China National Chemical Corporation, a Corporation; ADAMA Agricultural Solutions Ltd., a Corporation; and Makhteshim Agan of North America, Inc., Doing Business as ADAMA, a Corporation; Analysis To Aid Public Comment, 17260-17263 [2017-07069]

Download as PDF 17260 Federal Register / Vol. 82, No. 67 / Monday, April 10, 2017 / Notices The registrants listed in Table 2 of Unit II have not requested that EPA waive the 180-day comment period. Accordingly, EPA will provide a 180day comment period on the proposed requests. Dated: March 2, 2017. Delores Barber, Director, Information Technology and Resources Management Division, Office of Pesticide Programs. Board of Governors of the Federal Reserve System, April 5, 2017. Yao-Chin Chao, Assistant Secretary of the Board. [FR Doc. 2017–07136 Filed 4–7–17; 8:45 am] 2. The EPA Administrator determines that continued use of the pesticide would pose an unreasonable adverse effect on the environment. BILLING CODE 6210–01–P BILLING CODE 6560–50–P FEDERAL RESERVE SYSTEM FEDERAL RESERVE SYSTEM IV. Procedures for Withdrawal of Request Formations of, Acquisitions by, and Mergers of Bank Holding Companies Registrants who choose to withdraw a request for product cancellation should submit the withdrawal in writing to the person listed under FOR FURTHER INFORMATION CONTACT. If the products have been subject to a previous cancellation action, the effective date of cancellation and all other provisions of any earlier cancellation action are controlling. The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.) (BHC Act), Regulation Y (12 CFR part 225), and all other applicable statutes and regulations to become a bank holding company and/or to acquire the assets or the ownership of, control of, or the power to vote shares of a bank or bank holding company and all of the banks and nonbanking companies owned by the bank holding company, including the companies listed below. The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The applications will also be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States. Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than May 3, 2017. A. Federal Reserve Bank of Atlanta (Chapelle Davis, Assistant Vice President) 1000 Peachtree Street NE., Atlanta, Georgia 30309. Comments can also be sent electronically to Applications.Comments@atl.frb.org: 1. FNBMD Bancshares, Inc., to become a bank holding company by acquiring 100 percent of the outstanding shares of The First National Bank of Mount Dora, both of Mount Dora, Florida. 2. IBERIABANK Corporation, Lafayette, Louisiana; to acquire 100 percent of the outstanding voting shares of Sabadell United Bank, N.A., Miami, Florida. asabaliauskas on DSK3SPTVN1PROD with NOTICES V. Provisions for Disposition of Existing Stocks Existing stocks are those stocks of registered pesticide products that are currently in the United States and that were packaged, labeled, and released for shipment prior to the effective date of the cancellation action. If the requests for voluntary cancellation are granted, the Agency intends to publish the cancellation order in the Federal Register. In any order issued in response to these requests for cancellation of product registrations EPA proposes to include the following provisions for the treatment of any existing stocks of the products listed in Table 1 of Unit II. For voluntary product cancellations, registrants will be permitted to sell and distribute existing stocks of voluntarily canceled products for 1 year after the effective date of the cancellation, which will be the date of publication of the cancellation order in the Federal Register. Thereafter, registrants will be prohibited from selling or distributing the products identified in Table 1 of Unit II., except for export consistent with FIFRA section 17 (7 U.S.C. 136o) or for proper disposal. Persons other than registrants will generally be allowed to sell, distribute, or use existing stocks until such stocks are exhausted, provided that such sale, distribution, or use is consistent with the terms of the previously approved labeling on, or that accompanied, the canceled products. Authority: 7 U.S.C. 136 et seq. VerDate Sep<11>2014 20:02 Apr 07, 2017 Jkt 241001 [FR Doc. 2017–07110 Filed 4–7–17; 8:45 am] PO 00000 Frm 00083 Fmt 4703 Sfmt 4703 Change in Bank Control Notices; Acquisitions of Shares of a Bank or Bank Holding Company The notificants listed below have applied under the