EC approves car giant marketplace
- Added:
- Jul 31, 2001
Covisint was launched by car retailing giants Ford, DaimlerChrysler, General Motors, Renault, Nissan and Peugot Citroen, as a way of supplying the car industry with procurement, supply and collaborative product development facilities.
The European Commission called the development in for investigation, not as a merger, but as one of its first explorations of the internet b2b sector, with industry members being invited to offer their own comments on the proposals. The commission notes in its report, issued today, that feedback within the industry had been favourable, with a large number of firms indicating they would use the site's services.
“B2B marketplaces such as Covisint are becoming very common,” the commission said. “They potentially have a major impact on the way that companies in certain industries do business, and are in general expected to have pro-competitive effects. They should create more transparency, thereby helping to link more operators and to integrate markets, and they may also create market efficiencies by reducing search and information costs and improving inventory management, leading ultimately to lower prices for the end consumer.”
The deal, featuring major industry players offering development services online to interested members of the vehicle world, seems to fit within the Commission's intended requirements of the b2b marketplace set out in March this year - that they do not sqeeze out small companies through the machinations of larger groups.
The Commission's report concluded: “The Commission has concluded that the notified agreements contain adequate provisions to eliminate these potential competition concerns, and has sent the parties a "comfort" letter to this effect.
“In particular, the agreements show that Covisint is open to all firms in the industry on a non-discriminatory basis, is based on open standards, allows both shareholders and other users to participate in other B2B exchanges, does not allow joint purchasing between car manufacturers or for automotive-specific products, and provides for adequate data protection, including firewalls and security rules."