, licenses and sublicenses, copyrights, 
technical information, trademarks, trade names, service marks, service 
names, computer software and related documentation, know-how, trade 
secrets, drawings, blueprints, designs, design protocols, 
specifications for parts and devices, safety procedures for the 
handling of materials and substances, quality assurance and control 
procedures, design tools and simulation capability, all manuals and 
technical information provided to employees, customers, suppliers, 
agents, or licensees, and all research data concerning historic and 
current research and development efforts relating to the VTNA LCOE 
Truck Business including, but not limited to, designs of experiments 
and the results of successful and unsuccessful designs and experiments.
    I. ``Mack LCOE Truck Business'' means Mack's line of LCOE Trucks 
(which includes the MR and LE) including:
    (1) All tangible assets that comprise the Mack LCOE Truck Business, 
including research and development activities, all manufacturing 
equipment, tooling and fixed assets, personal property, inventory, 
materials, supplies, and other tangible property and all other assets 
used exclusively in connection with the Mack LCOE Truck Business; all 
components, parts, and designs used in LCOE Trucks comprising the Mack 
LCOE Truck Business; all licenses, permits and authorizations issued by 
any governmental organization relating to the Mack LCOE Truck Business; 
all contracts, teaming arrangements, agreements, leases, commitments, 
certifications, and understandings relating to the Mack LCOE Truck 
Business, including supply agreements; all lists, contracts, accounts, 
and credit records of customers; all repair, performance, and Mack LCOE 
Truck Business records and all other records relating to the Mack LCOE 
Truck Business. The Mack LCOE Truck Business does not include the sale 
of the Mack Macungie, Pennsylvania, plant; and
    (2) any and all intangible assets used in the development, 
production, servicing and sale of the Mack LCOE Truck Business, 
including, but not limited to: (a) The MR and LE brand names and all 
other intellectual property rights used exclusively in connection with 
the Mack LCOE Truck Business; (b) with respect to all other 
intellectual property rights used in connection with both the Mack LCOE 
Truck Business and other nondivested Renault assets (other than 
intellectual property regarding use of the word ``Mack'' or the word 
``Renault''), a transferable, license, exclusive in the Mack LCOE Truck 
Business field of use; (c) all existing licenses and sublicenses 
relating exclusively to the Mack LCOE Truck Business; (d) a 
transferable, sublicense, exclusive in the Mack LCOE Truck Business 
field of use, to all other existing licenses and sublicenses relating 
to the Mack LCOE Truck Business; and (e) all research, market 
evaluations or information relating to plans for, improvements or 
updates to, or product line extensions of the MR or LE. Intellectual 
property rights comprise, but are not limited to patents, licenses and 
sublicenses, technical information, copyrights, trademarks, trade 
names, service marks, service names, computer software and related 
documentation, know-how, trade secrets, drawings, blueprints, designs, 
design protocols, specifications for parts and devices, safety 
procedures for the handling of materials and substances, quality 
assurance and control procedures, design tools and simulation 
capability, all manuals and technical information provided to 
employees, customers, suppliers, agents, or licensees, and all research 
data concerning historic and current research and development efforts 
relating to the Mack LCOE Truck Business including, but not limited to, 
designs of experiments and the results of successful and unsuccessful 
designs and experiments.

II. Objectives

    The Final Judgment filed in this case is meant to ensure 
defendants' prompt divestiture of the VTNA LCOE Truck Business or, 
pursuant to the decision of a trustee, the Mack LCOE Truck Business, 
for the purpose of assuring the establishment of one or more viable 
competitors in the LCOE Truck industry capable of competing effectively 
to supply LCOE Trucks in North America and to remedy the 
anticompetitive effects that the United States alleges would otherwise 
result from AB Volvo's acquisition of Renault V.I. This Hold Separate 
Stipulation and Order ensures, prior to such divestitures, that the 
VTNA and Mack LCOE Truck Businesses operate as competitively 
independent, economically viable, and ongoing business concerns that 
will remain independent and uninfluenced by the consummation of AB 
Volvo's acquisition of Renault V.I., and that competition is maintained 
during the pendency of the ordered divestitures.

III. Jurisdiction and Venue

    The Court has jurisdiction over the subject matter of this action 
and over each of the parties hereto, and venue of this action is proper 
in the Untied States District Court for the District of Columbia.

[[Page 11319]]

IV. Compliance With and Entry of Final Judgment

    A. The parties stipulate that a Final Judgment in the form attached 
hereto as Exhibit A may be filed with an entered by the Court, upon the 
motion of any party or upon the Court's own motion, at any time after 
compliance with the requirements of the Antitrust Procedures and 
Penalties Act (15 U.S.C. 16), and without further notice to any party 
or other proceedings, provided that the United States has not withdrawn 
its consent, which it may do at any time before the entry of the 
proposed Final Judgment by serving notice thereof on defendants and by 
filing that notice with the Court.
    B. Defendants shall abide by and comply with the provisions of the 
proposed Final Judgment, pending the Judgment's entry by the Court, or 
until expiration of time for all appeals of any Court ruling declining 
entry of the proposed Final Judgment, and shall, from the date of the 
signing of this Stipulation by the parties, comply with all the terms 
and provisions of the proposed Final Judgment as though the same were 
in full force and effect as an order of the Court.
    C. Defendants shall not consummate the transaction sought to be 
enjoined by the Complaint herein before the Court has singed this Hold 
Separate Stipulation and Order.
    D. This Stipulation shall apply with equal force and effect to any 
amended proposed Final Judgment agreed upon in writing by the parties 
and submitted to the Court.
    E. In the event (1) the United States has withdrawn its consent, as 
provided in Section IV(A) above, or (2) the proposed Final Judgment is 
not entered pursuant to this Stipulation, the time has expired for all 
appeals of any Court ruling declining entry of the proposed Final 
Judgment, and the Court has not otherwise ordered continued compliance 
with the terms and provisions of the proposed Final Judgment, then the 
parties are released from all further obligations under this 
Stipulation, and the making of this Stipulation shall be without 
prejudice to any party in this or any other proceeding.
    F. Defendants represent that the divestiture ordered in the 
proposed Final Judgment can and will be made, and that defendants will 
later raise no claim of mistake, hardship or difficulty of compliance 
as grounds for asking the Court to modify any of the provisions 
contained therein.

