[Federal Register Volume 78, Number 145 (Monday, July 29, 2013)]
[Notices]
[Pages 45536-45538]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-18070]


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FEDERAL TRADE COMMISSION

[File No. 121 0165]


Solera Holdings, Inc.; Analysis of Proposed Agreement Containing 
Consent Order To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed Consent Agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices or unfair methods of competition. The attached Analysis to 
Aid Public Comment describes both the allegations in the draft 
complaint and the terms of the consent order--embodied in the consent 
agreement--that would settle these allegations.

DATES: Comments must be received on or before August 22, 2013.

ADDRESSES: Interested parties may file a comment at https://ftcpublic.commentworks.com/ftc/soleraholdingsconsent online or on 
paper, by following the instructions in the Request for Comment part of 
the SUPPLEMENTARY INFORMATION section below. Write ASolera Holdings, 
File No. 121 0165'' on your comment and file your comment online at 
https://ftcpublic.commentworks.com/ftc/soleraholdingsconsent by 
following the instructions on the web-based form. If you prefer to file 
your comment on paper, mail or deliver your comment to the following 
address: Federal Trade Commission, Office of the Secretary, Room H-113 
(Annex D), 600 Pennsylvania Avenue NW., Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT: Scott Reiter (202-326-2886), FTC, 
Bureau of Competition, 600 Pennsylvania Avenue NW., Washington, DC 
20580.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned

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consent agreement containing a consent order to cease and desist, 
having been filed with and accepted, subject to final approval, by the 
Commission, has been placed on the public record for a period of thirty 
(30) days. The following Analysis to Aid Public Comment describes the 
terms of the consent agreement, and the allegations in the complaint. 
An electronic copy of the full text of the consent agreement package 
can be obtained from the FTC Home Page (for July 22, 2013), on the 
World Wide Web, at http://www.ftc.gov/os/actions.shtm. A paper copy can 
be obtained from the FTC Public Reference Room, Room 130-H, 600 
Pennsylvania Avenue NW., Washington, DC 20580, either in person or by 
calling (202) 326-2222.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before August 22, 2013. 
Write ASolera Holdings, File No. 121 0165'' on your comment. Your 
comment B including your name and your state B will be placed on the 
public record of this proceeding, including, to the extent practicable, 
on the public Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of discretion, the Commission tries to 
remove individuals' home contact information from comments before 
placing them on the Commission Web site.
    Because your comment will be made public, you are solely 
responsible for making sure that your comment does not include any 
sensitive personal information, like anyone's Social Security number, 
date of birth, driver's license number or other state identification 
number or foreign country equivalent, passport number, financial 
account number, or credit or debit card number. You are also solely 
responsible for making sure that your comment does not include any 
sensitive health information, like medical records or other 
individually identifiable health information. In addition, do not 
include any A[t]rade secret or any commercial or financial information 
which * * * is privileged or confidential,'' as discussed in Section 
6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 
4.10(a)(2). In particular, do not include competitively sensitive 
information such as costs, sales statistics, inventories, formulas, 
patterns, devices, manufacturing processes, or customer names.
    If you want the Commission to give your comment confidential 
treatment, you must file it in paper form, with a request for 
confidential treatment, and you have to follow the procedure explained 
in FTC Rule 4.9(c), 16 CFR 4.9(c).\1\ Your comment will be kept 
confidential only if the FTC General Counsel, in his or her sole 
discretion, grants your request in accordance with the law and the 
public interest.
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    \1\ In particular, the written request for confidential 
treatment that accompanies the comment must include the factual and 
legal basis for the request, and must identify the specific portions 
of the comment to be withheld from the public record. See FTC Rule 
4.9(c), 16 CFR 4.9(c).
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    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/soleraholdingsconsent by following the instructions on the web-
based form. If this Notice appears at http://www.regulations.gov/#!home. you also may file a comment through that Web site.
    If you file your comment on paper, write ASolera Holdings, File No. 
121 0165'' on your comment and on the envelope, and mail or deliver it 
to the following address: Federal Trade Commission, Office of the 
Secretary, Room H-113 (Annex D), 600 Pennsylvania Avenue NW., 
Washington, DC 20580. If possible, submit your paper comment to the 
Commission by courier or overnight service.
    Visit the Commission Web site at http://www.ftc.gov to read this 
Notice and the news release describing it. The FTC Act and other laws 
that the Commission administers permit the collection of public 
comments to consider and use in this proceeding as appropriate. The 
Commission will consider all timely and responsive public comments that 
it receives on or before August 22, 2013. You can find more 
information, including routine uses permitted by the Privacy Act, in 
the Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

