Antitrust & Competition Policy Blog

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

A Member of the Law Professor Blogs Network

Saturday, October 11, 2008

The European Antitrust Review 2009

Posted by D. Daniel Sokol

The Global Competition Review has released The European Antitrust Review 2009.  Contributors include:

Introduction
Philip Lowe Directorate General for Competition, European Commission

EU substantive areas

Cartels
Julian Joshua, Kristian Hugmark and Ief Daems Howrey LLP

Compliance
Kiran Desai Mayer Brown

Joint Ventures
Ted Henneberry and Douglas Lahnborg Heller Ehrman LLP

Judicial review
Javier Ruiz Calzado and Eric Barbier de La Serre Latham & Watkins LLP

Efficiencies and Remedies
Michael Rosenthal, R Hewitt Pate and Alexandros Papanikolaou Hunton & Williams LLP

Monopolies and Market Dominance
Alexander Böhlke Kemmler Rapp Böhlke

Private Antitrust Litigation
Tim Reher CMS Hasche Sigle

State Aid
Paris Anestis and Eleftheria Psaraki Howrey LLP

Vertical Agreements
Astrid Ablasser-Neuhuber and René Plank bpv Hügel Rechtsanwälte

EU–Canada Cooperation
Susan M Hutton Stikeman Elliott LLP

EU industry sectors

Chemicals
Flavia Distefano McKenna Long & Aldridge LLP

Energy
Riccardo Celli, Christian Riis-Madsen and Philippe Noguès O’Melveny & Myers LLP

Private Equity
Pierre-André Dubois and Arabella Hinton Kirkland & Ellis International LLP

Technology
Pierre-André Dubois and Arabella Hinton Kirkland & Ellis International LLP

Country chapters

Austria
Astrid Ablasser-Neuhuber and Florian Neumayr bpv Hügel Rechtsanwälte

Czech Republic
Arthur Braun and Stepan Svoboda bpv Braun Haškovcová

Denmark
Jesper Fabricius and Asser Rung-Hansen Accura

Finland
Anna Kuusniemi-Laine, Sari Hiltunen and Anne Laine Castrén & Snellman

France: Cartels
Marc Lévy and Natasha G Assadi-Tardif SJ Berwin

France: Merger Control
Antoine Choffel and Yann Utzschneider Gide Loyrette Nouel AARPI

Germany: Overview
Andreas Weitbrecht and Susanne Zühlke Latham & Watkins LLP

Germany: Cartels
Alexander Rinne and Tilman Siebert SJ Berwin

Germany: Merger Control
Martina Maier and Philipp Werner Howrey LLP

Germany: Private Antitrust Litigation
Alexander Rinne and Tatjana Mühlbach SJ Berwin

Greece
Despina D Samara Calavros & Partners

Hungary
László Kelemen and Geoff Bennett Szabó Kelemen & Partners Attorneys

Ireland
Helen Kelly Matheson Ormsby Prentice

Israel
Eytan Epstein and Tamar Dolev-Green Epstein Chomsky Osnat & Co

Italy: Cartels
Davide Balboni and Laura Matilde Cerri SJ Berwin

Italy: Telecoms and Media
Eutimio Monaco and Domenico Siciliano Bird & Bird

Latvia
Liga Hartmane and Martins Gailis Klavins & Slaidins LAWIN

Luxembourg
Philippe-Emmanuel Partsch Arendt & Medernach

Netherlands: Cartels
Esther Glerum-van Aalst, Marleen de Putter and Andre Reznitchenko Kneppelhout & Korthals

Netherlands: Merger Control
Michel Chatelin and Simone Schippers Eversheds Faasen

Norway
Henrik Svane, Camilla Tellefsdal Robstad and Marianne Elind Kvale & Co

Poland
Magorzata Modzelewska de Raad, Pola Ciupa and Joanna Kruk-Kubarska Wierzbowski Eversheds

Portugal
Mário Marques Mendes and Pedro Vilarinho Pires Marques Mendes & Associados

