Interactions with Competitors

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At Abbott, we are committed to fair dealing and complying with competition laws.

Competition benefits everyone, from businesses to consumers to the economy as a whole. Competition results in dynamic markets, leading to increased productivity and better value for consumers.

Upon completion of this course, you will:

• Be able to explain what anti-competitive behavior is, who it impacts, and how.
• Recognize that there are laws and regulations designed to prevent anti-competitive behavior.
• Understand Abbott’s expectations for conducting business globally in the right way.
• Know where to go for help and support.

[1] Welcome

1 minute

[2] Introduction to Antitrust

2 minutes

[3] Laws and Regulations

4 minutes

[4] The Impact on Our Business and Our Responsibilities

5 minutes

[5] Your Commitment

1 minute

[6] Knowledge Check

3 minutes

Learning Progress

This Topic is now available.

In our day-to-day work activities, we sometimes interact with competitors.

These interactions may take place in formal settings like when we are participating in tenders or trade association meetings, or in less formal settings like chance encounters in doctors’ offices. Regardless of the setting, any interaction with a competitor could potentially pose a risk to you and Abbott.

As a healthcare company, it is critical that we always do what is right for the many people we serve.

This includes complying with antitrust laws designed to prevent unfair competition.

Competition laws, also known as antitrust laws, exist to protect consumers from conduct that is anti-competitive, deceptive, or unfair.

These laws prohibit agreements that eliminate or discourage competition and apply to many aspects of our business, including relationships with competitors, prices, marketing and trade practices, and terms of sale to distributors and other customers.

Quick Check

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It is okay during an informal conversation to discuss product prices with competitors?

True

False

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That's correct!

That's not correct!

We must always exercise caution when interacting with competitors. You should not discuss sensitive business topics such as prices, sales terms, business or marketing plans, margins, costs, production capacity, inventory levels or discounts with competitors.

[1] Welcome

1 minute

[2] Introduction to Antitrust

2 minutes

[3] Laws and Regulations

4 minutes

[4] The Impact on Our Business and Our Responsibilities

5 minutes

[5] Your Commitment

1 minute

[6] Knowledge Check

3 minutes

Learning Progress

This Topic is now available.

Most countries in which we do business have laws that prohibit unfair competition.

Abbott’s own standards on fair competition are consistent with our commitment to conduct business with honesty, fairness, and integrity.

These standards can be found in Abbott’s Code of Business Conduct and Ethics and Compliance Global Policy on Business Standards.

Ensuring Our Interactions with Competitors are Appropriate

Agreements or discussions with competitors regarding price, volume, limiting or controlling production or sales volume, customer or market allocation, tenders, requests for proposal, or bids are strictly prohibited.

Boycotts are also prohibited. Agreeing with a competitor not to deal with another company or supplier, or encouraging others to do so, could be construed as unfair competition.

Adhering to the Laws

We are committed to complying with competition laws in every country where we do business.

Fair, Merit-Based Tender Processes

Abbott is committed to competing fairly in all tenders, requests for proposals, and bids. Collusion with competitors, bid rigging, and similar actions which might inappropriately impact the outcome of selection processes are strictly prohibited.

Meetings with Competitors

When meeting with competitors, it is important to review the agenda to ensure that only appropriate topics are covered. Never engage in any discussion regarding pricing, tenders, boycotting of third parties, customer or territory allocation, or limiting production or sales volume.

If someone begins to discuss these matters, take immediate action. End your involvement in the meeting and ask that your objections be recorded. Leave and make a loud, dramatic gesture as you depart, so others remember your departure from the prohibited discussion.

Competitors and the Labor Market

Under competition laws, competitors include not only the companies with whom Abbott competes to sell our products, but also companies with whom we compete to hire employees.

For example, discussing employee compensation with another company or agreeing with another company not to hire each other’s employees (no poach agreements) can also be viewed as anti-competitive.

Reporting Suspected Violations

We are committed to reporting any suspected violation of Abbott’s policies related to unfair competition. We can do so through OEC, Legal, or Speak Up.

Quick Check

Test your knowledge now!