Change in Bank Control Act (12 U.S.C. 1817(j)) and § 225.41 of the Board’s Regulation Y (12 CFR 225.41) to acquire shares of a bank or bank holding company. The factors that are considered in acting on the notices are set forth in paragraph 7 of the Act (12 U.S.C. 1817(j)(7)). The notices are available for immediate inspection at the Federal Reserve Bank indicated. The notices also will be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing to the Reserve Bank indicated for that notice or to the offices of the Board of Governors. Comments must be received not later than April 24, 2017. A. Federal Reserve Bank of Kansas City (Dennis Denney, Assistant Vice President) 1 Memorial Drive, Kansas City, Missouri 64198–0001: 1. Glenn Wiese, Mary Ellen Wiese, and Jerry Wiese, all of Lindsay, Nebraska; as members of the Wiese Family Group, to retain voting shares of Lindsay State Company, parent of Bank of Lindsay, both of Lindsay, Nebraska. Board of Governors of the Federal Reserve System, April 5, 2017. Yao-Chin Chao, Assistant Secretary of the Board. [FR Doc. 2017–07111 Filed 4–7–17; 8:45 am] BILLING CODE 6210–01–P FEDERAL TRADE COMMISSION [File No. 161 0093; Docket No. C–4610] China National Chemical Corporation, a Corporation; ADAMA Agricultural Solutions Ltd., a Corporation; and Makhteshim Agan of North America, Inc., Doing Business as ADAMA, a Corporation; Analysis To Aid Public Comment Federal Trade Commission. Proposed consent agreement. AGENCY: ACTION: The consent agreement in this matter settles alleged violations of SUMMARY: E:\FR\FM\10APN1.SGM 10APN1 asabaliauskas on DSK3SPTVN1PROD with NOTICES Federal Register / Vol. 82, No. 67 / Monday, April 10, 2017 / Notices federal law prohibiting unfair methods of competition. The attached Analysis to Aid Public Comment describes both the allegations in the 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 May 4, 2017. ADDRESSES: Interested parties may file a comment at https:// ftcpublic.commentworks.com/ftc/ chemchinaconsent online or on paper, by following the instructions in the Request for Comment part of the SUPPLEMENTARY INFORMATION section below. Write ‘‘In the Matter of China National Chemical Corporation and Syngenta AG, File No. 161 0093’’ on your comment and file your comment online at https:// ftcpublic.commentworks.com/ftc/ chemchinaconsent by following the instructions on the web-based form. If you prefer to file your comment on paper, write ‘‘In the Matter of China National Chemical Corporation and Syngenta AG, File No. 161 0093’’ on your comment and on the envelope, and mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC– 5610 (Annex D), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 20024. FOR FURTHER INFORMATION CONTACT: David Morris (202–326–3156), 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 consent agreement containing consent orders 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 April 4, 2017), on the World Wide Web, at https://www.ftc.gov/ os/actions.shtm. You can file a comment online or on paper. For the Commission to consider your comment, we must receive it on or before May 4, 2017. Write ‘‘In the Matter VerDate Sep<11>2014 20:02 Apr 07, 2017 Jkt 241001 of China National Chemical Corporation and Syngenta AG. File No. 161 0093’’ on your comment. Your comment— including your name and your state— will be placed on the public record of this proceeding, including, to the extent practicable, on the public Commission Web site, at https://www.ftc.gov/policy/ public-comments. 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 ‘‘[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. 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/ chemchinaconsent by following the instructions on the web-based form. If this Notice appears at https:// 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). PO 00000 Frm 00084 Fmt 4703 Sfmt 4703 17261 www.regulations.gov/#!home, you also may file a comment through that Web site. If you file your comment on paper, write ‘‘In the Matter of China National Chemical Corporation and Syngenta AG, File No. 161 0093’’ on your comment and on the envelope, and mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC–5610 (Annex D), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC. If possible, submit your paper comment to the Commission by courier or overnight service. Visit the Commission Web site at https://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 