Romania
Silviu Stoica Popovici Nitu & Asociatii

Russia
Tapani Manninen, Kseniya Sirotenko and Elena Sokolovskaya Hannes Snellman

Spain: Overview
Juan Jiménez Laiglesia, Alfonso Ois and Gerard Pérez Olmo DLA Piper

Spain: Cartels
Ramón García-Gallardo SJ Berwin

Spain: Merger Control
Marcos Araujo, Konstantin J Jörgens and Crisanto Pérez-Abad Garrigues

Spain: Telecoms and Media
Blanca Escribano and Sofía Fontanals Bird & Bird

Switzerland
Franz Hoffet, Marcel Dietrich and Katrin Ivell Homburger

Turkey
Seçil Abali and Merve Öralay Cerrahoglu Law Firm

United Kingdom: Overview
Becket McGrath and Simon Albert Berwin Leighton Paisner LLP

United Kingdom: Cartel Regulation
Simon Holmes, Philipp Girardet and Amanda Butler SJ Berwin

United Kingdom: Private Enforcement
Lesley Farrell and Sarah Ince SJ Berwin

October 11, 2008 | Permalink | Comments (0) | TrackBack (0)

Friday, October 10, 2008

FTC Workshop on Hart-Scott-Rodino Premerger Notification Program

Posted by D. Daniel Sokol

The FTC will host a very worthwhile half day program on the Hart-Scott-Rodino Premerger Notification Program called "Back to the Basics."

       
When: October 23, 2008, 9:00am - 1:00pm
Where:  FTC Conference Center
  601 New Jersey Avenue, NW
  Washington, DC 20001

and via webcast
In recognition of the 30th Anniversary of the implementation of Hart-Scott-Rodino Antitrust Improvements Act, the Bureau of Competition's Premerger Notification Office will host a half-day public workshop on the basics of HSR premerger notification, covering such topics as how to determine whether premerger notification is required and how to prepare an HSR filing.  The workshop is free and open to the public.  Due to space limitations, registration is limited to practitioners with less than one year of experience with premerger notification rules and filings.  The workshop will be webcast live; check the link on this page on the day of the workshop to view.  For more information about the workshop, contact Kathryn E. Walsh at (202) 326-2977.

The workshop will be held at the FTC’s satellite building conference center, located at 601 New Jersey Avenue, N.W., Washington, D.C. All attendees will be required to display a current driver's license or other valid form of photo identification.

October 10, 2008 | Permalink | Comments (0) | TrackBack (0)

Whole Foods Saga Continues Before DC Circuit

Posted by D. Daniel Sokol

Below are links to Whole Foods team  motion and reply brief filed in the D.C. Circuit this week related to their petition for rehearing en banc.

Download 20081006_wfm_motion_for_leave_to_file_reply.pdf
Download 20081006_wfm_reply_on_p.pdf

Update - The WSJ Law Blog has a new twist on this story on how the appeals team transcends political boundaries.

October 10, 2008 | Permalink | Comments (0) | TrackBack (0)

Slotting Allowances and Manufacturers' Retail Sales Effort

Posted by D. Daniel Sokol

Oystein Foros, Norwegian School of Economics and Business Administration, Hans Jarle Kind, Norwegian School of Economics & Business Administration, and Jan Yngve Sand, University I Tromso have a new paper on Slotting Allowances and Manufacturers' Retail Sales Effort.

ABSTRACT: A manufacturer's incentives to undertake non-contractible investments depend on the profit margin on her sales to the retailer, and slotting allowances can facilitate such incentives by increasing unit wholesale prices. At first glance, it is tempting to conclude that slotting allowances should be particularly prevalent for product categories where the manufacturer's scope for undertaking non-contractible sales effort is relatively large. At odds with this, The Federal Trade Commission, among others, reports that slotting allowances are more commonly used for product categories where the scope for non-contractible effort by the manufacturer is presumably relatively small. To scrutinize this puzzle we set up a simple model with one manufacturer and one retailer, where the manufacturer undertakes noncontractible demand-enhancing investments. The predictions from the model are consistent with the market observations. In particular, we show that even a retailer with complete bargaining power may actually find it optimal to pay the manufacturer a franchising fee if demand is highly sensitive to the manufacturer's non-contractible sales effort. For product categories where the scope for non-contractible effort is relatively small, on the other hand, we are more likely to see slotting allowances.