V. Hold Separate Provisions

    Until the divestitures required by the Final Judgment have been 
accomplished:
    A. Defendants shall preserve, maintain, and continue to operate the 
VTNA and Mack LCOE Truck Businesses as competitively independent, 
economically viable parts of ongoing competitive businesses, with 
management, research, design, development, promotions, marketing, sales 
and operations of such assets held entirely separate, distinct and 
apart from those of the defendants' other operations. Except as 
provided in this paragraph, AB Volvo shall not coordinate the research 
and development, promotions, production, marketing or terms of sale of 
any products produced by or sold by or through the VTNA LCOE Truck 
Business with those produced or sold by or through the Mack LCOE Truck 
Business. Notwithstanding the foregoing provisions, AB Volvo is not 
prohibited from continuing the historical, regular course of business, 
system-wide production and sales of VTNA and Mack LCOE Trucks, provided 
that defendants continue to support and maintain the VTNA and Mack LCOE 
Truck Businesses as independent, ongoing, economically viable and 
active competitors in the LCOE Truck industry as required by this Hold 
Separate Stipulation and Order (including efforts to maintain and 
increase the sales revenue of the VTNA and Mack LCOE Truck Businesses 
required under Section V.(C)). Within twenty (20) days after the entry 
of this Hold Separate Stipulation and Order, defendants will inform the 
United States of the steps defendants have taken to comply with this 
Hold Separate Stipulation and Order.
    B. Defendants shall take all steps necessary to ensure that (1) the 
VTNA and Mack LCOE Truck Businesses will be maintained and operated as 
an independent, ongoing, economically viable and active competitors in 
the LCOE Truck industry; (2) management of the VTNA and Mack LCOE Truck 
Businesses (designated in Section V.(J)) will not be influenced by 
defendants; and (3) the books, records, competitively sensitive sales, 
marketing and pricing information, and decision-making concerning 
research, development, marketing, production, distribution or sales of 
products by or under any of the VTNA and Mack LCOE Truck Businesses 
will be kept separate and apart from defendants' other operations.
    C. Defendants shall use all reasonable efforts to maintain and 
increase the research, development, sales, and revenues of the products 
produced by or sold under the VTNA and Mack LCOE Truck Businesses, and 
shall maintain at 2000 levels or previously approved levels for 2001, 
whichever are higher, all research, development, product improvement, 
promotional, advertising, sales, technical assistance, marketing and 
merchandising support for the VTNA and Mack LCOE Truck Businesses.
    D. Defendants shall provide sufficient working capital and lines 
and sources of credit to continue to maintain the VTNA and Mack LCOE 
Businesses as economically viable and competitive, ongoing businesses, 
consistent with the requirements of Sections V(A) and V(B).
    E. Defendants shall take all steps necessary to ensure that all the 
assets of the VTNA and Mack LCOE Truck Businesses are fully maintained 
in operable condition at no less than current capacity and sales, and 
shall maintain and adhere to normal product improvement and upgrade and 
repair and maintenance schedules for those assets.
    F. Defendants shall not, except as part of a divestiture approved 
by the United States in accordance with the terms of the proposed Final 
Judgment, remove, sell, lease, assign, transfer, pledge or otherwise 
dispose of any of the VTNA and Mack LCOE Truck Businesses.
    G. Defendants shall maintain, in accordance with sound accounting 
principles, separate, accurate and complete financial ledgers, books 
and records that report on a periodic basis, such as the last business 
day of every month, consistent with past practices, the assets, 
liabilities, expenses, revenues and income of the VTNA and Mack LCOE 
Truck Businesses.
    H. Defendants shall take no action that would jeopardize, delay, or 
impede the sale of the VTNA and Mack LCOE Truck Businesses.
    I. Defendants' employees with primary responsibility for the 
research, design, development, promotion, distribution, sale, and 
operation of the VTNA and Mack LCOE Truck Businesses shall not be 
transferred or reassigned to other areas within the company except for 
transfer bids initiated by employees pursuant to defendants' regular, 
established job posting policy. Defendants shall provide the United 
States with ten (10) calendar days notice of such transfer.
    J. Prior to consummation of their transaction, defendants shall 
appoint Stanley C. Ellspermann to oversee the VTNA LCOE Truck Business 
and Denis

[[Page 11320]]

Leblond to oversee the Mack LCOE Truck Business, and to be responsible 
for defendants' compliance with this section. Stanley C. Ellspermann 
shall have complete managerial responsibility for the VTNA LCOE Truck 
Business, and Denis Leblond shall have complete managerial 
responsibility for the Mack LCOE Truck Business, subject to the 
provisions of this Final Judgment. In the event either person is unable 
to perform his duties, defendants shall appoint, subject to the 
approval of the United States, a replacement within ten (10) working 
days. Should defendants fail to appoint a replacement acceptable to the 
United States within this time period, the United States shall appoint 
a replacement.
    K. Defendants shall take no action that would interfere with the 
ability of any trustee appointed pursuant to the Final Judgment to 
monitor and complete the divestiture pursuant to the Final Judgment to 
a purchaser acceptable to the United States.
    L. This Hold Separate Stipulation and Order shall remain in effect 
until consummation of the divestiture required by the proposed Final 
Judgment or until further order of the Court.
    Dated: December 18, 2000.

For Plaintiff, United States of America:
Frederick H. Parmenter,
Virginia Bar No.: 18184, United States Department of Justice, 
Antitrust Division, Litigation II Section, 1401 H Street, NW., Suite 
3000, Washington, DC 20530, (202) 307-0620.

Respectfully submitted,
For Defendants Aktiebolaget Volvo and Volvo Trucks North America, 
Inc.:
Kevin Arquit,
Clifford Chance Rogers & Wells LLP, 200 Park Avenue, New York, New 
York 10166-0153, (202) 878-8375.

For Defendants Renault S.A., Renault S.A. V.I. and Mack Trucks, 
Inc.:
Richard J. Urowsky,
Sullivan & Cromwell, 125 Broad Street, New York, New York 10004, 
(202) 558-4812.

Order

    It Is So Ordered by the Court, this ______ day of December, 2000.

----------------------------------------------------------------------
United States District Judge

Final Judgment

    Whereas, plaintiff, the United States of America (``United 
States''), filed its Complaint on December 18, 2000, and defendants 
Aktiebolaget Volvo (``AB Volvo''), Volvo Trucks North America, Inc. 
(``VTNA''), Renault S.A. (``Renault''), Renault V.I.S.A. (``Renault 
V.I.''), and Mack trucks, Inc. (``Mack''), by their respective 
attorneys, having consented to the entry of this Final Judgment without 
trial or adjudication of any issue of fact or law herein, and without 
this Final Judgment constituting any evidence against or any admission 
by any party with respect to any issue of law or fact herein;
    And whereas, defendants have agreed to be bound by the provisions 
of this Final Judgment pending its approval by the court;
    And whereas, the essence of this Final Judgment is the prompt and 
certain divestiture of the business and assets identified below to 
assure that competition is not substantially lessened;
    And whereas, the United States requires defendants to make the 
divestitures ordered herein for the purpose of remedying the loss of 
competition alleged in the Complaint;
    And whereas, defendants have represented to the United States that 
the divestitures ordered herein can and will be made promptly and that 
defendants later will raise no claim of hardship or difficulty as 
grounds for asking the Court to modify any of the divestiture 
provisions contained below;
    Now, therefore, before taking any testimony, and without trial or 
adjudication of any issue of fact or law herein, and upon consent of 
the parties hereto, it is hereby Ordered, Adjudged, and Decreed as 
follows:

I. Jurisdiction

    This Court has jurisdiction over each of the parties hereto and 
over the subject matter of this action. The Complaint states a claim 
upon which relief may be granted against defendants under Section 7 of 
the Clayton Act, as amended (15 U.S.C. 18).

II. Definitions

    As used in this Final Judgment:
    A. ``AB Volvo'' means defendant Aktiebolaget Volvo, a Swedish 
corporation with its headquarters in Gotenborg, Sweden, and includes 
its successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, partnerships, and joint ventures, and their directors, 
officers, managers, agents, and employees.
    B. ``VTNA'' means defendant Volvo Trucks North America, Inc., a 
Delaware corporation and a wholly owned subsidiary of AB Volvo with its 
headquarters in Greensboro, North Carolina, and includes its successors 
and assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    C. ``Renault'' means defendant Renault S.A., a French corporation 
with its headquarters in Boulogne-Billancourt, France, and includes its 
successors and assigns, and its subsidiaries, divisions, groups, 
affiliates, partnerships, and joint ventures, and their directors, 
officers, managers, agents, and employees.
    D. ``Renault V.I.'' means defendant Renault V.I. S.A., a French 
corporation and a wholly owned subsidiary of Renault with its 
headquarters in Lyon, France, and includes its successors and assigns, 
and its subsidiaries, divisions, groups, affiliates, partnerships, and 
joint ventures, and their directors, officers, managers, agents, and 
employees.
    E. ``Mack'' means defendant Mack Trucks, Inc., a Pennsylvania 
corporation and a wholly owned subsidiary of Renault V.I. with its 
headquarters in Allentown, Pennsylvania, and includes its successors 
and assigns, and its subsidiaries, divisions, groups, affiliates, 
partnerships, and joint ventures, and their directors, officers, 
managers, agents, and employees.
    F. ``LCOE Truck'' means a class 8 low cab over engine straight 
truck with a cab placed over or in front of the engine and the 
capability to accept an attached vocational body.
    G. ``VTNA LCOE Truck Business'' means VTNA's line of LCOE Trucks 
(which consists of the WX and WXLL) including:
    (1) All tangible assets that comprise the VTNA LCOE Truck Business, 
including research and development activities, all manufacturing 
equipment, tooling and fixed assets, personal property, inventory, 
materials, supplies, and other tangible property and all other assets 
used exclusively in connection with the VTNA LCOE Truck Business; all 
components, parts, and designs used in LCOE Trucks comprising the VTNA 
LCOE Truck Business; all licenses, permits and authorizations issued by 
any governmental organization relating to the VTNA LCOE Truck Business; 
all contracts, teaming arrangements, agreements, leases, commitments, 
certifications, and understandings relating to the VTNA LCOE Truck 
Business, including supply agreements; all lists, contracts, accounts, 
and credit records of customers; all repair, performance, and VTNA LCOE 
Truck Business records and all other records relating to the VTNA LCOE 
Truck Business. The VTNA Truck Business does not include the sale of 
the VTNA New River Valley, Virginia, plant; and
    (2) any and all intangible assets used in the development, 
production, servicing and sale of the VTNA LCOE Truck Business, 
including, but not limited to: (a) The Xpeditor, WX, and WXLL brand 
names and all other