Analysis of Agreement Containing Consent Order to Aid Public Comment

I. Introduction

    The Federal Trade Commission (``Commission'') has accepted, subject 
to final approval, an Agreement Containing Consent Order (``Consent 
Agreement'') with Solera Holdings, Inc. (``Solera''), which is designed 
to remedy the anticompetitive effects of its consummated acquisition of 
Actual Systems of America, Inc. (``Actual Systems''). Under the terms 
of the Consent Agreement, Solera is required to divest assets related 
to Actual Systems' United States and Canadian yard management system 
(``YMS'') business to ASA Holdings, Inc. (``ASA Holdings'').
    The proposed Consent Agreement requires Solera to provide ASA 
Holdings with assets related to Actual Systems' United States and 
Canadian YMS business. The assets include contracts and licenses with 
current Actual Systems customers in the United States and Canada, and 
co-ownership of all intellectual property related to Actual Systems 
products sold in the United States and Canada. This Consent Agreement 
would preserve the competition that was eliminated through the 
acquisition.
    The proposed Consent Agreement has been placed on the public record 
for thirty days, and comments from interested persons have been 
requested. Comments received during this period will become part of the 
public record. After thirty days, the Commission will again review the 
proposed Consent Agreement and the comments received, and will decide 
whether it should withdraw from the proposed Consent Agreement, modify 
it, or make final the accompanying Decision and Order.
    Pursuant to a Stock Purchase Agreement dated May 29, 2012, Solera 
acquired all of the stock of Actual Systems. Through a separate Stock 
Purchase Agreement and Asset Purchase Agreement executed that same day, 
Solera acquired 100% of the stock of Actual Systems U.K., Ltd. 
(``ASUK'') and Beech Systems, Ltd. (``Beech''). Solera paid 
approximately $8.7 million collectively for the three companies, which 
shared common ownership.
    Solera, through its wholly-owned subsidiary Hollander, Inc. 
(``Hollander''), and Actual Systems both provide YMS to the automotive 
recycling industry. In particular, at the time of the acquisition, 
Hollander and Actual Systems were two of only three meaningful 
providers of YMS in the United States and Canada. The Commission's 
Complaint alleges that the consummated acquisition violated Section 7 
of the Clayton Act, as amended, 15 U.S.C. 18, and Section 5 of the 
Federal Trade Commission Act, as amended, 15 U.S.C. 45, in the market 
for YMS. The proposed Consent Agreement remedies the alleged violations 
by replacing the lost competition in the relevant market that resulted 
from the acquisition.

II. The Product and Structure of the Market

    The relevant product market in which to analyze the competitive 
effects of the acquisition is YMS. The relevant

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geographic market in which to analyze the competitive effects of the 
acquisition is the United States and Canada. Hollander and Actual 
Systems are closest competitors in this market and are two of only 
three competitively meaningful YMS providers.

III. Effects of the Acquisition

    The acquisition is likely to result in significant anticompetitive 
harm in the highly-concentrated YMS market. Solera and Actual Systems 
were two of only three significant competitors in this market. The 
acquisition has eliminated actual, direct, and substantial competition 
between Solera and Actual Systems, and likely will result in higher 
prices and reduced innovation for YMS.

IV. Entry

    Entry or repositioning is not likely to avert the anticompetitive 
impact of Solera's acquisition of Actual Systems. The time and cost 
required to develop a YMS are substantial, and far outweigh the 
potential profit incentives for either new entrants or firms operating 
in adjacent markets. In addition, it would be difficult for a new 
entrant to obtain a license to the Hollander Interchange, an auto parts 
database required to compete in the YMS market.

V. The Proposed Consent Agreement

    The proposed Consent Agreement remedies the competitive concerns 
raised by the transaction by requiring Solera to divest assets related 
to Actual Systems' United States and Canadian business to ASA Holdings. 
This divestiture preserves competition that was eliminated as a result 
of the acquisition.
    ASA Holdings is comprised of individuals with extensive experience 
with Actual Systems and the YMS market. The main principal of ASA 
Holdings is Peter Riddle. Mr. Riddle founded ASUK in 1985, developed 
the base YMS software program that would become Actual Systems' YMS, 
and formed Actual Systems in the United States. The other members of 
ASA Holdings are Emilio Fontana and Peter Bishop. Mr. Fontana was 
involved with Actual Systems since the mid-1990s, including serving as 
a member of its Board of Directors. Mr. Bishop worked for Actual 
Systems for over 10 years, including serving as its General Manager and 
Director from 2004 until its acquisition by Solera. The terms required 
by the proposed Consent Agreement will enable ASA Holdings to 
effectively replace the competition in the YMS market lost as a result 
of the acquisition.
    The proposed Consent Agreement also contains several provisions 
designed to ensure that the divestiture is successful. For instance, 
Solera must provide ASA Holdings with a license to the Hollander 
Interchange lasting the length of the proposed Consent Agreement.
    If the Commission determines that ASA Holdings is not an acceptable 
acquirer of the assets to be divested, or that the manner of the 
divestiture is not acceptable, Solera must rescind the divestiture and 
divest the assets within 120 days of the date the Order becomes final 
to another Commission-approved acquirer. If Solera fails to divest the 
assets within the 120 days, the Commission may appoint a trustee to 
divest the relevant assets.
    The purpose of this analysis is to facilitate public comment on the 
proposed Consent Agreement, and it is not intended to constitute an 
official interpretation of the proposed Consent Agreement or to modify 
its terms in any way.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2013-18070 Filed 7-26-13; 8:45 am]
BILLING CODE 6750-01-P