You are a Regional Sales Manager responsible for Abbott Vascular in Turkey. You are considering submitting a bid to supply product to a large public hospital in your area. You are aware that the contract is currently held by a local company. Before investing a lot of time into putting together the bid, you reach out to a counterpart at Medtronic to find out whether they are bidding. Is this okay?

Yes, as long as you do not discuss pricing, discounts, rebates or any other terms of the bid.

Yes, since the objective of the call is simply to establish whether or not Medtronic would bid.

No. Any discussion with competitors regarding pricing or bidding strategies is strictly prohibited.

Submit

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While there is no indication that the purpose of the call is to engage in rigging the bid, any discussion with a competitor about the terms of a bid or bidding strategies could be perceived as harmful to competition.

For instance, if both Medtronic and Abbott refrain from submitting competitive bids, it could leave the door open for a single firm to bid on the contract. This could result in the hospital paying more than would be expected in a competitive situation. This could subsequently be viewed by the authorities as a type of bid suppression.

You are an Area Sales Director for Abbott’s Rapid Diagnostics business in East Africa. At a meeting with a local distributor who distributes diagnostic testing equipment for you and a leading competitor, you are provided with a list of customers who the distributor says you should target for rapid diagnostic marketing. It is explained that a similar length list with different customers has been given to your competitor, so that the two companies’ marketing efforts don’t overlap. Since the distributor is responsible for the final sale of the companies’ products, you agree to limit your marketing efforts to the customers on the list. Is this okay?

Yes

No

Submit

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That's not correct!

Market or customer allocation is almost always illegal. The fact that the arrangement is being organized by a third party, in this case a local distributor, does not change the fact that dividing customers or geographic areas to avoid competition may result in customers paying more for their diagnostic equipment.

When communicating with third party suppliers and distributors, it is important for you to be alert to any arrangements that might be construed as limiting competition.

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Review

Take a moment to review some of the key concepts in this section.

Competition Laws

Most countries in which we do business have laws that prohibit unfair competition.

Fair, Merit-Based Tender Processes

Abbott is committed to competing fairly in all tenders, requests for proposals, and bids. Collusion with competitors, bid rigging, and similar actions which might inappropriately impact the outcome of selection processes are strictly prohibited.

Meetings with Competitors

Never engage in any discussion regarding pricing, tenders, boycotting of third parties, customer or territory allocation, or limiting production or sales volume.

Responding to Anti-competitive Discussions

If someone begins to discuss sensitive business topics, take immediate action. End your involvement in the meeting and ask that your objections be recorded. Leave and make a loud, dramatic gesture as you depart, so others remember your departure from the prohibited discussion.

Reporting Suspected Violations

We are committed to reporting any suspected violation of Abbott’s policies related to unfair competition. We can do so through OEC, Legal, or Speak Up.

[1] Welcome

1 minute

[2] Introduction to Antitrust

2 minutes

[3] Laws and Regulations

4 minutes

[4] The Impact on Our Business and Our Responsibilities

5 minutes

[5] Your Commitment

1 minute

[6] Knowledge Check

3 minutes

Learning Progress

This Topic is now available.

Abbott’s global standards on fair competition are consistent with our commitment to conduct business with honesty, fairness, and integrity.

They outline at a high-level Abbott’s commitment to comply with the competition laws in every country in which we do business.

Governments around the world have pursued actions against competitors who have colluded to limit competition.

The penalties for anti-competitive behavior have increased significantly over recent years.

Besides civil and criminal penalties, there are other consequences.

Since anti-competitive conduct usually results in higher prices or reduced selection for consumers, a company that commits such crimes risks seriously damaging its reputation in the eyes of its customers.

As an Abbott employee, it is important for you to know and follow the laws and regulations that govern competition in the countries and regions in which you operate.

An employee who commits anti-competitive acts is violating company policies and can face disciplinary action, including termination.

When facing a difficult decision, always take time to think things through.

• Think about what laws, policies, and procedures might be compromised.
• Think about the risks to you and the company.
• Think about what effect your decision will have on others.
• But, most of all, think about your options. Because you always have options.