May 4, 2017. You can find more information, including routine uses permitted by the Privacy Act, in the Commission’s privacy policy, at https:// www.ftc.gov/ftc/privacy.htm. Analysis of Agreement Containing Consent Orders To Aid Public Comment I. Introduction The Federal Trade Commission (‘‘Commission’’) has accepted from China National Chemical Corporation (‘‘ChemChina’’), subject to final approval, an Agreement Containing Consent Orders (‘‘Consent Agreement’’). The Consent Agreement, which contains a proposed Decision and Order (‘‘Order’’) and Order to Maintain Assets, is designed to remedy the anticompetitive effects resulting from ChemChina’s proposed acquisition of Syngenta AG (‘‘Syngenta’’). Pursuant to an agreement signed on February 2, 2016 (the ‘‘Agreement’’), ChemChina, through an indirect subsidiary, will submit a public tender offer for all publicly registered shares and American Depository Shares of Syngenta at an offer price of $465 per share, for total consideration of up to $43 billion in cash (the ‘‘Acquisition’’). The proposed Acquisition would result in highly concentrated markets and raise significant competitive concerns in the markets for the herbicide paraquat, the insecticide abamectin, and the fungicide chlorothalonil in the United E:\FR\FM\10APN1.SGM 10APN1 17262 Federal Register / Vol. 82, No. 67 / Monday, April 10, 2017 / Notices States. The Commission’s Complaint alleges that the proposed Acquisition, if consummated, would violate 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, by lessening competition in the markets for formulated crop protection products based on paraquat, abamectin, and chlorothalonil in the United States. The Consent Agreement remedies the alleged violation by replacing the competition in the three relevant markets that would be lost as a result of the proposed Acquisition. Under the terms of the Consent Agreement, ChemChina subsidiary ADAMA will divest its paraquat, abamectin, and chlorothalonil crop protection businesses in the United States to American Vanguard Corporation and its affiliate Amvac Chemical Corporation (collectively ‘‘AMVAC’’). The Consent Agreement and proposed Order have been placed on the public record for 30 days to solicit comments from interested persons. Comments received during this period will become part of the public record. After 30 days, the Commission will review the Consent Agreement and the comments received, and decide whether it should withdraw, modify, or make final the Consent Agreement and proposed Order. asabaliauskas on DSK3SPTVN1PROD with NOTICES II. The Parties ChemChina is a Chinese state-owned entity and is a diversified chemical company headquartered in Haidian District Beijing, China. ChemChina owns an Israel-based crop protection company, ADAMA. This wholly-owned subsidiary produces and/or sells formulated crop protection products based on paraquat, abamectin, and chlorothalonil. Headquartered in Basel, Switzerland, Syngenta is a large research-based global agriculture company that manufactures and sells numerous crop protection products including paraquat, abamectin, and chlorothalonil. III. Crop Protection Formulations The relevant lines of commerce in which to analyze the effects of the proposed Acquisition are crop protection formulations based on the active ingredients paraquat, abamectin, and chlorothalonil. Crop protection formulations are used to protect crops from pests. These formulations are based on key active ingredients, which are diluted from a concentrated technical grade. Crop protection chemicals fall into three broad categories: (1) Herbicides, which control for weeds and other vegetation; (2) VerDate Sep<11>2014 20:02 Apr 07, 2017 Jkt 241001 fungicides, which control fungus; and (3) insecticides, which control insects. Of the relevant lines of commerce, paraquat is a herbicide, abamectin is an insecticide, and chlorothalonil is a fungicide. Paraquat is a non-selective ‘‘burndown’’ herbicide, which means it does not discriminate between weeds and crops. It is used to clear fields prior to the growing season. The use of paraquat has increased in recent years due to the resistance issues faced by glyphosate caused by its overuse. Other paraquat alternatives that do not have glyphosate’s resistance issues are significantly more expensive than paraquat. Abamectin is an insecticide used to kill mites, psyllid, and leafminers. It is used primarily in citrus