[[Page 11321]]

intellectual property rights used exclusively in connection with the 
VTNA LCOE Truck Business; (b) with respect to all other intellectual 
property rights used in connection with both the VTNA LCOE Truck 
Business and other nondivested AB Volvo assets (other than intellectual 
property regarding use of the word ``Volvo''), a transferable license, 
exclusive in the VTNA LCOE Truck Business field of use; (c) all 
existing licenses and sublicenses relating exclusively to the VTNA LCOE 
Truck Business; (d) a transferable sublicense, exclusive in the VTNA 
LCOE Truck Business field of use, to all other existing licenses and 
sublicenses relating to the VTNA LCOE Truck Business; and (e) all 
research, market evaluations or information relating to plans for, 
improvements or updates to, or product line extensions of the WX or 
WXLL. Intellectual property rights comprise, but are not limited to, 
patents, licenses and sublicenses, technical information, copyrights, 
trademarks, trade names, service marks, service names, computer 
software and related documentation, know-how, trade secrets, drawings, 
blueprints, designs, design protocols, specifications for parts and 
devices, safety procedures for the handling of materials and 
substances, quality assurance and control procedures, design tools and 
simulation capability, all manuals and technical information provided 
to employees, customers, suppliers, agents, or licensees, and all 
research data concerning historic and current research and development 
efforts relating to the VTNA LCOE Truck Business including, but not 
limited to, designs of experiments and the results of successful and 
unsuccessful designs and experiments.
    H. ``Mack LCOE Truck Business'' means Mack's line of LCOE Trucks 
(which includes the MR and LE) including:
    (1) All tangible assets that comprise the Mack LCOE Truck Business, 
including research and development activities, all manufacturing 
equipment, tooling and fixed assets, personal property, inventory, 
materials, supplies, and other tangible property and all other assets 
used exclusively in connection with the Mack LCOE Truck Business; all 
components, parts, and designs used in LCOE Trucks comprising the Mack 
LCOE Truck Business; all licenses, permits and authorizations issued by 
any governmental organization relating to the Mack LCOE Truck Business; 
all contracts, teaming arrangements, agreements, leases, commitments, 
certifications, and understandings relating to the Mack LCOE Truck 
Business, including supply agreements; all lists, contracts, accounts, 
and credit records of customers; all repair, performance, and Mack LCOE 
Truck Business records and all other records relating to the Mack LCOE 
Truck Business. The Mack LCOE Truck Business does not include the sale 
of the Mack Macungie, Pennsylvania, plant; and
    (2) any and all intangible assets used in the development, 
production, servicing and sale of the Mack LCOE Truck Business, 
including, but not limited to: (a) The MR and LE brand names and all 
other intellectual property rights used exclusively in connection with 
the Mack LCOE Truck Business; (b) with respect to all other 
intellectual property rights used in connection with both the Mack LCOE 
Truck Business and other nondivested Renault assets (other than 
intellectual property regarding use of the word ``Mack'' or the word 
``Renault''), a transferable license, exclusive in the Mack LCOE Truck 
Business field of use; (c) all existing licenses and sublicenses 
relating exclusively to the Mack LCOE Truck Business; (d) a 
transferable sublicense, exclusive in the Mack LCOE Truck Business 
field of use, to all other existing licenses and sublicenses relating 
to the Mack LCOE Truck Business; and (e) all research, market 
evaluations or information relating to plans for, improvements or 
updates to, or product line extensions of the MR or LE. Intellectual 
property rights comprise, but are not limited to, patents, licenses and 
sublicenses, technical information, copyrights, trademarks, trade 
names, service marks, service names, computer software and related 
documentation, know-how, trade secrets, drawings, blueprints, designs, 
design protocols, specifications for parts and devices, safety 
procedures for the handling of materials and substances, quality 
assurance and control procedures, design tools and simulation 
capability, all manuals and technical information provided to 
employees, customers, suppliers, agents, or licensees, and all research 
data concerning historic and current research and development efforts 
relating to the Mack LCOE Truck Business including, but not limited to, 
designs of experiments and the results of successful and unsuccessful 
designs and experiments.

III. Applicability

    A. This Final Judgment applies to AB Volvo, VTNA, Renault, Renault 
V.I., and Mack, as defined above, and all other persons in active 
concert or participation with any of them who receive actual notice of 
this Final Judgment by personal service or otherwise.
    B. Defendents shall require, as a condition of the sale or other 
disposition of all or substantially all of their assets, or of lesser 
business units that include the VTNA LCOE Truck Business, that the 
purchaser agrees to be bound by the provisions of this Final Judgment, 
provided, however, that defendants need not obtain such an agreement 
from the purchaser of the VTNA LCOE Truck Business or Mack LCOE Truck 
Business pursuant to this Final Judgment.

IV. Divestitures

    A. Defendants are ordered and directed, within ninety (90) calendar 
days after the filing of the Complaint in this matter, or five (5) days 
after notice of the entry of this Final Judgment by this Court, 
whichever is later, to
    (1) Divest the VTNA LCOE Truck Business in a manner consistent with 
this Final Judgment as a viable ongoing business to a purchaser 
acceptable to the United States in its sole discretion;
    (2) enter into an agreement with the purchaser of the VTNA LCOE 
Truck Business whereby defendants guarantee that the VTNA LCOE Truck 
Business will be able to use engines which meet United States 
Environmental Protection Agency 2002 emissions requirements; and
    (3) at the option of the purchaser of the VTNA LCOE Truck Business, 
enter into an agreement to supply reasonable levels of transitional and 
manufacturing start-up support for a maximum period of 2 years that 
will enable the purchaser or purchasers to produce VTNA LCOE Trucks.
    B. Defendants agree to use their best efforts to divest the VTNA 
LCOE Truck Business as expeditiously as possible. The United States, in 
its sole discretion, may extend the time period for the divestiture two 
additional periods of time, not to exceed thirty (30) calendar days 
each, and shall notify this Court in such circumstances.
    C. In accomplishing the divestiture ordered by this Final Judgment, 
defendants promptly shall make known, by usual and customary means, the 
availability of the VTNA LCOE Truck Business. Defendants shall inform 
any person making inquiry regarding a possible purchase of the VTNA 
LCOE Truck Business that it is being divested pursuant to this Final 
Judgment and provide that person with a copy of this Final Judgment. 
Defendants shall offer to furnish to all prospective purchasers, 
subject to customary assurances, all information and documents relating 
to