October 10, 2008 | Permalink | Comments (0) | TrackBack (0)

A Flexible Approach to RAND Licensing

Posted by D. Daniel Sokol

Mikko Valimaki, Helsinki University of Technology, University of Eastern Piedmont - A. Avogadro, Swedish School of Economics and Business Administration describes A Flexible Approach to RAND Licensing.

ABSTRACT: This article discusses the meaning of reasonable and non-discriminatory (RAND) licensing terms in standards from European competition law perspective. Building on the Microsoft case, the article argues that the competition law assessment of RAND must take into account the licensing environment where the standard is used. The proposed flexible case-by-case approach to RAND would be also economically justified.

October 10, 2008 | Permalink | Comments (0) | TrackBack (0)

Thursday, October 9, 2008

Cartel Enforcement in Australia

Posted by D. Daniel Sokol

Bob Baxt (Freehills) & Gillian McKenzie (Freehills) give us an update of Cartel Enforcement in Australia.

ABSTRACT: Historically cartel behavior in Australia has been subject to a civil penalty regime under the Trade Practices Act 1974 (“the Act”). Since the 1974 enactment of the legislation, price fixing and similar anticompetitive contracts, arrangements, or understandings have been treated as per se illegal under the Act. However, the penalties for breaching these provisions were historically quite low until 2007 when the civil penalties were increased significantly. There is now a very determined effort on the part of the new Federal Labor Government to introduce criminal sanctions against serious cartels and to bring Australia in line with the developments in the U.S., Canada and in other countries.

The relevant regulator, the Australian Competition and Consumer Commission (“ACCC”), has actively pursued stronger enforcement powers and harsher sanctions to address cartel conduct. Graeme Samuel, Chairman of the ACCC, once described cartels as a ‘cancer on our economy’, stealing ‘billions of dollars…from business, from taxpayers and ultimately from…consumers’.

This paper considers both the existing civil regime for enforcing prohibitions on cartel behavior, as well as noting certain aspects of the foreshadowed criminal sanctions.

October 9, 2008 | Permalink | Comments (0) | TrackBack (0)

Wednesday, October 8, 2008

25th PURC/World Bank International Training Program on Utility Regulation and Strategy

Posted by D. Daniel Sokol

January 12 - 23, 2009
Gainesville, Florida, USA

Utility regulators, policy-makers and infrastructure managers around the world will travel to Gainesville, Florida to participate in the University of Florida PURC/World Bank International Training Program on Utility Regulation and Strategy. They will learn problem-solving techniques and exchange ideas and experiences during an international forum for the dissemination of relevant best practices and research.

The international training program is an intensive, two-week course specifically tailored to the professional requirements of utility regulators and regulatory staff. The course is designed to enhance the economic, technical, and policy skills required for implementing policies and managing sustainable regulatory systems for infrastructure sectors.

The program is a collaborative effort between the World Bank and PURC and is offered each January and June in Gainesville, Florida. Each program encompasses more than 50 sessions that include case studies, practical exercises and panel discussions with leading experts and international faculty.

More than 1,800 utility professionals from 133 nations have participated in the course since 1997.

Apply online here.

October 8, 2008 | Permalink | Comments (0) | TrackBack (0)

The End or the Means? The Pursuit of Competition in Regulated Telecommunications Markets

Posted by D. Daniel Sokol

Bronwyn_howell_1 Bronwyn E. Howell, NZ Institute for the Study of Competition and Regulation Inc. and Victoria Management School, Victoria University of Wellington asks, The End or the Means? The Pursuit of Competition in Regulated Telecommunications Markets.

