COVISINT, the global online exchange planned by some of the world’s automotive giants, could be ready for launch within a few months after being cleared by US regulators.
A review by the Federal Trade Commission found no reason to halt Covisint on fair competition grounds, despite the collective involvement of industry giants Ford, General Motors, DaimlerChrysler and Renault/Nissan.
The FTC had to determine whether the founders’ combined market leverage would allow them to unfairly control prices or competition among suppliers.
While ruling there were no grounds to act at present, the commission warned it could return to Covisint at any time if anti-competitive patterns were to emerge once it was operational.
The team developing Covisint hailed the decision as a ‘significant milestone’ for business-to-business e-commerce generally. The combined purchasing power of its founding partners alone will make it one of the biggest marketplaces on the internet.
Alice Miles, of the exchange’s executive planning team, said: ‘Covisint has always intended to operate in full compliance with the anti-trust laws. The FTC was able to verify that through a review of our business plan and extensive interviews with participants in the industry.’ The founding partners have made no secret of their frustration over the delay caused by the lengthy inquiry, which they claim has restricted their ability to react in the rapid fashion demanded by the web economy.
The exchange still needs the all-clear from a review currently underway in Bonn by theGerman competition regulator. But Covisint is understood to be ready to go within a month of getting the green light.
Major suppliers including Delphi Automotive, Dana Corporation, Plastech and BASF have pledged support for Covisint.