[[Page 11322]]

the VTNA LCOE Truck Business customarily provided in a due diligence 
process, except such information or documents subject to the attorney-
client or attorney work-product privileges. Defendants shall make 
available such information to the United States at the same time that 
such information is made available to any other person.
    D. Defendants shall provide the purchaser and the United States 
information relating to any AB Volvo or VTNA personnel involved in the 
research, design, production, operation, development, marketing and 
sale of the VTNA LCOE Truck Business to enable the purchaser to make 
offers of employment. Defendants will not interfere with any 
negotiations by the purchaser to employ any person whose primary 
responsibility is the research, design, production, operation, 
development, marketing or sale of the VTNA LCOE Truck Business.
    E. Defendants shall permit prospective purchasers of the VTNA LCOE 
Truck Business to have reasonable access to personnel and to make 
inspections of the physical facilities of the VTNA business to be 
divested; access to any and all environmental, zoning, and other permit 
documents and information; and access to any and all financial, sales, 
marketing, operational, or other documents and information customarily 
provided as part of a due diligence process.
    F. Defendants shall warrant to the purchaser of the VTNA LCOE Truck 
Business that each asset of the VTNA LCOE Truck Business will be 
operational on the date of sale.
    G. Defendants shall not take any action that will impede in any way 
the permitting, operation, or divestiture of the VTNA LCOE Truck 
Business.
    H. Defendants shall not take any action that will in any impede or 
exclude their dealers from distributing, selling, or servicing LCOE 
Trucks produced by the purchaser of the VTNA LCOE Truck Business.
    I. Defendants shall warrant to the purchaser of the VTNA LCOE Truck 
Business that there are no material defects in the environment, zoning, 
or other permits pertaining to the operation of each asset, and that 
following the sale of the VTNA LCOE Business, defendants will not 
undertake, directly or indirectly, any challenges to the environmental, 
zoning, or other permits relating to the operation of the VTNA LCOE 
Truck Business.
    J. Unless the United States consents in writing, the divestiture 
pursuant to Section IV of this Final Judgment, whether by defendants or 
by a trustee appointed pursuant to Section VI of this Final Judgment, 
shall include the entire VTNA LCOE Truck Business as defined in Section 
II. The divestiture of the VTNA LCOE Truck Business shall be 
accomplished by selling or otherwise conveying the VTNA LCOE Truck 
Business to a purchaser in such a way as to satisfy the United States, 
in its sole discretion, that business to be divested can and will be 
used by the purchaser as part of a viable, ongoing LCOE Truck business. 
The divestiture of the VTNA LCOE Truck Business, whether pursuant to 
Section IV or Section VI of this Final Judgment, shall be made to a 
purchaser in a manner so as to satisfy the United States, in its sole 
discretion, that it: (1) Has the capability and intent of competing 
effectively in the development, production and sale of LCOE Trucks; (2) 
has the managerial, operational, technical and financial capability to 
compete effectively in the development, production and sale of LCOE 
Trucks; and (3) is not hindered by the terms of any agreement between 
the purchaser and defendants that gives either defendant the ability 
unreasonably to raise the purchaser's costs, to lower the purchaser's 
efficiency, or otherwise to interfere with the ability of the purchaser 
to compete effectively.

V. Notice of Proposed Divestitures

    Within two (2) business days following execution of a definitive 
agreement, contingent upon compliance with the terms of this Final 
Judgment, to effect, in whole or in part, any proposed divestiture 
pursuant to Sections IV or VI of this Final Judgment, defendants or the 
trustee, whichever is then responsible for effecting the divestiture, 
shall notify the United States of the proposed divestiture. If the 
trustee is responsible, it shall similarly notify defendants. The 
notice shall set forth the details of the proposed divestiture and list 
the name, address, and telephone number of each person not previously 
identified who offered to, or expressed an interest in or a desire to, 
acquire any ownership interest in the VTNA LCOE Business, together with 
full details of same. Within fifteen (15) calendar days of receipt by 
the United States of such divestiture notice, the United States may 
request from defendants, the proposed purchaser, any other third party, 
or the trustee if applicable, additional information concerning the 
proposed divestiture, the proposed purchaser, and any other potential 
purchaser. Defendants and the trustee shall furnish any additional 
information requested from them within fifteen (15) calendar days of 
the receipt of the request, unless the parties shall otherwise agree. 
Within thirty (30) calendar days after receipt of the notice, or within 
twenty (20) calendar days after the United States has been provided the 
additional information requested from the defendants, the proposed 
purchaser, any third party, or the trustee, whichever is later, the 
United States shall each provide written notice to defendants and the 
trustee, if there is one, stating whether or not it objects to the 
proposed divestiture. If the United States provides written notice to 
defendants (and the trustee if applicable) that it does not object, 
then the divestiture may be consummated, subject only to defendants' 
limited right to object to the sale under Section VI(B) of this Final 
Judgment. Absent written notice that the United States does not object 
to the proposed purchaser or upon objection by the United States, a 
divestiture proposed under Section IV or Section VI may not be 
consummated. Upon objection by defendants under the provision in 
Section VI(C), a divestiture proposed under Section VI shall not be 
consummated unless approved by the Court.

VI. Appointment of Trustee

    A. If defendants have not divested the VTNA LCOE Truck Business 
within the time period specified in Section IV(A), defendants shall 
notify the United States of that fact in writing. Upon application of 
the United States, the Court shall appoint a trustee selected by the 
United States and approved by the Court to effect the divestiture of 
the VTNA or Mack LCOE Truck Business. The trustee shall have the right, 
in its sole discretion, to sell either the VTNA LCOE Truck Business or 
the Mack LCOE Truck Business. The trustee shall also have the right, in 
its sole discretion, and upon notice to the defendants and upon 
consultation with the United States, to add such other assets and 
agreements concerning necessary parts and components, in order to 
ensure the viability, competitiveness, and marketability of the Mack 
LCOE Truck Business.
    B. After the appointment of a trustee becomes effective, only the 
trustee shall have the right to sell the VTNA or Mack LCOE Truck 
Business. The trustee shall have the power and authority to accomplish 
the divestiture at the earliest possible time to a purchaser acceptable 
to the United States at such price and on such terms as are then 
obtainable for the VTNA or Mack LCOE Truck Business, upon a reasonable 
effort by the trustee, subject to the provisions of Sections IV, V, and 
VI of this Final

[[Page 11323]]

Judgment, and shall have such other powers as the Court shall deem 
appropriate. Subject to Section VI(D) of this Final Judgment, the 
trustee may hire at the cost and expense of the defendants, any 
investment bankers, attorneys, or other agents, who shall be solely 
accountable to the trustee, reasonably necessary in the trustee's 
judgment to assist in the divestiture.
    C. Defendants shall not object to a sale by the trustee on any 
ground other than the trustee's malfeasance. Any such objections by 
defendants must be conveyed in writing to the United States and the 
trustee within ten (10) calendar days after the trustee has provided 
the notice required under Section V of this Final Judgment.
    D. The trustee shall serve at the cost and expense of defendants, 
on such terms and conditions as approved by the United States. The 
trustee shall account for all monies derived from the sale of the VTNA 
or Mack LCOE Truck Business, and all costs and expenses so incurred. 
After approval by the Court of the trustee's accounting, including fees 
for its services and those of any professionals and agents retained by 
the trustee, all remaining money shall be paid to defendants and the 
trust shall then be terminated. The compensation of the trustee and of 
any professionals and agents retained by the trustee shall be 
reasonable in light of the value of the VTNA or Mack LCOE Truck 
Business and based on a fee arrangement providing the trustee with an 
incentive based on the price and terms of the divestiture and the speed 
with which it is accomplished, but timeliness is paramount.
    E. Defendants shall use their best efforts to assist the trustee in 
accomplishing the required divestiture pursuant to this Section. The 
trustee and any consultants, accountants, attorneys, and other persons 
retained by the trustee shall have full and complete access to the 
personnel, books, records, and facilities of the VTNA and Mack LCOE 
Truck Business, and defendants shall develop financial or other 
information relevant to such businesses as the trustee may reasonably 
request, subject to reasonable protection for trade secrets or other 
confidential research, development or commercial information. 
Defendants shall take no action to interfere with or to impede the 
trustee's accomplishment of the divestiture.
    F. After its appointment, the trustee shall file monthly reports 
with the United States and the Court setting forth the trustee's 
efforts to accomplish the divestiture ordered under this Final 
Judgment. To the extent such reports contain information that the 
trustee deems confidential, such reports shall not be filed in the 
public docket of the Court. Such reports shall include the name, 
address and telephone number of each person who, during the preceding 
month, made an offer to acquire, expressed an interest in acquiring, 
entered into negotiations to acquire, or was contacted or made an 
inquiry abut acquiring, any interest in the VTNA or Mack LCOE Truck 
Business, and shall describe in detail each contact with any such 
person. The trustee shall maintain full records of all efforts made to 
divest the VTNA or Mack LCOE Truck Business.
    G. If the trustee has not accomplished the divestiture of the VTNA 
or Mack LCOE Truck Business within six (6) months after its 
appointment, the trustee thereupon shall file promptly with the Court a 
report setting forth (1) the trustee's efforts to accomplish the 
required divestiture, (2) the reasons, in the trustee's judgment, why 
the required divestiture has not been accomplished, and (3) the 
trustee's recommendations. To the extent such reports contain 
information that the trustee deems confidential, such reports shall not 
be filed in the public docket of the Court. The trustee shall at the 
same time furnish such report to the United States, who shall have the 
right to make additional recommendations consistent with the purpose of 
the trust. The Court shall enter thereafter such orders as it shall 
deem appropriate in order to carry out the purpose of this Final 
Judgment which may, if necessary, include extending the trust and the 
term of the trustee's appointment by a period requested by the United 
States.