and tree nut crops. Other alternative miticides are either significantly more expensive than abamectin because they are still on patent, or are less effective than abamectin. Due to resistance issues faced by insecticides, it is typical for a grower to spray five to six different types of miticides per season. Abamectin generally appears in any insecticide rotation because it is inexpensive and highly effective. Chlorothalonil is a broad spectrum fungicide used primarily to protect peanuts and potatoes. Chlorothalonil is particularly effective because it operates with four modes of action and is critical to growers for resistance management. Syngenta recommends that growers rotate or mix chlorothalonil with systemic fungicides to prevent or slow development of resistance to single-site mode of action fungicides. The relevant geographic area in which to analyze the effects of the Acquisition on the formulated crop protection markets is the United States. The Environmental Protection Agency requires that manufacturers register both the technical active ingredient and the formulated products for sales in the United States under the Federal Insecticide, Fungicide, and Rodenticide Act. This registration requirement limits market access to a set of products that meet U.S. regulatory requirements. Each of the products at issue were either developed or acquired by a Syngenta predecessor company, meaning that Syngenta offers the branded version of the product and has significant market shares in each. ADAMA is either the first or second largest generic supplier for each of these products. For paraquat, ADAMA is currently the second largest supplier behind Syngenta and another generic supplier. Post-Acquisition, the combined share of the two firms would PO 00000 Frm 00085 Fmt 4703 Sfmt 4703 be over 60%. ADAMA is the generic market leader for abamectin and has been for some time. Post-Acquisition, the combined share of the two firms would be close to 80%. Finally, ADAMA is the second largest generic supplier of chlorothalonil and postAcquisition the combined share of the two firms would be over 40%. There are a number of other generic providers of crop protection products generally, as well as other generic providers of paraquat, abamectin, and chlorothalonil. However, they have been largely unable to gain sufficient share to rival the scale and market position ADAMA holds in the markets for these three products. The proposed Acquisition removes significant competition between Syngenta and ADAMA. Though branded and generic companies employ different business models, the available evidence shows meaningful competition between the merging parties. Syngenta, for example, has lowered the price of its crop protection products in response to competitive pressure from ADAMA. Entry will not be sufficient to deter or counteract the anticompetitive effects of the proposed Acquisition. While generic entry may be likely and occur in a timely manner, it is unlikely to be sufficient to replace the competitive significance and scale of ADAMA. Typically, new entrants forecast and ultimately achieve minimal market penetration while ADAMA, in contrast, has successfully maintained significantly higher market shares for an extended period of time. ADAMA has been a more robust competitor for the products at issue through economies of scale and more favorable supply agreements. IV. The Consent Agreement The Consent Agreement eliminates the competitive concerns raised by ChemChina’s proposed acquisition of Syngenta by requiring ChemChina to sell ADAMA’s U.S. paraquat, abamectin, and chlorothalonil crop protection businesses. The Consent Agreement requires ChemChina to sell the relevant business assets to AMVAC, or another acquirer approved by the Commission through a purchase agreement approved by the Commission. AMVAC is well positioned to replace the competition that will be eliminated as a result of the proposed Acquisition. It has the industry experience, reputation, and resources to replace ADAMA as an effective competitor in the U.S. markets for formulated crop protection products based on paraquat, abamectin, and chlorothalonil. The company is headquartered in Newport Beach, California, and has four separate E:\FR\FM\10APN1.SGM 10APN1 Federal Register / Vol. 82, No. 67 / Monday, April 10, 2017 / Notices asabaliauskas on DSK3SPTVN1PROD with NOTICES manufacturing facilities within the U.S. AMVAC is an experienced