Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

Saturday, September 1, 2007

If a Tree Falls and People Hear It, Does This Mean That There is an Antitrust Conspiracy?

Posted by D. Daniel Sokol

A new working paper by Jean-Daniel M. Saphores, Jeffrey R. Vincent, Valy Marochko, Ioan Vasile Abrudan, Laura Bouriaud, and Clifford Zinnes explores collusion in timber auctions.  The World Bank Policy Research Working Paper is titled Detecting Collusion in Timber Auctions: An Application to Romania.

ABSTRACT:  Romania was one of the first transition countries in Europe to introduce auctions for allocating standing timber (stumpage) in public forests. In comparison with the former system in the country - administrative allocation at set prices - timber auctions offer several potential advantages: greater revenue generation for the government, a higher probability that tracts will be allocated to the firms that value them most highly, and stronger incentives for technological change within industry and efficiency gains in the public sector. Competition is the key to realizing these advantages. Unfortunately, collusion among bidders often limits competition in timber auctions, including in well-established market economies such as the United States. The result is that tracts sell below their fair market value, which undermines the advantages of auctions. This paper examines the Romanian auction system, with a focus on the use of econometric methods to detect collusion. It begins by describing the historical development of the system and the principal steps in the auction process. It then discusses the qualitative impacts of various economic and institutional factors, including collusion, on winning bids in different regions of the country. This discussion draws on information from a combination of sources, including unstructured interviews conducted with government officials and company representatives during 2003. Next, the paper summarizes key findings from the broader research literature on auctions, with an emphasis on empirical studies that have developed econometric methods for detecting collusion. It then presents an application of such methods to timber auction data from two forest directorates in Romania, Neamt and Suceava. This application confirms that data from Romanian timber auctions can be used to determine the likelihood of collusion, and it suggests that collusion reduced winning bids in Suceava in 2002 and perhaps also in Neamt. The paper concludes with a discussion of actions that the government can take to reduce the incidence of collusion and minimize its impact on auction outcomes.

September 1, 2007 | Permalink | Comments (0) | TrackBack (0)

Friday, August 31, 2007

There is No Antitrust Conspiracy to Blame For Your High Gas Prices

Posted by D. Daniel Sokol

Yesterday the FTC and DOJ released the their Report On Spring/Summer 2006 Nationwide Gasoline Price Increases.  In what is perhaps a shock to nobody (except those in Congress), it turns out that prices are a function of supply and demand.  In particular the report lists six factors for the price increases:

(1) seasonal effects of the summer driving season; (2) increases in the price of crude oil; (3) increases in the price of ethanol; (4) capacity reductions stemming from refiners’ transition from the fuel additive methyl tertiary-butyl ether to ethanol; (5) refinery outages resulting from hurricane damage, other unexpected problems or external events, and required maintenance; and (6) increased consumer demand for gasoline beyond the seasonal effects of the summer driving season.  

August 31, 2007 | Permalink | Comments (0) | TrackBack (0)

European Commission Decisions on Competition: Landmark Antitrust and Merger Cases from an Economic Point of View

Posted by D. Daniel Sokol

A new book on EC Competition Law, European Commission Decisions on Competition: Landmark Antitrust and Merger Cases from an Economic Point of View, provides a comprehensive description and analysis of Commission decisions adopted pursuant to Articles 81, 82 and 86 EC Treaty, as well as landmark European merger cases.  Its authors are Maarten Pieter Schinkel (Amsterdam Center for Law and Economics), Martin Carree (Universiteit Maastricht), Francesco Russo (Amsterdam Center for Law and Economics), and Andrea Günster (Amsterdam Center for Law and Economics).

ABSTRACT: This book provides a comprehensive economic classification and analysis of all European Commission decisions adopted pursuant to Articles 81, 82 and 86 EC Treaty, as well as landmark European merger cases. The decisions are organized according to the principal economic theory applied in the case. For each theory, the first decision in which that theory was relied upon by the Commission - provided, if appealed, it was upheld by the European Courts - is described according to a fixed template that is applied throughout the book. All related decisions, in which the same economic issue was central, are listed chronologically. The book is offered as a compendium to the leading IO textbooks and practitioner guides, to which detailed references are made. All cases are structured to be easily accessible for scholars of IO and the economics of competition policy, as well as practicing competition lawyers and officials. Of each landmark decision discussed in the book, a PDF file of the full text of the publication as it appeared in the Official Journal of the European Communities is included on a complementary CD-ROM. This book provides a unique analysis of the Commission's application and understanding of results from antitrust economics that have influenced European competition law enforcement. The introduction to the book, together with the breadth of the materials selected, present a complete historical overview of European competition policy.

August 31, 2007 | Permalink | Comments (0) | TrackBack (0)

Thursday, August 30, 2007

August 24 Draft of Chinese Anti-Monopoly Law

Posted by D. Daniel Sokol

Over at our sister blog within the Law Blog network, China Law Prof Blog, there is a posting of the August 24 Draft of Chinese Anti-Monopoly Law.  You can download the Chinese and English law below.