VII. Affidavits

    A. Within twenty (20) calendar days of the filing of the Complaint 
in this matter and every thirty (30) calendar days thereafter until the 
divestiture has been completed, whether pursuant to Section IV or 
Section VI of this Final Judgment, defendants shall deliver to the 
United States an affidavit as to the fact and manner of their 
compliance with Sections IV or VI of this Final Judgment. Each such 
affidavit shall include, inter alia, the name, address, and telephone 
number of each person who, at any time after the period covered by the 
last such report, made an offer to acquire, expressed an interest in 
acquiring, entered into negotiations to acquire, or was contracted or 
made an inquiry about acquiring, any interest in the VTNA LCOE Truck 
Business, or after appointment of a trustee under Section VI of this 
Final Judgment, the Mack LCOE Truck Business, and shall describe in 
detail each contact with any such person during that period. Each such 
affidavit shall also include a description of the efforts that 
defendants have taken to solicit potential purchasers for the VTNA LCOE 
Truck Business and to provide required information to potential 
purchasers, including the limitations, if any, on such information. 
Assuming the information set forth in the affidavit is true and 
complete, any objection by the United States to information provided by 
defendants, including limitations on information, shall be made within 
fourteen (14) days of receipt of such affidavit.
    B. Within twenty (20) calendar days of the filing of the Complaint 
in this matter, defendants shall deliver to the United States an 
affidavit which describes in reasonable detail all actions defendants 
have taken and all steps defendants have implemented on an ongoing 
basis to comply with Section VIII of this Final Judgment and the Hold 
Separate Stipulation and Order entered by the Court. The affidavit also 
shall describe, but not be limited to, defendants' efforts to maintain 
and operate the VTNA LCOE Truck Business as an active competitor, 
maintain its management, staffing, research and development activities, 
sales, marketing and pricing, and maintain the business in operable 
condition at current capacity configurations. Defendants shall deliver 
to the United States an affidavit describing any changes to the efforts 
and actions outlined in defendants' earlier affidavit(s) filed pursuant 
to this Section within fifteen (15) calendar days after the change is 
implemented.
    C. Until one year after the divestiture has been completed, 
defendants shall preserve all records of all efforts made to preserve 
the business to be divested and to effect the ordered divestiture.

VIII. Hold Separate Order

    Until the divestiture required by this Final Judgment has been 
accomplished, defendants shall take all steps necessary to comply with 
the Hold Separate Stipulation and Order entered by this Court. 
Defendants shall take no action that would jeopardize the divestiture 
ordered by this Court.

IX. Financing

    Defendants are ordered and directed not to finance all or any part 
of any purchase made pursuant to Sections IV or VI of this Final 
Judgment.

[[Page 11324]]

X. No Reacquisition

    Defendants may not reacquire any part of the divested assets during 
the term of this Final Judgment.

XI. Compliance Inspection

    For the purposes of determining or securing compliance with this 
Final Judgment, or of determining whether this Final Judgment should be 
modified or vacated, and subject to any legally recognized privilege, 
from time to time:
    A. Duly authorized representatives of the United States Department 
of Justice, including consultants and other persons retained by the 
United States, upon written request of a duly authorized representative 
of the Assistant Attorney General in charge of the Antitrust Division, 
and on reasonable notice to defendants made to their principal offices, 
shall be permitted:
    1. Access during office hours of defendants to inspect and copy, or 
at plaintiff's option, to require defendants to provide copies of, all 
books, ledgers, accounts, correspondence, memoranda, and other records 
and documents in the custody or possession or under the control of 
defendants relating to any matters contained in this Final Judgment and 
the Hold Separate Stipulation and Order; and
    2. to interview, either informally or on the record, defendants' 
officers, employees, and agents, who may have their individual counsel 
present, regarding any such matters. The interviews shall be subject to 
the reasonable convenience of the interviewee and without restraint or 
interference by defendants.
    B. upon the written request of a duly authorized representative of 
the Assistant Attorney General in charge of the Antitrust Division, 
made to defendants' principal offices, defendants shall submit written 
reports, under oath if requested, relating to any matter contained in 
this Final Judgment or the Hold Separate Stipulation and Order as may 
be requested.
    C. no information or documents obtained by the means provided in 
this Section shall be divulged by the United States to any person other 
than an authorized representative of the executive branch of the United 
States, except in the course of legal proceedings to which the United 
States is a party (including grand jury proceedings), or for the 
purpose of securing compliance with this Final Judgment, or as 
otherwise required by law.
    D. if at the time information or documents are furnished by 
defendants to the United States, defendants represent and identify in 
writing the material in any such information or documents to which a 
claim of protection may be asserted under Rule 26(c)(7) of the Federal 
Rules of Civil Procedure, and defendants mark each pertinent page of 
such material, ``Subject to claim of protection under Rule 26(c)(7) of 
the Federal Rules of Civil Procedure,'' then ten (10) calendar days 
notice shall be given to defendants by the United States prior to 
divulging such material in any legal proceeding (other than a grand 
jury proceeding) to which defendants are not a party.

XII. Retention of Jurisdiction

    Jurisdiction is retained by this Court for the purpose of enabling 
any of the parties to this Final Judgment to apply to this Court at any 
time for such further orders and directions as may be necessary or 
appropriate for the construction or carrying out of this Final 
Judgment, for the modification of any of the provisions hereof, for the 
enforcement of compliance herewith, and for the punishment of any 
violations hereof.

XIII. Termination

    Unless this Court grants an extension, this Final Judgment will 
expire upon the tenth anniversary of the date of its entry.

XIV. Public Interest

    Entry of this Final Judgment is in the public interest.

    Dated: __________, 2001.

    Court approval subject to procedures of the Antitrust Procedures 
and Penalties Act, 15 U.S.C. 16.

----------------------------------------------------------------------
United States District Judge

Competitive Impact Statement

    The United States, pursuant to Section 2(b) of the Antitrust 
Procedures and Penalties Act (``APPA''), 15 U.S.C. 16(b)-(h), files 
this Competitive Impact Statement relating to the proposed Final 
Judgment submitted for entry in this civil antitrust proceeding.