player in the agrochemical segments in which ADAMA and Syngenta operate, and sells to the same customer base. AMVAC currently manufactures and formulates a large number of crop protection chemicals including herbicides, insecticides, and fungicides. The products to be divested will complement its current product lines. Finally, due to its wide spectrum of crop protection products, AMVAC is well placed to develop, register, and market new combination products, further improving scale in both crop protection and turf and ornamental applications. Pursuant to the Consent Agreement, AMVAC (or another approved acquirer) would acquire all of the assets and other such rights necessary to be an effective competitor for paraquat-, abamectin-, and chlorothalonil-based crop protection formulations. This will include the U.S. product registrations and registration data packages for both the formulated products and the technical active ingredients, all intellectual property rights associated with the products including confidential statements of formulation, and inventories. The divesture also will include a cost-competitive transitional supply agreement for the supply of paraquat with Sanonda, ADAMA’s low cost paraquat supplier, which is majority-owned by ChemChina, and a transitional services agreement with ADAMA. In addition, the Consent Agreement requires the removal of crop protection products containing any one of the three active ingredients from Syngenta’s loyalty program for three years. This nurturing provision is to help ensure that AMVAC (or any approved acquirer) can step into the shoes of ADAMA and ultimately retain its competitiveness and scale. The purpose of this analysis is to facilitate public comment on the Consent Agreement. It is not intended to constitute an official interpretation of the proposed Order or to modify its terms in any way. By direction of the Commission. Donald S. Clark, Secretary. [FR Doc. 2017–07069 Filed 4–7–17; 8:45 am] BILLING CODE 6750–01–P VerDate Sep<11>2014 20:02 Apr 07, 2017 Jkt 241001 FEDERAL TRADE COMMISSION [File No. 151 0159] American Guild of Organists; Analysis To Aid Public Comment Federal Trade Commission. Proposed consent agreement. AGENCY: ACTION: The consent agreement in this matter settles alleged violations of federal law prohibiting unfair methods of competition. The attached Analysis to Aid Public Comment describes both the allegations in the 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 May 2, 2017. ADDRESSES: Interested parties may file a comment at https:// ftcpublic.commentworks.com/ftc/ americanguildconsent online or on paper, by following the instructions in the Request for Comment part of the SUPPLEMENTARY INFORMATION section below. Write ‘‘In the Matter of American Guild of Organists; File No. 151–0159’’ on your comment and file your comment online at https:// ftcpublic.commentworks.com/ftc/ americanguildconsent by following the instructions on the web-based form. If you prefer to file your comment on paper, write ‘‘In the Matter of American Guild of Organists; File No. 151–0159’’ on your comment and on the envelope, and mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC– 5610 (Annex D), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 20024. FOR FURTHER INFORMATION CONTACT: Karen A. Mills (202–326–2052), 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 consent agreement containing consent orders 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 SUMMARY: PO 00000 Frm 00086 Fmt 4703 Sfmt 4703 17263 full text of the consent agreement package can be obtained from the FTC Home Page (for March 31, 2017), on the World Wide Web, at https://www.ftc.gov/ os/actions.shtm. You can file a comment online or on paper. For the Commission to consider your comment, we must receive it on or before May 2, 2017. Write ‘‘In the Matter of American Guild of Organists; File No. 151–0159’’ on your comment. Your comment—including your name and your state—will be placed on the public record of this proceeding, including, to the extent practicable, on the public Commission Web site, at https:// www.ftc.gov/policy/public-comments. 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 ‘‘[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. Postal mail addressed to the Commission is subject to delay due to heightened security screening. As a 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). E:\FR\FM\10APN1.SGM 10APN1