Download 070824_draft_aml_third_draft.pdf

August 30, 2007 | Permalink | Comments (0) | TrackBack (0)

Taking Stock of the Antitrust Modernization Commission Report

Posted by D. Daniel Sokol

The Silicon Flatirons Program at the University of Colorado will be hosting a program on Taking Stock of the Antitrust Modernization Commission Report in lovely Boulder, CO on September 5.  The program looks good with a mix of AMC members, academics and practitioners.   From the conference press release:

This conference will evaluate the judgments of the Antitrust Modernization Commission report, examining its basic conclusion that there are no fundamental flaws in modern antitrust law and practice as well as its various suggestions for reform. To do so, we will bring together some of the Commissioners who evaluated the state of antitrust law, current and former antitrust enforcers, and a number of leading antitrust practitioners. In particular, we will examine the report’s conclusions within three broad headings—Rethinking Merger Review; Antitrust in the New Economy; and the Antitrust/IP Interface.  

August 30, 2007 | Permalink | Comments (0) | TrackBack (0)

Economics in the Whole Foods Merger Case

Posted by Luke Froeb

Last week, a federal judge refused to grant a preliminary injunction against the Whole Foods acquisition of Wild Oats (FTC website; testimony: day1 am, day1 pm, day2 am). He ruled that "premium, natural and organic supermarkets" was a not a "relevant product market." A relevant market is one in which a hypothetical, multi-product monopolist, owning all stores in the category (and eliminating competition among them), would raise price.

[Read the entire post here]

August 30, 2007 | Permalink | Comments (0) | TrackBack (0)

Wednesday, August 29, 2007

September 5 Abstract Deadline Approaching for Latin American Competition Policy Conference

Posted by D. Daniel Sokol

The deadline to submit abstracts for the Latin American Competition Policy Conference in Sao Paolo is nearing (September 5).  Make sure to submit your abstract for the conference.  The conference themes are competition advocacy and cartels.  Both issues are critically important in Latin America.

Conference details can be found here.  Expenses will be covered for conference presenters.

August 29, 2007 | Permalink | Comments (0) | TrackBack (0)

Northwestern University Research Symposium on "Insurance Markets and Regulation" - Call for Papers

Posted by D. Daniel Sokol

The Searle Center is issuing a call for original research papers to be presented at a Research Symposium on Insurance Markets and Regulation at Northwestern University School of Law. The Symposium will run from 11:30 AM on Monday, April 14th to Tuesday, April 15th at 1:30 PM.

The goal of this Research Symposium is to encourage rigorous, high-quality, policy-relevant research on insurance markets and regulation. The topics covered and the exact format of the symposium will be determined in part by the submissions. Potential topics include (but are limited to) Optional Federal Chartering of Insurance Companies; Antitrust and Insurance Regulation; Jurisdictional Competition; Exit Barriers; Tort Reform; Natural Disasters and State Solvency Regulation; Preemption; Federal Insurance Programs; Health Insurance; and Medical Malpractice Insurance.


The Symposium will feature a Keynote Luncheon Address by Representative Melissa Bean (D-Illinois, 8th District) on Monday, April 14. Representative Bean has introduced legislation for optional federal chartering of insurance companies. There will be a reception, dinner and program on Monday evening. The Symposium will conclude on Tuesday with a luncheon roundtable discussion of emerging public policy issues affecting insurance markets.

Authors will receive an honorarium of $6,000 (plus reasonable travel expenses). Honoraria will be paid in two installments - 50 percent at the symposium, and 50 percent upon revision in response to comments at the symposium.

The Symposium format will include Discussants of the various papers. The typical Discussant will be asked to comment on two papers as part of a panel discussion. Discussants will be paid an honorarium of $1,000 (plus reasonable transportation expenses).

Papers prepared for the Research Symposium on "Insurance Markets and Regulation" will be permanently hosted on The Searle Center website:

The Searle Center intends to market the papers as a package for a law review symposium; if not picked up by a law review, the authors would be free to publish their work in other venues (with appropriate acknowledgement of The Searle Center).


Research Proposals should include an abstract (300 words maximum), c.v., and whatever supporting documents the author believes will be helpful in the review process.

Research Proposals should be submitted

Research Proposals will be reviewed by a three-member committee. Authors will be notified of the committee's decisions by November 1.  Papers must be received by March 24, 2008. Revised Papers must be received by June 1, 2008.

Potential Discussants should send a message indicating their interest in insurance markets and regulation to:


August 29, 2007 | Permalink | Comments (0) | TrackBack (0)

Leniency and Whistleblowers in Antitrust

Posted by D. Daniel Sokol

Giancarlo Spagnolo of the University of Tor Vergata in Italy offers a new way to think comparatively about whistleblowers in Leniency and Whistleblowers in Antitrust.