ABSTRACT: Economic analysis takes as its defining performance benchmark the pursuit of increases in welfare (efficiency). Competition is merely one of a variety of means of achieving the efficiency end, especially in industries where the underlying economic circumstances predispose them towards greatest efficiency when competition (in the form of many market participants) is restricted. Typically, regulatory intervention in these industries is justified by the imperative to increase efficiency. Competition law and industry-specific regulation provide two competing means of intervention whereby the pursuit of efficiency can be enhanced. The challenge is in determining how to allocate responsibility for governance of industry interaction between these two institutional forms. Whilst competition law can govern interaction in most industries, where the underlying economic conditions are sufficiently different, industry-specific regulation offers advantages. However, its weakness is the risk of capture, leading to the subjugation of the efficiency end to the pursuit of other objectives (e.g. competition - the means - as an end in itself). But if the regulatory institution could be bound in some way to pursue an efficiency objective, could the risk of capture be averted?

By exploring the attempts to prioritise the pursuit of efficiency via both competition law and industry-specific regulation in New Zealand over the past twenty years, this paper concludes that such an endeavour is unlikely to be successful in the long run. As politicians ultimately control the rules by which the regulatory responsibilities are allocated, and politicians are themselves pose a potential risk of capture for the industry-specific regulatory processes, the inability of a government prioritising efficiency objectives to bind its successors to the same objectives means that the efficiency objective is not stable. From the New Zealand experience, the outcome could be total subjugation of industry-specific regulation to direct political control and the abandonment of efficiency as a primary regulatory objective. This suggests that, imperfect though it may be, competition law overseen by a judiciary with greater independence of the political process, offers the best chance of enshrining pursuit of efficiency into the governance of industry interaction, even in industries normally the focus of industry-specific regulation.

October 8, 2008 | Permalink | Comments (0) | TrackBack (0)

Are “Online Markets” Real and Relevant? From Monster/Hotjobs to Google/DoubleClick

Posted by D. Daniel Sokol

Bruce Abramson, President, Informationism, Inc.; Senior Consultant, CRA International has a new piece titled Are “Online Markets” Real and Relevant? From Monster/Hotjobs to Google/DoubleClick.

ABSTRACT: This article examines two Internet merger investigations from 2001 and 2007 to answer the question of whether there is such a thing as a distinct "Internet market," and if so, how an antitrust analysis of such a market should differ from parallel analyses applied to more conventional markets. A quick comparison of two Internet advertising mergers from different stages of the Internet's existence demonstrates two things. First, as the novelty of the Internet wears off, online merger analysis looks increasingly like offline merger analysis. Second, most of the things that make online mergers interesting have little to do with competition law.

October 8, 2008 | Permalink | Comments (0) | TrackBack (0)

European Commission Opinions to National Courts in Antitrust Cases: Consistent Application and the Judicial-Administrative Relationship

Posted by D. Daniel Sokol

Kathryn Wright, ESRC Centre for Competition Policy, University of East Anglia provides some analysis on European Commission Opinions to National Courts in Antitrust Cases: Consistent Application and the Judicial-Administrative Relationship.

ABSTRACT:The House of Lords judgment in Inntrepreneur v Crehan, where the court did not consider itself bound by a finding of the European Commission, demonstrated the potentially contentious and constitutionally significant nature of the relationship between the European Commission and national judges in the field of antitrust.

The decentralisation of enforcement of Articles 81 and 82EC arguably carries greater risks of divergent application of EC antitrust enforcement rules. While national competition authorities are linked through the European Competition Network, no such mechanism exists for national courts as this would offend against the principles of judicial independence and procedural autonomy. The Commission, as primary enforcer of competition law in the Community, has therefore attempted to complement the formal judicial 'dialogue' of the European Court of Justice's preliminary reference procedure with a strengthening of its own relations with the national courts.

After addressing the broader theoretical context of administrative intervention in judicial decision-making, this paper examines the use of one tool to promote consistent application of EC antitrust rules - non-binding European Commission opinions and amicus curiae briefs to national courts in antitrust proceedings under Article 15 of the Modernisation Regulation. It identifies national cases where the Commission has actually intervened under Article 15 and assesses the nature and efficacy of this soft law mechanism. One finding is the difficulty in finding and tracing the cases, making the impact of the Commission’s advice difficult to judge. Transparency is desirable for legitimacy, legal certainty, and if Commission opinions are to have the most impact for promoting convergent application of EC antitrust rules among national judges.