Agencies

[Federal Register Volume 82, Number 67 (Monday, April 10, 2017)]
[Notices]
[Pages 17260-17263]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-07069]


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FEDERAL TRADE COMMISSION

[File No. 161 0093; Docket No. C-4610]


China National Chemical Corporation, a Corporation; ADAMA 
Agricultural Solutions Ltd., a Corporation; and Makhteshim Agan of 
North America, Inc., Doing Business as ADAMA, a Corporation; Analysis 
To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

-----------------------------------------------------------------------

SUMMARY: The consent agreement in this matter settles alleged 
violations of

[[Page 17261]]

federal law prohibiting unfair methods of competition. The attached 
Analysis to Aid Public Comment describes both the allegations in the 
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 May 4, 2017.

ADDRESSES: Interested parties may file a comment at https://ftcpublic.commentworks.com/ftc/chemchinaconsent online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``In the Matter of China 
National Chemical Corporation and Syngenta AG, File No. 161 0093'' on 
your comment and file your comment online at https://ftcpublic.commentworks.com/ftc/chemchinaconsent by following the 
instructions on the web-based form. If you prefer to file your comment 
on paper, write ``In the Matter of China National Chemical Corporation 
and Syngenta AG, File No. 161 0093'' on your comment and on the 
envelope, and mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite 
CC-5610 (Annex D), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: David Morris (202-326-3156), 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 consent agreement 
containing consent orders 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 April 4, 2017), on the World Wide Web, at 
https://www.ftc.gov/os/actions.shtm.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before May 4, 2017. 
Write ``In the Matter of China National Chemical Corporation and 
Syngenta AG. File No. 161 0093'' on your comment. Your comment--
including your name and your state--will be placed on the public record 
of this proceeding, including, to the extent practicable, on the public 
Commission Web site, at https://www.ftc.gov/policy/public-comments. 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 ``[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.
---------------------------------------------------------------------------

    \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).
---------------------------------------------------------------------------

    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/chemchinaconsent by following the instructions on the web-based 
form. If this Notice appears at https://www.regulations.gov/#!home, you 
also may file a comment through that Web site.
    If you file your comment on paper, write ``In the Matter of China 
National Chemical Corporation and Syngenta AG, File No. 161 0093'' on 
your comment and on the envelope, and mail your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
600 Pennsylvania Avenue NW., Suite CC-5610 (Annex D), Washington, DC 
20580, or deliver your comment to the following address: Federal Trade 
Commission, Office of the Secretary, Constitution Center, 400 7th 
Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC. If 
possible, submit your paper comment to the Commission by courier or 
overnight service.
    Visit the Commission Web site at https://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 May 4, 2017. You can find more information, 
including routine uses permitted by the Privacy Act, in the 
Commission's privacy policy, at https://www.ftc.gov/ftc/privacy.htm.

Analysis of Agreement Containing Consent Orders To Aid Public Comment

I. Introduction

    The Federal Trade Commission (``Commission'') has accepted from 
China National Chemical Corporation (``ChemChina''), subject to final 
approval, an Agreement Containing Consent Orders (``Consent 
Agreement''). The Consent Agreement, which contains a proposed Decision 
and Order (``Order'') and Order to Maintain Assets, is designed to 
remedy the anticompetitive effects resulting from ChemChina's proposed 
acquisition of Syngenta AG (``Syngenta'').
    Pursuant to an agreement signed on February 2, 2016 (the 
``Agreement''), ChemChina, through an indirect subsidiary, will submit 
a public tender offer for all publicly registered shares and American 
Depository Shares of Syngenta at an offer price of $465 per share, for 
total consideration of up to $43 billion in cash (the ``Acquisition''). 
The proposed Acquisition would result in highly concentrated markets 
and raise significant competitive concerns in the markets for the 
herbicide paraquat, the insecticide abamectin, and the fungicide 
chlorothalonil in the United

[[Page 17262]]