Remember, no matter what happens, if you make the right choice, Abbott will be there to support you.

Remember, any conversation between competitors regarding pricing, markets, customers, suppliers, distributors, etc. could potentially be viewed as an illegal collaboration and should be avoided.

Discussions around Pricing

Any conversation between competitors regarding pricing, such as price differentials, list prices, or free services, could be viewed as illegal collaboration and should be avoided. These conversations do not have to result in a formal agreement with a competitor to be considered anti-competitive.

Discussions around Public Tenders

Any discussion between competitors regarding public tenders, bids, and Requests for Proposals (RFPs) could be viewed as illegal collaboration and should be avoided. These conversations do not have to result in a formal agreement with a competitor to be considered anti-competitive.

Discussions around Market or Customer Allocation

Any discussion between competitors around market or customer allocation could be viewed as illegal collaboration and should be avoided. These conversations do not have to result in a formal agreement with a competitor to be considered anti-competitive.

Discussions around Group Boycotts

Any discussion that takes place between competitors with respect to boycotting third parties such as suppliers, distributors or retailers could be viewed as illegal collaboration and should be avoided. These conversations do not have to result in a formal agreement with a competitor to be considered anti-competitive.

Discussions around Limiting or Controlling Production or Sales Volume

Any discussion with competitors around limiting or controlling production or sales volumes could be viewed as illegal collaboration and should be avoided. These conversations do not have to result in a formal agreement with a competitor to be considered anti-competitive.

Third Parties and Intermediaries

When communicating with third party suppliers and distributors, it is important for you to be alert to any arrangements that might be construed as limiting competition.

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Review

Take a moment to review some of the key concepts in this section.

Your Responsibilities

As an Abbott employee it is important for you to know and follow the laws and regulations that govern competition in the countries and regions in which you operate.

Knowing What Constitutes Anti-competitive Behavior

Any conversation between competitors regarding pricing, markets, customers, suppliers, distributors, etc. could potentially be viewed as an illegal collaboration and should be avoided.

Thinking Things Through

When facing a difficult decision, always take time to think about:

• What laws, policies, and procedures might be compromised.
• The risks to you and the company.
• The effect your decision will have on others.
• Your options.

[1] Welcome

1 minute

[2] Introduction to Antitrust

2 minutes

[3] Laws and Regulations

4 minutes

[4] The Impact on Our Business and Our Responsibilities

5 minutes

[5] Your Commitment

1 minute

[6] Knowledge Check

3 minutes

Learning Progress

This Topic is now available.

Take a moment to confirm your agreement with both statements.

I know and understand Abbott’s standards on Interactions with Competitors and how they relate to the environment in which Abbott operates.

I understand that I must comply with Abbott’s standards on Interactions with Competitors, which can be found in Abbott’s Code of Business Conduct and Ethics and Compliance Global Policy on Business Standards.

Confirm

The Knowledge Check that follows consists of 5 questions. You must score 80% or higher to successfully complete this course.

WHEN YOU ARE READY, CLICK THE KNOWLEDGE CHECK BUTTON.

[1] You are responsible for the manufacturing of reagents in the United States. During a conference, you and a few of your counterparts at competitors have an “off-the-record” discussion about one of your suppliers. Although no formal agreement is reached, a number of these counterparts indicate they will no longer be using a particular supplier because this supplier has near monopoly power and is using its dominant position to raise prices. Could your participation in the discussion be considered anti-competitive?

[1] No, the concerns raised are valid. In fact, the supplier’s dominant position in the marketplace is anti-competitive.

[2] No, as long as there is no written agreement among the parties.

[3] Yes. Any discussion with respect to boycotting third parties could be viewed as anti-competitive.

[4] Yes, but only if you sign an agreement to boycott the supplier with the other parties.

Next

Question 1: Feedback

Any discussion that takes place between competitors with respect to boycotting third parties such as suppliers, distributors, or retailers could be viewed as anti-competitive by government authorities.

[2] How should you end your participation in a meeting or conversation with a competitor that begins to veer towards a pricing discussion or some other prohibited topic?

[1] Calmly and respectfully.

