Environmental Engineering Reference
In-Depth Information
secretive venues so that proprietary designs remain
protected under IP law.
SDO standardization venues are increasingly
regulated by both contextual and normative con-
straints. The U.S. standardization umbrella organi-
zation, ANSI, is a private body standardizing SDA.
ANSI specifies that due process requirements must
be followed by VCSB for the standards produced,
before they can be designated as American Na-
tional Standards (ANSI 2008). ANSI's due process
requirements are actually democratic principles
similar to those followed in many democratic na-
tions for legislation and regulatory rulemaking.
Another influence on SDA to require compliance
with democratic principles comes from the U.S.
Office of Management and Budget's OMB Circu-
lar A-119. Federal regulatory agencies in the U.S.
are encouraged to participate and adopt standards
developed in SDA so long as they are compliant
with OMB A-119, which are similar to ANSI's
due process requirements (OMB A-119 1998).
The U.S. exerts additional incentives on SDOs to
follow democratic principles under the Standards
Development Organization Advancement Act of
2004 (SDOAA). The SDOAA provides a partial
antitrust exemption for SDAs compliant with the
SDOAA (SDOAA 2004).
Two aspects of modern standardization raise
the risk of antitrust scrutiny: (1) the traditional
suspicion that collaborative activity is collusive
and (2) the increasing inclusion of IP rights in many
standards. Such antitrust scrutiny is of particular
concern to traditional consortia, particularly those
outside the U.S., unless they impose similar due
process requirements to achieve democratic prin-
ciples and regulate IP in resulting standards. The
SDOAA's limited antitrust immunity is premised
on a Congressional finding that SDA are beneficial
for society as well as for government. When SDO's
have democratic principles discussed above, a
more lenient, rule of reason approach applies to
the collaboration, rather than the stringent, per se
rule. Furthermore, treble damages are not permit-
their SDA for review by antitrust regulators: DoJ
and FTC. The collaboration in SDA runs the risk
of liability for collusive antitrust offenses such as
price-fixing, tying, concerted refusals to deal, and
the creation of barriers to entry by competitors or
alternate technologies (Allied Tube 1988). While
these antitrust offenses are typically considered
automatically unlawful under the per se rule,
compliance with SDOAA democratic principles
permits application of the more lenient rule
of reason. The per se rule developed as courts
encountered repetitive collusive activities that
were never justified, making them automatically
unlawful. Per se analysis is considered efficient
because it shortens trials and provides clear guid-
ance but can be unfair when applied to SDA. The
SDO must file a notice with antitrust regulators to
receive this partial immunity. The rule of reason
requires an ad hoc analysis that can consume
considerable judicial and regulatory resources
so may be simultaneously both less efficient and
more fair to the collaborators. The SDOAA does
not immunize SDO bodies from international
antitrust enforcement, state antitrust enforcement
or private antitrust liability suits.
Democratic principles for SDA are based on
OMB A-119 and ANSI's due process requirements
which compel “equity and fair play” in “activities
related to the development of consensus for ap-
proval, revision, reaffirmation, and withdrawal of
American National Standards.” SDO must permit
participation by almost any party, the SDA must
consider each participant's contention and provide
for them to appeal adverse decisions. There are
eight ANSI “essential due process requirements”
as well as normative policies on intellectual
property, commercial terms and conditions, and
recordkeeping. These constitute standards for the
conduct of SDA .
American National Standards:
Due Process Requirements
◦
Openness