States. The Commission's Complaint alleges that the proposed 
Acquisition, if consummated, would violate 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, by lessening competition in 
the markets for formulated crop protection products based on paraquat, 
abamectin, and chlorothalonil in the United States.
    The Consent Agreement remedies the alleged violation by replacing 
the competition in the three relevant markets that would be lost as a 
result of the proposed Acquisition. Under the terms of the Consent 
Agreement, ChemChina subsidiary ADAMA will divest its paraquat, 
abamectin, and chlorothalonil crop protection businesses in the United 
States to American Vanguard Corporation and its affiliate Amvac 
Chemical Corporation (collectively ``AMVAC'').
    The Consent Agreement and proposed Order have been placed on the 
public record for 30 days to solicit comments from interested persons. 
Comments received during this period will become part of the public 
record. After 30 days, the Commission will review the Consent Agreement 
and the comments received, and decide whether it should withdraw, 
modify, or make final the Consent Agreement and proposed Order.

II. The Parties

    ChemChina is a Chinese state-owned entity and is a diversified 
chemical company headquartered in Haidian District Beijing, China. 
ChemChina owns an Israel-based crop protection company, ADAMA. This 
wholly-owned subsidiary produces and/or sells formulated crop 
protection products based on paraquat, abamectin, and chlorothalonil.
    Headquartered in Basel, Switzerland, Syngenta is a large research-
based global agriculture company that manufactures and sells numerous 
crop protection products including paraquat, abamectin, and 
chlorothalonil.

III. Crop Protection Formulations

    The relevant lines of commerce in which to analyze the effects of 
the proposed Acquisition are crop protection formulations based on the 
active ingredients paraquat, abamectin, and chlorothalonil. Crop 
protection formulations are used to protect crops from pests. These 
formulations are based on key active ingredients, which are diluted 
from a concentrated technical grade. Crop protection chemicals fall 
into three broad categories: (1) Herbicides, which control for weeds 
and other vegetation; (2) fungicides, which control fungus; and (3) 
insecticides, which control insects. Of the relevant lines of commerce, 
paraquat is a herbicide, abamectin is an insecticide, and 
chlorothalonil is a fungicide.
    Paraquat is a non-selective ``burndown'' herbicide, which means it 
does not discriminate between weeds and crops. It is used to clear 
fields prior to the growing season. The use of paraquat has increased 
in recent years due to the resistance issues faced by glyphosate caused 
by its overuse. Other paraquat alternatives that do not have 
glyphosate's resistance issues are significantly more expensive than 
paraquat.
    Abamectin is an insecticide used to kill mites, psyllid, and 
leafminers. It is used primarily in citrus and tree nut crops. Other 
alternative miticides are either significantly more expensive than 
abamectin because they are still on patent, or are less effective than 
abamectin. Due to resistance issues faced by insecticides, it is 
typical for a grower to spray five to six different types of miticides 
per season. Abamectin generally appears in any insecticide rotation 
because it is inexpensive and highly effective.
    Chlorothalonil is a broad spectrum fungicide used primarily to 
protect peanuts and potatoes. Chlorothalonil is particularly effective 
because it operates with four modes of action and is critical to 
growers for resistance management. Syngenta recommends that growers 
rotate or mix chlorothalonil with systemic fungicides to prevent or 
slow development of resistance to single-site mode of action 
fungicides.
    The relevant geographic area in which to analyze the effects of the 
Acquisition on the formulated crop protection markets is the United 
States. The Environmental Protection Agency requires that manufacturers 
register both the technical active ingredient and the formulated 
products for sales in the United States under the Federal Insecticide, 
Fungicide, and Rodenticide Act. This registration requirement limits 
market access to a set of products that meet U.S. regulatory 
requirements.
    Each of the products at issue were either developed or acquired by 
a Syngenta predecessor company, meaning that Syngenta offers the 
branded version of the product and has significant market shares in 
each. ADAMA is either the first or second largest generic supplier for 
each of these products. For paraquat, ADAMA is currently the second 
largest supplier behind Syngenta and another generic supplier. Post-
Acquisition, the combined share of the two firms would be over 60%. 
ADAMA is the generic market leader for abamectin and has been for some 
time. Post-Acquisition, the combined share of the two firms would be 
close to 80%. Finally, ADAMA is the second largest generic supplier of 
chlorothalonil and post-Acquisition the combined share of the two firms 
would be over 40%. There are a number of other generic providers of 
crop protection products generally, as well as other generic providers 
of paraquat, abamectin, and chlorothalonil. However, they have been 
largely unable to gain sufficient share to rival the scale and market 
position ADAMA holds in the markets for these three products.
    The proposed Acquisition removes significant competition between 
Syngenta and ADAMA. Though branded and generic companies employ 
different business models, the available evidence shows meaningful 
competition between the merging parties. Syngenta, for example, has 
lowered the price of its crop protection products in response to 
competitive pressure from ADAMA.
    Entry will not be sufficient to deter or counteract the 
anticompetitive effects of the proposed Acquisition. While generic 
entry may be likely and occur in a timely manner, it is unlikely to be 
sufficient to replace the competitive significance and scale of ADAMA. 
Typically, new entrants forecast and ultimately achieve minimal market 
penetration while ADAMA, in contrast, has successfully maintained 
significantly higher market shares for an extended period of time. 
ADAMA has been a more robust competitor for the products at issue 
through economies of scale and more favorable supply agreements.