[2] Loudly and dramatically and request that your objection be documented in meeting minutes, if applicable.

[3] Quickly and quietly.

Next

Question 2: Feedback

You should always end your participation in a meeting or conversation that begins to veer towards a pricing discussion or some other prohibited topic loudly and dramatically, so others remember your departure from the prohibited discussion.

[3] You recently attended a dinner with competitors at which product pricing and upcoming bids were discussed. In this case what should you do? Check the correct answer.

[1] Call the competitors that were present at the dinner to discuss your understanding of the event.

[2] Do nothing, since you didn’t sign any document that could be interpreted as anti-competitive.

[3] Write an email to all the dinner participants detailing the discussions that occurred at dinner and stating that you did not agree with any anti-competitive practices, so your position is documented.

[4] Contact your manager and OEC as soon as possible.

Next

Question 3: Feedback

You should always end your participation in a meeting or conversation that begins to veer towards a pricing discussion or some other prohibited topic loudly and dramatically, so others remember your departure from the prohibited discussion. Report the issue to your manager, OEC, Legal, or call SpeakUp.

[4] Three distributors meet to discuss an upcoming series of tenders at a local public hospital and agree to take turns winning the contracts by intentionally manipulating the prices presented at each bid.

[1] The scenario describes an unfair and illegal competition practice known as “bid-rigging.”

[2] There are no issues with the presented scenario. Because each company won a contract, no harm was done.

[3] The described issue is a legitimate agreement and is not illegal.

Next

Question 4: Feedback

Bid rigging is a serious offense with real-world consequences. Agreements on price or tenders are strictly prohibited.

[5] You are responsible for overseeing the sales and marketing team for Abbott Nutrition in the US. A competitor hires your top performing sales representative. You call your counterpart at the competitor and suggest that the two companies agree to stop poaching each other’s employees. Could this discussion be considered anti-competitive?

[1] Yes, the two companies compete to hire employees and an agreement between two employers to limit this competition may be viewed as anti-competitive.

[2] No, because employees of the two companies are subject to non-compete provisions in their respective employee agreements.

[3] No, because the arrangement has no effect on the price paid by consumers.

Next

Question 5: Feedback

Agreeing with another company to restrict competition in the labor market is considered in many jurisdictions unlawful, just like price fixing or similar agreements impacting the products we sell.

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Where to Get Help

Manager

If you have questions about your interactions with those outside of Abbott, the best place to start is with your manager.

Written Standards

• For our company’s fundamental set of expectations about interactions with others, consult our Code of Business Conduct.
• Consult Abbott’s Ethics and Compliance Global Policy on Business Standards for further guidance on Abbott’s requirements.
• Click here to access the Standards on the OEC website on Abbott World.

OFFICE OF ETHICS AND COMPLIANCE (OEC)

• The OEC is a global resource available to address your questions or concerns about interactions with competitors.
• Visit the Contact OEC page on the OEC website on Abbott World.
• If you have any concerns about anti-competitive business activities, either within the company or in your dealings with competitors or other third parties, you can report your concerns to the OEC (investigations@abbott.com),Legal, or by visiting Speak Up, which is available globally, 24/7 in multiple languages.

Legal Division

Contact the Legal Division with questions or concerns about competition law issues.

• Click here to access the Legal home page on Abbott World.

Course Resources

Transcript

Click here for a full transcript of the course

Welcome

Interactions with Competitors

Our Philosophy

Objectives

Table of Contents

Introduction to Antitrust

Our Business Interactions

The Importance of Antitrust

Quick Check

Table of Contents

Laws and Regulations

The Laws and Abbott’s Standards

Quick Check

Review

Table of Contents

The Impact on Our Business and Our Responsibilities

Abbott’s Expectations

You Always Have Options

Knowing What To Do

Review

Table of Contents

Your Commitment

Your Commitment

Knowledge Check

Introduction

Assessment

Feedback

Survey

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Course Description: At Abbott we are committed to fair dealing and complying with competition laws. In this course, we will help you understand and recognize anti-competitive behavior and how to promote fair competition and avoid anti-competitive practices. This course will take approximately 15 minutes to complete.

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