January 28, 2002 George Cary, Esq.
Dear Mr. Cary: On March 15, 2001, the Federal Trade Commission ("Commission") issued a Decision and Order ("Order") to remedy the effects on competition of the acquisition of Union Carbide Corporation by The Dow Chemical Company ("Dow"). The Order became final as to Dow on March 21, 2001. The Order requires, inter alia, Dow to divest assets and businesses relating to the research, development, manufacture, sale, and distribution of ethyleneamines to Huntsman International LLC ("Huntsman") pursuant to the Huntsman Agreement, which agreement is incorporated into and made a part of the Order. See Order ¶¶ II.B. and II.H. The Huntsman Agreement is defined by Order ¶ I.AQ., and includes all of the contracts between Dow and Huntsman that divest assets and businesses to Huntsman. One of the contracts incorporated into the Order is an agreement requiring Dow to supply Huntsman with up to 30 million pounds per year of ethyleneamines from a Dow plant in Terneuzen, The Netherlands ("Terneuzen Ethyleneamines Supply Agreement"). See Order ¶ I.AQ.9. A second contract incorporated into the Order is an agreement licensing Dow to use certain know-how and intellectual property conveyed to Huntsman by Dow to produce, market, and sell ethyleneamines at the Terneuzen plant ("Know-How Agreement"). See Order ¶ I.AQ.9. The Order also requires Dow to divest assets and businesses relating to the research, development, manufacture, sale, and distribution of ethanolamines to Ineos plc ("Ineos") pursuant to the Ineos Agreement. See Order ¶¶ III.B. and III.H. The Ineos Agreement is defined by Order ¶ I.AR., and includes all of the contracts between Dow and Ineos that divest assets and businesses to Ineos. One of the contracts incorporated into the Order is an agreement requiring Dow to supply Ineos with ethylene oxide from a Dow plant in Plaquemine, LA ("Plaquemine Ethylene Oxide Supply Agreement"). See Order ¶ I.AR.5. On December 5, 2001, Dow filed the Petition Of The Dow Chemical Company For Approval Of Certain Amendments To The Huntsman Agreement And The Ineos Agreement ("Petition") seeking the Commission's prior approval of modifications to the Terneuzen Ethyleneamines Supply Agreement ("Proposed Modified Terneuzen Ethyleneamines Supply Agreement"), to the Know-How Agreement ("Proposed Modified Know-How Agreement"), and to the Plaquemine Ethylene Oxide Supply Agreement ("Proposed Modified Plaquemine Ethylene Oxide Supply Agreement"). This letter responds to the Petition. Dow's Petition was placed on the public record to solicit public comment on December 5, 2001, for 30 days. No comments were received. The Commission has considered Dow's Petition, as well as other available information, and has determined to approve each of the requested modifications. Any failure by Respondents to comply with the Proposed Modified Terneuzen Ethyleneamines Supply Agreement, the Proposed Modified Know-How Agreement, and the Proposed Modified Plaquemine Ethylene Oxide Supply Agreement shall constitute a failure to comply with the Order. In making its determination, the Commission has relied upon the information submitted and the representations made by Dow. By direction of the Commission. Donald S. Clark |
