Conduct with Customers, Suppliers and Competitors
Tronox’s success depends on building good relationships with our customers and suppliers. Cultivating an atmosphere of trust and selling our products based on merit are fundamental to this goal.
Standard of Conduct
Avoid any conduct that violates, or might appear to violate, either the letter or spirit of an antitrust law.
All agents and distributors shall undergo appropriate background screening prior to doing business with the Company.
Do not enter into any agreement or understanding with any competitor regarding price.
Do not engage in or discuss with competitors or other business partners any prohibited activities that might be interpreted as an effort to improperly restrict or limit competition (such as pricing or sale terms).
We should all strive to deal fairly with Tronox’s customers, suppliers and competitors.
To that end, we must not take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair practice.
Unfair Competition – Antitrust
Antitrust laws are intended to protect the process of competition to maximize consumer benefit.
Nearly all countries in which Tronox operates have enacted such laws. Antitrust laws prohibit agreements among competitors to fix prices, restrict output, bid rig, allocate markets, or boycott customers or suppliers. As a general premise, you may not engage with our competitors in any manner that might be interpreted as an effort to improperly restrict or limit competition.
- Pricing—To compete effectively, we gather information about our competitors’ pricing and their actions in the marketplace. However, we may not obtain this information directly from competitors because the exchange of information may imply an intent to collude on pricing terms. We may gather competitive information only from legitimate sources, such as the business press, the internet, customers and consultants. Price-fixing schemes (i.e., agreements among competitors to raise, fix, or otherwise maintain the price of goods) are among the most serious violations of antitrust law and may be punishable by fines or imprisonment. Examples of illegal price fixing agreements with competitors include:
- Adopting a standard formula for computing prices;
- Adhering to a minimum fee or price schedule;
- Holding prices firm;
- Eliminating or reducing discounts; or
- Agreeing to reduce inventories or curtail output.
- Trade Associations and Trade Shows—The antitrust laws permit competitors to participate in trade associations and in trade shows provided any discussions do not result in agreements to impair competition. For trade association meetings, you are reminded to review the agenda in advance, and confirm that the discussions will be limited to legitimate missions of the organization. Avoid any inference that the trade association organizers are acting as conduits of information to competitors to restrain competition. Exercise caution in trade show settings to avoid the appearance of collaborating with competitors on sensitive information. Never comply with a competitor’s request to reveal non-public information such as customer pipeline, marketing strategies for products or customers, or new product development.
- Bid rigging—Whenever contracts are awarded by means of soliciting bids, any coordination among competitors may effectively raise prices and is unlawful. You must remain alert for the following situations, all of which are considered violations by antitrust regulators:
- Bid suppression—One or more competitors, who otherwise would be expected to bid agree to refrain from bidding so that the designated winning competitor’s bid will be accepted.
- Complementary bidding—Competitors agree to refrain from bidding or withdraw a previously submitted bid so that the designated winning competitor’s bid will be accepted.
- Bid rotation—All competitors submit bids but take turns being the lowest bidder.
- Subcontracting—Competitors who agree not to bid or to submit a losing bid may in turn receive subcontracts or supply contracts in exchange.
Be cautious about indicators of collusion and avoid loose language.
We must avoid careless language in our electronic communications, memoranda, notes and public statements which might suggest anticompetitive practices. The following are examples of phrases that may suggest an invitation to a competitor:
Don’t claim future Tronox price or output actions are contingent on specific competitor responses. For example, phrases such as “I do not want to undercut a competitor” should be avoided.
Don’t suggest competitors or the industry should behave “rationally” and “appropriately” or should stop behaving “illogically”. A phrase such as the “industry lacks discipline” may be taken out of context and should be avoided.
Don’t discuss what industry price or output, or a competitor’s price or output, should be. A statement such as “the price increase is taking hold” may create an inference of collusion.
Marketing: Disparagement of Competitors
Tronox’s advertising and marketing must comply with all applicable governmental laws, rules and regulations that prohibit unfair and deceptive trade practices.
This includes any advertising and sales promotion policies.