IV. The Consent Agreement

    The Consent Agreement eliminates the competitive concerns raised by 
ChemChina's proposed acquisition of Syngenta by requiring ChemChina to 
sell ADAMA's U.S. paraquat, abamectin, and chlorothalonil crop 
protection businesses. The Consent Agreement requires ChemChina to sell 
the relevant business assets to AMVAC, or another acquirer approved by 
the Commission through a purchase agreement approved by the Commission.
    AMVAC is well positioned to replace the competition that will be 
eliminated as a result of the proposed Acquisition. It has the industry 
experience, reputation, and resources to replace ADAMA as an effective 
competitor in the U.S. markets for formulated crop protection products 
based on paraquat, abamectin, and chlorothalonil. The company is 
headquartered in Newport Beach, California, and has four separate

[[Page 17263]]

manufacturing facilities within the U.S. AMVAC is an experienced player 
in the agrochemical segments in which ADAMA and Syngenta operate, and 
sells to the same customer base. AMVAC currently manufactures and 
formulates a large number of crop protection chemicals including 
herbicides, insecticides, and fungicides. The products to be divested 
will complement its current product lines. Finally, due to its wide 
spectrum of crop protection products, AMVAC is well placed to develop, 
register, and market new combination products, further improving scale 
in both crop protection and turf and ornamental applications.
    Pursuant to the Consent Agreement, AMVAC (or another approved 
acquirer) would acquire all of the assets and other such rights 
necessary to be an effective competitor for paraquat-, abamectin-, and 
chlorothalonil-based crop protection formulations. This will include 
the U.S. product registrations and registration data packages for both 
the formulated products and the technical active ingredients, all 
intellectual property rights associated with the products including 
confidential statements of formulation, and inventories. The divesture 
also will include a cost-competitive transitional supply agreement for 
the supply of paraquat with Sanonda, ADAMA's low cost paraquat 
supplier, which is majority-owned by ChemChina, and a transitional 
services agreement with ADAMA. In addition, the Consent Agreement 
requires the removal of crop protection products containing any one of 
the three active ingredients from Syngenta's loyalty program for three 
years. This nurturing provision is to help ensure that AMVAC (or any 
approved acquirer) can step into the shoes of ADAMA and ultimately 
retain its competitiveness and scale.
    The purpose of this analysis is to facilitate public comment on the 
Consent Agreement. It is not intended to constitute an official 
interpretation of the proposed Order or to modify its terms in any way.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 2017-07069 Filed 4-7-17; 8:45 am]
 BILLING CODE 6750-01-P
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