October 8, 2008 | Permalink | Comments (0) | TrackBack (0)

Some Changes on the Blog

Posted by D. Daniel Sokol

You may have noticed some changes on the blog.  Shubha has moved from his position as blog co-editor to a contributing editor.  This means that Shubha is slowing down his participation a bit.  I will remain as the editor of the blog.  Coming in as additional blog contributing editors will be people from both the left and right of antitrust to occasionally provide commentary about antitrust issues.  Think of this as our attempt to become a virtual Justice League to house a collection of antitrust Superfriends.  For those of you who wax nostalgic about the Superfriends (Thom Lambert, that means you) I found a link to the video for the Superfriends opening credits theme song.  Our new contributing editors are:

Ftcphoto Luke Froeb, William C. and Margaret W. Oehmig Associate Professor in Entrepreneurship and Free Enterprise at Vanderbilts Owen School of Management.

Luke Froeb served as Director of the Bureau of Economics at the Federal Trade Commission for two years where he managed over a hundred civil servants dedicated to tearing down barriers to competition (often erected by well-meaning bureaucrats), in addition to enforcing the antitrust and consumer protection laws of the United States. In July 2005, Professor Froeb returned to Vanderbilt University where he holds the Margaret and William Oehmig Chair of Entrepreneurship and Free Enterprise. Professor Froeb's research is focused on the economics of competition policy. After receiving his Ph.D. in economics from the University of Wisconsin, he taught at Tulane University, worked as an economist at the U.S. Department of Justice, and then spent a year at the University of Chicago Law School before moving to Vanderbilt. When the antitrust agencies began using his merger models to predict whether mergers would raise price, people began reading the articles he had written. Professor Froeb now divides his time between teaching, writing, and consulting on management and antitrust issues. He was voted outstanding professor of the 2005 executive MBA program by his students.

Darrenbush Darren Bush, Associate Professor, University of Houston Law Center

Professor Bush writes and lectures on antitrust law & economics and regulated and deregulating industries with particular focus on electricity markets.

Professor Bush received his Ph.D. from the University of Utah, where he received a Teaching Fellowship, the Graduate Research Fellowship, and an award for outstanding teaching. While completing his J.D. at Utah, he consulted on issues regarding state deregulation of electric utilities, interned at the U.S. Department of Justice's Antitrust Division, taught various economics courses, and received a Marriner S. Eccles Fellowship in Political Economy.

After receiving his J.D., Professor Bush served as an Attorney General's Honor Program Trial Attorney at the Antitrust Division's Transportation, Energy, & Agriculture Section, where his primary focus was the investigation of mergers and anticompetitive conduct in wholesale and retail energy markets. In 2001 Professor Bush returned to Utah as a Visiting Associate Professor, where he taught antitrust, law & economics, business organizations, and professional responsibility and consulted on numerous antitrust matters.

October 8, 2008 | Permalink | Comments (0) | TrackBack (0)

Competition policy, growth and consumer purchasing power

Posted by D. Daniel Sokol

Our enforcer friends in the EU at DG Competition will be hosting a conference on Competition policy, growth and consumer purchasing power.  The date of the conference is October 13 in Brussels.

October 8, 2008 | Permalink | Comments (0) | TrackBack (0)

Tuesday, October 7, 2008

FTC Section 5 Public Workshop

Posted by D. Daniel Sokol

The FTC will host a workshop on Section 5 of the FTC Act on October 17, 2008 to figure out the scope for "unfair competition.

According to the FTC press release:

Four workshop panels will explore: 1) the history of Section 5, including its enactment by Congress (and subsequent interpretations by the Congress and the courts); 2) a range of possible legal interpretations of Section 5; 3) the application of these interpretations to various examples of business conduct, including the practical implications of enforcement actions; and 4) the application of Section 5 to competition issues involving standard-setting. In addition, three FTC Commissioners – Chairman William E. Kovacic, Commissioner J. Thomas Rosch, and Commissioner Jon Leibowitz – will address the workshop.    

The workshop will be held at the FTC conference facilities at 601 New Jersey Avenue, N.W., in Washington, DC. It is free and open to the public. People attending the workshop must present identification, but pre-registration is not required. The agenda describing each of the four panels and listing the panelists can be found on the workshop home page, http://www.ftc.gov/bc/workshops/section5/index.shtml.