I. Nature and Purpose of This Proceeding

    The United States filed a civil antitrust Complaint under Section 
15 of the Clayton Act, 15 U.S.C. 25 on December 18, 2000, alleging 
Aktiebolaget Volvo's (``AB Volvo'') acquisition of Renault V.I.S.A. 
(``Renault V.I.''), which includes Mack Trucks, Inc. (``Mack''), from 
Renault S.A. (``Renault'') would substantially lessen competition in 
violation of Section 7 of the Clayton Act, as amended, 15 U.S.C. 18.
    The Complaint alleges the defendants are the two largest producers 
of heavy duty (class 8), low cab over engine straight trucks (``LCOE 
Trucks'' in the United States. The proposed acquisition would result in 
AB Volvo accounting for approximately 96 percent of heavy duty LCOE 
Truck sales in the United States. The Complaint alleges the transaction 
will substantially lessen competition in the development, production, 
and sale of heavy duty LCOE Trucks sold in the United States, thereby 
harming consumers. Accordingly, the prayer for relief in the Complaint 
seeks: (1) A judgment that the proposed acquisition would violate 
Section 7 of the Clayton Act; (2) a permanent injunction preventing the 
defendants from carrying out the acquisition or otherwise combining 
their businesses or assets; (3) an award to the United States of its 
costs in bringing the lawsuit; and (4) such other relief as the Court 
deems proper.
    When the Complaint was filed, the United States also filed a 
proposed settlement permitting AB Volvo to acquire Renault V.I., 
provided AB Volvo divested its Volvo Trucks North America, Inc. 
(``VTNA'') LCOE Truck Business (a term defined in the proposed Final 
Judgment) to preserve competition. The settlement consists of a 
proposed Final Judgment and a Hold Separate Stipulation and Order.
    The proposed Final Judgment orders the defendants to divest the 
VTNA LCOE Truck Business to an acquirer approved by the United States. 
The defendants must complete the divestiture within ninety (90) 
calendar days after the filing of the Complaint, or five days after 
notice of the entry of the Final Judgment, whichever is later. The 
United States may extend the time period for divestiture two additional 
periods, each not to exceed 30 days. If the defendants do not complete 
the divestiture within the prescribed time, then, under the terms of 
the proposed Final Judgment, the Court will appoint a trustee to 
achieve the divestiture. If a trustee is appointed, the trustee shall 
have the option of divesting either the VTNA LCOE Truck Business or the 
Mack LCOE Truck Business (a term defined in the proposed Final 
Judgment).
    The United States and defendants have stipulated that the proposed 
Final Judgment may be entered after compliance with the APPA. Entry of 
the proposed Final Judgment would terminate this action, except that 
the Court would retain jurisdiction to construe, modify or enforce the 
provisions of the proposed Final Judgment and to punish violations 
thereof.

[[Page 11325]]

II. Description of the Events Giving Rise to the Alleged Violation 
of the Antitrust Laws

A. The Defendants and the Proposed Acquisition

1. Aktiebolaget Volvo
    AB Volvo is a foreign corporation organized and existing under the 
laws of Sweden with its corporate headquarters and principal place of 
business in Gotenburg, Sweden. AB Volvo is an international 
manufacturer of trucks, construction equipment, and engines. AB Volvo, 
through its subsidiary, VTNA, is the second largest U.S. manufacturer 
of heavy duty LCOE Trucks. AB Volvo reported revenue of approximately 
$14.7 billion in 1999.
2. Volvo Trucks North America, Inc.
    VTNA is a corporation organized and existing under the laws of the 
state of Delaware with its corporate headquarters and principal place 
of business in Greensboro, North Carolina. VTNA produces trucks in 
Dublin, Virginia. VTNA's 1999 revenues were approximately $2.39 
billion.
3. Renault S.A.
    Renault is a foreign corporation organized and existing under the 
laws of France that has its corporate headquarters and principal place 
of business in Boulogne-Billancourt, France. Renault is an 
international manufacturer of automobiles, trucks, buses, and engines. 
Renault reported revenue of approximately $39 billion in 1999.
4. Renault V.I.S.A.
    Renault V.I. is a foreign corporation organized and existing under 
the laws of France with its corporate headquarters and principal place 
of business in Lyon, France. Renault V.I. is a subsidiary of Renault 
and produces trucks and truck engines.
5. Mack Trucks, Inc.
    Mack is a corporation organized and existing under the laws of the 
Commonwealth of Pennsylvania with its corporate headquarters and 
principal place of business in Allentown, Pennsylvania. Mack, which is 
a subsidiary of Renault V.I., produces trucks and engines. Mack is the 
largest United States manufacturer of heavy duty LCOE Trucks. Mack 
reported revenues of approximately $2.2 billion in 1999.

B. The Proposed Acquisition

    On or about July 18, 2000, AB Volvo entered into an agreement with 
Renault to acquire Renault V.I. from Renault in exchange for 15% of AB 
Volvo's outstanding voting security which has an approximate value of 
$1.8 billion. The proposed acquisition would substantially lessen 
competition in the heavy duty LCOE Truck segment of the heavy duty 
truck industry and precipitated the United States' antitrust suit.

C. The Heavy Duty LCOE Truck Business and the Competitive Effects of 
the Acquisition

1. The Heavy Duty LCOE Truck Market
    The Complaint alleges the development, production, and sale of 
heavy duty LCOE Trucks is a line of commerce and a relevant product 
market within the meaning of Section 7 of the Clayton Act. Heavy duty 
trucks (or ``class 8'' trucks) are those trucks capable of carrying the 
heaviest payload capacities or gross vehicle weights, exceeding 33,000 
pounds. In addition to payload capacity, heavy duty trucks are 
distinguished from lighter duty trucks by large powerful diesel engines 
and other heavy duty components. Heavy duty LCOE Trucks are configured 
with the cab located over or in front of the engine, and a windshield 
which is even with the front bumper. The design gives heavy duty LCOE 
Trucks superior visibility and maneuverability compared to conventional 
cab, heavy duty, straight trucks which are designed with their engines 
in front of the cab. Heavy duty LCOE Trucks have a lower entry point to 
the cab (18 inches), compared to conventional straight trucks (almost 
four feet).
    The design of heavy duty LCOE Trucks makes them uniquely suited to 
specific applications. Most heavy duty LCOE Trucks are sold to the 
refuse industry, which requires heavy duty trucks to handle the weight 
of the waste material being hauled. Refuse companies often attach a 
mechanical fork lift to heavy duty LCOE Trucks to lift commercial 
dumpsters over the cab, emptying them into the body of the truck. Such 
a mechanical fork lift cannot be used with trucks designed with engines 
in front of the cab because that design has an extended hood which 
would block the lift's operation. Similarly, the LCOE design provides 
superior maneuverability and visibility needed in urban and residential 
streets and alleys. Finally, the low height for entry into the cab 
makes the LCOE design significantly preferable for refuse use because 
drivers need to exit and enter the truck often. The ease of cab entry 
and the superior maneuverability and visibility of heavy duty LCOE 
Trucks also makes them the truck of choice for various other 
applications such as home heating oil delivery in the Northeastern 
United States, concrete pumping, and aircraft refueling.
    There are no good substitutes for heavy duty LCOE Trucks. A 
sufficient number of purchasers of heavy duty LCOE Trucks would not 
turn to substitutes in response to a small but significant increase in 
the price of heavy duty LCOE Trucks to make such price increase 
unprofitable. Accordingly, the development, production, and sale of 
heavy duty LCOE Trucks is a relevant product market in which to assess 
the competitive effects of the proposed acquisition.
    The Complaint alleges the United States constitutes the relevant 
geographic market for the purposes of analyzing the transaction. 
Virtually all heavy duty LCOE Trucks sold in the United States are 
manufactured in the United States and almost none are imported. The 
foreign-headquartered truck manufacturers that sell heavy duty LCOE 
Trucks in the United States manufacture the trucks at facilities 
located in the United States. Classifications, standards, and customer 
preferences for heavy duty LCOE Trucks produced for Asia and Europe 
differ from those produced for the United States. A small but 
significant increase in the price of heavy duty LCOE Trucks would not 
cause a sufficient number of purchasers to switch to trucks 
manufactured outside the United States to make the price increase 
unprofitable.
2. Anticompetitive Consequences of the Acquisition
    The Complaint alleges that AB Volvo's acquisition of Renault will 
likely have the following anticompetitive effects: (a) Competition 
generally in the development, production and sale of heavy duty LCOE 
Trucks would be substantially lessened; (b) the actual and potential 
competition between Volvo and Renault would be eliminated; and (c) 
prices for heavy duty LCOE Trucks would likely increase and the 
quality, level of service, and product improvement of heavy duty LCOE 
Trucks would likely decline.
    VTNA and Mack are the only significant suppliers of heavy duty LCOE 
Trucks in the United States. In this highly concentrated market, Mack 
has approximately a 53 percent market share, and VTNA has approximately 
a 33 percent market share. VTNA and Mack compete directly and 
aggressively against one another on the development, production, and 
sale of heavy duty LCOE Trucks which has benefited consumers through 
lower prices, higher

