Considerations For Companies Seeking Competitor Collaborations

There are many legitimate reasons why your company may wish to collaborate with one of its competitors. You may, for example, want to enter into an agreement with your competitor to develop a new product. Collaboration between competitors that leads to innovation and directly benefits customers is normally permissible under competition law. However, you need to be careful, as there are competition law risks when competitors interact to such an extent that they are no longer acting independently. Certain forms of collaboration between competitors are illegal under competition law and carry serious consequences, including:

• Fines.
• Agreements being declared void.
• Director disqualification in some jurisdictions (e.g., the UK).