ABSTRACT: The paper reviews the recent evolution of leniency programs for cartels in the US and EU, surveys their theoretical economic analyses, and discusses the empirical and experimental evidence available, also looking briefly at related experiences of rewarding whistleblowers in other fields of law enforcement. It concludes with a list of desiderata for leniency and whistleblower reward programs, simple suggestions how to improve current ones, and an agenda for future research. The issues discussed appear relevant to the fight of other forms of multiagent organized crime - like auditor-manager collusion, financial fraud, or corruption - that share with cartels the crucial features that well designed leniency and whistleblower programs exploit.

August 29, 2007 | Permalink | Comments (0) | TrackBack (0)

Tuesday, August 28, 2007

Highlights of the Third Reading of the Chinese Draft Anti-Monopoly Law

Posted by D. Daniel Sokol

A new Chinese language newspaper report provides Highlights of the Third Reading of the Chinese Draft Anti-Monopoly Law.  This news comes from Chinese competition and IP law guru Paul Jones.  Paul has summarized for those of us who do not read Chinese:

The highlights include a ban on horizontal arrangements. Interestingly one of the prohibited behaviors is listed as “ restricting the purchase of new technology, new equipment or restrictions on the development of new technologies.” There will be a special chapter on administrative provisions restricting competition. The State Council is to set up an Anti-Monopoly Commission that will undertake various types of investigative work and make administrative determinations on penalties. Finally the article mentions that this draft specifies that the law will be applicable to operators who abuse intellectual property rights.

August 28, 2007 | Permalink | Comments (1) | TrackBack (0)

Standardizing the Law of Antitrust Oversight of Standard Setting

Posted by D. Daniel Sokol

Today's BNA Antitrust & Trade Regulation Daily reports on the EU's first foray into "patent ambush" cases under Article 82 based on potential anti-competitive conduct by Rambus.  This conduct should ring a bell for US practitioners.  On standard setting, Phil Weiser of the University of Colorado Law School has a new paper that attempts to tackle standard setting issues in Standardizing the Law of Antitrust Oversight of Standard Setting.

ABSTRACT: The stance of antitrust oversight of standard setting activities remains a work-in-progress. Over time, antitrust authorities have grown increasingly hospitable to cooperative standard setting efforts whereby jointly developed standards will facilitate the development of new products or services. In the information industries, such standards are ubiquitous and, moreover, are set by international standard setting organizations (SSOs) like the Internet Engineering Task Force (IETF). To be successful, SSOs must develop strategies to prevent firms from patenting technologies used in official standards and charging exorbitant royalties once a standard is adopted. In particular, SSOs face a range of options in terms of policies that govern the use of patents in official standards - even within the popular strategy of mandating reasonable and non-discriminatory (RAND) access to patents necessary to practice a standard. With multi-jurisdictional oversight of SSOs, the role of antitrust law - if inconsistent and overly aggressive - could be counterproductive.

This paper argues that international antitrust authorities should be humble about second guessing policies of standard setting bodies related to patent policies or playing an aggressive enforcement role. By so doing, antitrust authorities will signal to standard setting bodies that they must rely fundamentally on their own strategies for ensuring compliance with their own policies. Such policies, for example, could include a mandate that firms disclose the relevant licensing terms and conditions before the body decides to endorse a particular technology as part of a standard. To be sure, there is still a role for antitrust authorities to sanction egregious abuses of the standard setting process, such as the Federal Trade Commission's action in Rambus, but such actions should be exceptional and not viewed as an alternative to a standard setting body's safeguards against abuses by firms that obtain patents on technologies necessary to practice the standard.

August 28, 2007 | Permalink | Comments (0) | TrackBack (0)

Sunday, August 26, 2007

The Analysis of Coordinated Effects in EU Merger Control: Where Do We Stand after Sony/BMG and Impala?

Posted by D. Daniel Sokol

With the implications of Whole Foods/Wild Oats still sinking in, I thought it might be interesting to think about merger analysis in the EU.  Gisela Aigner, Oliver Budzinski and Arndt Christiansen, all of the University of Marburg have authored an analysis of the state of play of EU merger law specific to coordinated effects titled The Analysis of Coordinated Effects in EU Merger Control: Where Do We Stand after Sony/BMG and Impala?

ABSTRACT: The recent Impala Judgment by the CFI on the Sony/BMG Decision by the Commission represents the most important ruling on collective dominance since Airtours. We review both the Decision and the Judgment and derive implications for the institutional and substantive development of EU Merger Control. Firstly, Impala introduces an ambitious symmetric standard of proof for prohibition and clearance decisions by the Commission. While alleviating fears of an increasing number of false positives in the aftermath of Airtours, this entails the problem how to deal with cases in which neither the existence, nor the absence of anticompetitive effects can be proven to the required standard. Secondly, Impala represents to some extent a comeback of coordinated effects analysis, further précising the conditions for establishing this kind of anticompetitive effects. Thirdly, the ongoing process of increasing the role of third parties in European Merger Control is fuelled. Additionally, and given the characteristics and the development of the music industry, we criticise a lacking in-depth economic analysis of a potential decrease innovation efficiency as well as an increase in foreclosure effects following the merger.

August 26, 2007 | Permalink | Comments (0) | TrackBack (0)