[[Page 11326]]

quality, better service, and improved products.
    The proposed acquisition would substantially increase concentration 
in an already highly concentrated market. After the acquisition, the 
combined firm would account for approximately 86 percent of heavy duty 
LCOE Truck sales in the United States. Using the Herfindahl-Hirschman 
Index (``HHI,'' which is defined and explained in Appendix A of the 
Complaint), the proposed transaction will increase the HHI by more than 
4000 points to a post-merger level of about 7508, far in excess of the 
level which ordinarily raise antitrust concerns.
    The proposed acquisition will raise the combined firms' share of 
industry sales to the level where it will have the ability and 
incentive to raise prices unilaterally. The heavy duty LCOE Trucks of 
VTNA and Mack are significantly differentiated from their other 
competitors' heavy duty LCOE Trucks in terms of their actual and proven 
track record for reliability, maintenance requirements, and significant 
components. Mack's and VTNA's heavy duty LCOE Trucks are the closest 
substitutes for each other and their customers would not divert a 
sufficient number of their purchases to competing heavy duty LCOE 
Trucks to defeat a significant price increase by the defendants 
following a merger.
    The Complaint alleges that entry into the production and sale of 
heavy duty LCOE Trucks in the United States is difficult, time 
consuming, and expensive, and would not be timely, likely or sufficient 
to deter the exercise of market power by the combined firm in the 
readily foreseeable future. Entry, even by an established producer of 
other types of heavy duty trucks, would require a high sunk capital 
investment in research and development and equipment and facilities. A 
new entrant would also need to develop an effective dealer network for 
selling and servicing heavy duty LCOE Trucks and would need to develop 
a track record for reliability and maintenance before it would attract 
significant sales from Mack and VTNA. Even an established producer of 
other types of heavy duty trucks with a dealer network for those trucks 
would need in excess of two years to design, produce, and gain customer 
acceptance of a new heavy duty LCOE Truck.

III. Explanation of the Proposed Final Judgment

    The proposed Final Judgment is designed to ensure competition 
otherwise eliminated as a result of the proposed acquisition is 
preserved, and to prevent AB Volvo from exercising market power in the 
heavy duty LCOE Truck market after the acquisition. To maintain 
competition in the heavy duty LCOE Truck market. Section IV of the 
proposed Final Judgment orders the defendants to sell the VTNA LCOE 
Truck Business. The proposed Final Judgment also requires the 
defendants to negotiate agreements with the purchaser guaranteeing the 
divested business will meet EPA 2002 emissions standards and, at the 
purchaser's option, to provide start-up support for the divested LCOE 
Truck Business for a period of up to two years. The defendants are 
prohibited by the proposed Final Judgment from taking any action that 
will impede their dealers from distributing, selling or servicing the 
divested heavy duty LCOE Trucks.
    Under the terms of the proposed Final Judgment, defendants must 
accomplish the divestiture within ninety (90) calendar days after the 
date the Complaint is filed, or five days after notice of entry of the 
Final Judgment, whichever is later, to an acquirer that, in the United 
States's sole judgment, has the intent and capability (including the 
necessary managerial, operational, technical and financial capability) 
of competing effectively in the development, production, and sale of 
heavy duty LCOE Trucks. The United States may extend the time period 
for divestiture two additional periods, each not to exceed 30 days. 
Defendants must use their best efforts to divest the VTNA LCOE Truck 
Business as expeditiously as possible and, until the ordered 
divestitures take place, the defendants must cooperate with any 
prospective purchasers.
    If defendants do not accomplish the ordered divestitures within the 
prescribed time period, Section VI(A) of the proposed Final Judgment 
provides that the Court will appoint a trustee, selected by the United 
States, to complete the divestiture. The trustee may divest either the 
VTNA or Mack LCOE Truck Business. The trustee has the right, upon 
notice to the defendants and upon consultation with the United States, 
to add such other assets and agreements concerning necessary parts and 
components, in order to ensure the viability, competitiveness, and 
marketability of the Mack LCOE Truck Business.
    If a trustee is appointed, the proposed Final Judgment provides the 
defendants must cooperate fully with the trustee and pay all the 
trustee's costs and expenses. The trustee's compensation will be 
structured to provide an incentive for the trustee based on the price 
and terms of the divestiture and the speed with which it is 
accomplished. After the trustee's appointment becomes effective, the 
trustee will file monthly reports with the United States and the Court 
setting forth the trustee's efforts to accomplish the required 
divestiture. If the divestiture is not accomplished within six months 
after the trustee's appointment, the trustee and the United States will 
make recommendations to the Court, which shall enter such orders as 
appropriate to carry out the purpose of the Final Judgment.
    Until the divestiture is accomplished, the terms of the Hold 
Separate Stipulation and Order require the defendants to preserve, 
maintain, and continue to operate the VTNA and Mack LCOE Truck 
Businesses as independent, economically viable parts of ongoing 
competitive businesses, with the management, sales, and operations held 
separate from the post-merger company's other operations. The 
defendants will appoint two designated persons to monitor and ensure 
their compliance with these requirements.

IV. Remedies Available to Potential Private Litigants

    Section 4 of the Clayton Act, 15 U.S.C. 15, provides that any 
person who has been injured as a result of conduct prohibited by the 
antitrust laws may bring suit in federal district court to recover 
three times the damages the person has suffered, as well as the costs 
of bringing a lawsuit and reasonable attorneys' fees. Entry of the 
proposed Final Judgment will neither impair nor assist the bringing of 
any private antitrust damage action. Under the provisions of Section 
5(a) of the Clayton Act, 15 U.S.C. 16(a), the proposed Final Judgment 
has no effect as prima facie evidence in any subsequent private lawsuit 
that may be brought against the defendants.

V. Procedures Available for Modification of the Proposed Final 
Judgment

    The United States and the defendants have stipulated that the 
proposed Final Judgment may be entered by the Court after compliance 
with the provisions of the APPA, provided that the United States has 
not withdrawn its consent. The APPA conditions entry of the decree upon 
the Court's determination that the proposed Final Judgment is in the 
public interest.
    The APPA provides a period of at least sixty (60) days preceding 
the effective date of the proposed Final Judgment within which any 
person may submit to the United States written comments regarding the 
proposed Final

[[Page 11327]]

Judgment. Any person who wishes to comment should do so within sixty 
(60) days of the date of publication of this Competitive Impact 
Statement in the Federal Register. The United States will evaluate and 
respond to the comments. All comments will be given due consideration 
by the Department of Justice, which remains free to withdraw its 
consent to the proposed Final Judgment at any time prior to entry. The 
comments and the response of the United States will be filed with the 
Court and published in the Federal Register. Written comments should be 
submitted to: J. Robert Kramer II, Chief, Litigation II Section, 
Antitrust Division, United States Department of Justice, 1401 H Street, 
N.W., Suite 3000, Washington, D.C. 20530.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. Alternatives to the Proposed Final Judgment

    The United States considered, as an alternative to the proposed 
Final Judgment, a full trail on the merits against the defendants. The 
United States is satisfied, however, that the diverstiture of either 
the VTNA or Mack LCOE Truck Business and other relief contained in the 
proposed Final Judgment will establish, preserve and ensure a viable 
competitor in the development, production, and sale of heavy duty LCOE 
Trucks in the United States. Thus, the United States is convinced that 
the proposed Final Judgment, once implemented by the Court, will 
prevent AB Volvo's acquisition of Renault V.I. from having adverse 
competitive effects.