It is Tronox’s policy to emphasize the quality of its products or services; however, you must not make unfounded disparaging comments about competitors or their products or services. Statements (oral or written) made concerning a competitor or its products must be fair, factual and complete.
Are you responsible for any Tronox advertisement or marketing?
If so, it is important that you:
- Make sure the advertisement is truthful, not deceptive, and complies with all applicable laws, rules, regulations and policies
- Verify all claims regarding performance, quality, etc.
When communicating about a competitor or its products or services:
- Avoid comments about a competitor’s character or business practices (e.g., telling a customer that a competitor’s sales representative is immoral or untrustworthy). The primary emphasis should be on Tronox’s capabilities, know-how and the benefits of its products and services to its customer, rather than on a competitor’s deficiencies.
- Avoid references to a competitor’s non-product-related troubles or weak points (e.g., financial difficulties, pending lawsuits, government investigations).
- Statements about the specifications, quality, utility or value of a competitor’s products or services should not be made unless they are substantiated by the competitor’s current published information or other factual data with respect to the competitor’s current products. In some countries, such statements also might be required to relate positive aspects of the competitive product or services.
- Unsubstantiated claims that Tronox originated a product or services or one of its features should not be made.
We manufacture and market products that can be handled safely. Tronox products are tested to ensure quality and safety standards are met. Our products are accompanied by clear and relevant safety information and appropriate warnings and instructions regarding any hazard that our products may pose to persons, property, or the environment.
It is important to make sure that you do not authorize the shipment of any product known to be defective, unsafe, or unsuited for its intended use.
Offering Gifts, Entertainment, and/or Travel to Customers
Attempting to influence customer purchasing decisions is improper, unacceptable, and in some instances, unlawful.
For that reason, do not offer money, gifts, discounts, special favors or other items of value to customers or prospective customers that may be construed as an attempt to improperly influence their relationship to Tronox’s business interests.
There may be instances where local tradition calls for giving gifts on special occasions. If that is the case, small gifts of nominal value can be presented, as long as the cost for that gift is fully documented. It is also important to ensure that the gift is consistent with Tronox’s compliance programs and policies.
Examples of acceptable gifts you may give include: widely distributed specialty advertising items (i.e. clothing and desktop accessories with Tronox’s logo), tickets to local sports or cultural events, restaurant meals or tokens of goodwill with nominal market value.
Never give gifts of cash or cash equivalents, such as gift cards.
Accepting Gifts from Vendors and Suppliers
Business gifts of significant value offered to you may be intended to improperly influence the selection of vendors or suppliers. Therefore, Tronox’s standards governing the acceptance of gifts from vendors or supplier companies or their agents mirror those related to giving gifts to our customers and prospective customers.
Accepting Gifts, Entertainment, and/or Travel
Decisions about accepting gifts or entertainment from vendors or suppliers should be governed by local custom, discretion and good judgment.
As a general rule, business gifts may be accepted provided they are of nominal value and include no cash or financial securities. Tronox would regard a single item or collection of items in excess of US $150 as being beyond nominal value and to be reported to your supervisor or the Legal Department. In the case of meals, entertainment, lodgings or offers of travel, the decision to accept should be guided by the principle of reciprocity, that is, whether the individual who received such an offer is in a position to reciprocate in a similar fashion using Tronox’s normal expense account procedures.
When it comes to gifts and entertainment:
- Don’t give gifts that are excessive, improper, or even give the appearance of being improper.
- Don’t solicit gifts, entertainment, or favors of any kind from suppliers, customers, or competitors.
- Don’t accept unsolicited gifts worth more than US $150 (unless approved by your supervisor or the Legal Department).
If the gift involves a government or public official, it is crucial you comply with the information provided in the section on Anti-Bribery and Anti-Corruption.
Before accepting a gift, ask yourself:
- Is there an expectation to reciprocate in kind?
- Is the type of gift or invitation appropriate in a business relationship?
- Is the frequency you accept offers of entertainment excessive?
- Are you receiving a single item or collection of items valued in excess of US $150?
- Have you secured the approval of your supervisor or the Legal Department in advance?
If you have concerns whether a particular gift is permissible under this policy or if you need to request approval for any gift or entertainment not covered here, contact your manager or the Legal Department.