VII. Standard of Review Under the APPA for the Proposed Final 
Judgment

    The APPA requires that proposed consent judgments in antitrust 
cases brought by the United States be subject to a sixty (60) day 
comment period, after which the Court shall determine whether entry of 
the proposed Final Judgment is ``in the public interest.'' In making 
that determination, the Court may consider--

    (1) The competitive impact of such judgment, including 
termination of alleged violations, provisions for enforcement and 
modification, duration or relief sought, anticipated effects of 
alternative remedies actually considered, and any other 
considerations bearing upon the adequacy of such judgment;
    (2) the impact of entry of such judgment upon the public 
generally and individuals alleging specific injury from the 
violations set forth in the complaint including consideration of the 
public benefit, if any, to be derived from a determination of the 
issues at trail.

15 U.S.C. 16(e). As the Court of Appeals for the District of Columbia 
has held, the APPA permits a court to consider, among other things, the 
relationship between the remedy secured and the specific allegations 
set forth in the government's complaint, whether the decree is 
sufficiently clear, whether enforcement mechanisms are sufficient, and 
whether the decree may positively harm third parties. See United States 
v. Microsoft Corp., 56 F. 3d 1448, 1458-62 (D.C. Cir. 1995).
    In conducting this inquiry, ``the Court is nowhere compelled to go 
to trail or to engage in extended proceedings which might have the 
effect of vitiating the benefits of prompt and less costly settlement 
through the consent decree process.''\1\ Rather,
---------------------------------------------------------------------------

    \1\ 119 Cong. Rec. 24,598 (1973). See United States v. Gillette 
Co., 406 F. Supp. 713, 715 (D. Mass. 1975). A ``public interest'' 
determination can be made properly on the basis of the Competitive 
Impact Statement and Response to Comments filed pursuant to the 
APPA. Although the APPA authorizes the use of additional procedures, 
15 U.S.C. 16(f), those procedures are discretionary. A court need 
not invoke any of them unless it believes that the comments have 
raised significant issues and that further proceedings would aid the 
court in resolving those issues. See H.R. Rep. No. 93-1463, 93rd 
Cong. 2d Sess. 8-9 (1974), reprinted in 1974 U.S.C.C.A.N. 6535, 
6538.

absent a showing of corrupt failure of the government to discharge 
its duty, the Court, in making its public interest finding, should * 
* * carefully consider the explanations of the government in the 
competitive impact statement and its responses to comments in order 
to determine whether those explanations are reasonable under the 
circumstances.\2\
---------------------------------------------------------------------------

    \2\ United States v. Mid-America Dairymen, Inc., 1977-1 Trade 
Cas (CCH) 61,508, at 71, 980 (W.D. Mo. 1977); see also United States 
v. Loew's Inc., 783 Supp. 211, 214 (S.D.N.Y 1992); United States v. 
Columbia Artists Mgmt., Inc., 662 F. Supp. 865, 870 (S.D.N.Y. 1987).

    Accordingly, with respect to the adequacy of the relief secured by 
the decree, a court may not ``engage in unrestricted evaluation of what 
relief would best serve the public.'' United States v. BNS, Inc., 858 
F.2d 456, 462 (9th Cir. 1988), quoting United States v. Bechtel Corp., 
648 F.2d 660, 666 (9th Cir.), cert. denied, 454 U.S. 1083 (1981); see 
---------------------------------------------------------------------------
also Microsoft, 56 F.3d at 1458. Precedent requires that

the balancing of competing social and political interests affected 
by a proposed antitrust consent decree must be left, in the first 
instance, to the discretion of the Attorney General. The court's 
role in protecting the public interest is one of insuring that the 
government has not breached its duty to the public in consenting to 
the decree. The court is required to determine not whether a 
particular decree is the one that will best serve society, but 
whether the settlement is ``within the reaches of the public 
interest.'' More elaborate requirements might undermine the 
effectiveness of antitrust enforcement by consent decree.\3\
---------------------------------------------------------------------------

    \3\ United States v. Bechtel Corp., 648 F.2d at 666 (citations 
omitted) (empahsis added); see United States v. BNS, Inc., 858 F.2d 
at 463; United States v. National Broadcasting Co., 449 F. Supp. 
1127, 1143 (C.D. Cal. 1978); United States v. Gillette Co., 406 F. 
Supp. at 716. See also United States v. American Cyanamid Co., 719 
F.2d 558, 565 (2d Cir. 1983), cert. denied, 465 U.S. 1101 (1984).

    The proposed Final Judgment, therefore, should not be reviewed 
under a standard of whether it is certain to eliminate every 
anticompetitive effect of a particular practice or whether it mandates 
certainty of free competition in the future. Court approval of a final 
judgment requires a standard more flexible and less strict than the 
standard required for a finding of liability. A ``proposed decree must 
be approved even if it falls short of the remedy the court would impose 
on its own, as long as it falls within the range of acceptability or is 
`within the reaches of public interest.' ''\4\
---------------------------------------------------------------------------

    \4\ United States v. American Tel. & Tel. Co., 552 F. Supp. 131, 
151 (D.D.C. 1982) (quoting Gillette, 406 F. Supp. at 716), aff'd sub 
nom. Maryland v. United States, 460 U.S. 1001 (1983); United States 
v. Alcan Aluminum, Ltd., 605 F. Supp. 619, 622 (W.D. Ky. 1985); 
United States v. Carrols Dev. Corp., 454 F. Supp. 1215, 1222 
(N.D.N.Y. 1978).
---------------------------------------------------------------------------

    Moreover, the court's role under the APPA is limited to reviewing 
the remedy in relationship to the violations that the United States has 
alleged in its complaint, and does not authorize the court to 
``construct [its] own hypothetical case and then evaluate the decree 
against that case.'' Microsoft, 56 F.3d at 1459. Since the ``court's 
authority to review the decree depends entirely on the government's 
exercising its prosecutorial discretion by bringing a case in the first 
place,'' it follows that the court ``is only authorized to review the 
decree itself,'' and not to ``effectively redraft the complaint'' to 
inquire into other matters that the United States might have but did 
not pursue. Id.

VIII. Determinative Documents

    There are no determinative materials or documents within the 
meaning of the APPA that were considered by the United States in 
formulating the proposed Final Judgment.
    Dated: February 6, 2001.

Respectfully submitted,

Frederick H. Parmenter,
Senior Trail Attorney, U.S. Department of Justice, Antitrust 
Division, Litigation II Section, 1401 H Street, NW., Suite 3000, 
Washington, DC 20530, (201) 307-0620.

[[Page 11328]]

Certificate of Service

    I hereby certify under penalty of perjury that a copy of the 
COMPETITIVE IMPACT STATEMENT has been served upon Aktiebolaget Volvo; 
Volvo Trucks North America, Inc.; Renault S.A.; Renault V.I.S.A.; and 
Mack Trucks, Inc., by placing a copy of the aforementioned document in 
the U.S. Mail, directed to each of the above-named parties at the 
addresses given below, this 6th day of February, 2001.

Aktiebolaget Volvo and Volvo, Trucks North America, Inc., c/o Kevin 
Arquit, Esq., Clifford Chance Rogers & Wells LLP, 200 Park Avenue, 
New York, NY 10166-0153.
Renault S.A., Renault V.I.S.A. and Mack Trucks, Inc., c/o Richard J. 
Urowsky, Esq., Sullivan & Cromwell, 125 Broad Street, New York, NY 
10004-2498.

Federick H. Parmenter,
Virginia Bar No.: 18184, Senior Trial Attorney, U.S. Department of 
Justice, Antitrust Division, 1401 H Street, NW., Suite 3000, 
Washington, DC 20530, (202) 307-0620.

[FR Doc. 01-4517 Filed 2-22-01; 8:45 am]
BILLING CODE 4410-11-M