Chairman Kovacic will make opening remarks at 9:00 a.m. The first panel, which will review the history of Section 5, will begin at 9:15. Speakers will include Marc Winerman, an attorney advisor to Chairman Kovacic; and Professor Stephen Calkins of Wayne State Law School.    

The second panel, addressing various legal interpretations of Section 5, will begin at 10:15. The scheduled speakers include Robert Pitofsky, former Chairman of the FTC and Professor at Georgetown Law School; Professor Michael Salinger of the Boston University School of Management; Michael Antalics, a partner at the law firm of O’Melveny & Myers; Professor William Page of the University of Florida College of Law; Professor Robert Lande of the University of Baltimore School of Law; and Professor Daniel Crane of the Benjamin Cardozo School of Law.

Commissioner Rosch will present remarks at 1:15 p.m, and the third panel, which will consider examples of business conduct, begins at 1:30. Speakers on the panel will include Susan Creighton, a partner at the law firm of Wilson Sonsini Goodrich & Rosati; Thomas B. Leary, former FTC Commissioner and now of counsel at the law firm of Hogan & Hartson; Abbott (Tad) Lipsky, Jr., a partner at the law firm of Latham & Watkins; David Balto, an attorney and former Assistant Director for Planning at the FTC; and Albert Foer, President of the American Antitrust Institute.    

Commissioner Leibowitz will present remarks at 3:15, and the fourth panel, which will examine standard-setting, begins at 3:30. Its speakers will include Robert Skitol, a partner at the law firm of Drinker Biddle & Reath; Richard Taffet, a partner at the law firm of Bingham McCutchen; Geoffrey Oliver, a partner at the law firm of Jones Day; Scott Peterson, a patent specialist at the Hewlett-Packard Co.; Michael Lindsay, a partner at the law firm of Dorsey & Whitney; Jack Slobod, Senior Director, IP Licensing, Philips Electronics; and Amy Marasco, General Manager, Standards Strategy, Microsoft.

In conjunction with the workshop, the FTC seeks the views of the legal, academic, and business communities on the issues to be explored. A Federal Register notice, which can be found at http://www.ftc.gov/os/2008/08/P083900section5.pdf, published August 28, 2008, poses a series of questions about which the FTC seeks written views and provides instructions for submitting comments. Any interested person may submit comments, which must be received by October 24, 2008.    

Copies of the workshop agenda are available from the FTC’s Web site at http://www.ftc.gov/bc/workshops/section5/index.shtml

October 7, 2008 | Permalink | Comments (0) | TrackBack (0)

Regulatory Structure under EC Competition Laws: Lessons for India

Posted by D. Daniel Sokol

Tarun Jain (Advocate, Supreme Court of India) writes on Regulatory Structure under EC Competition Laws: Lessons for India.

ABSTRACT: The aim of this paper is to examine the regulatory structure in vogue under the EC competition law and to identify the key traits which may as well be applicable for the recently formulated Competition Commission of India, in its quest towards rendering competition workable in the Indian markets.

The Chapterization is as under:

1. Introduction

2. Regulatory Structure under EC competition laws
2.1 The legal regime for competition in EC
2.2 The EC Regulatory Authorities
2.2.1 EC Commission
2.2.2 The Advisory Committee
2.2.3 National Competition Authorities & European Competition Network

3. Lessons for India
3.1 Regulatory Structure under the Competition Act, 2002
3.2 Lessons from the EC model for India

4. Conclusion

October 7, 2008 | Permalink | Comments (0) | TrackBack (0)

Do Patent Holdup and Royalty Stacking Lead to Systematically Excessive Royalties?

Posted by D. Daniel Sokol

Elhaugee Einer Elhauge of Harvard Law School asks Do Patent Holdup and Royalty Stacking Lead to Systematically Excessive Royalties? 

ABSTRACT: Some recent literature has concluded that patent remedies result in systematically excessive royalties because of holdup and stacking problems. This article shows this literature is mistaken. The royalty rates predicted by the holdup models are often (plausibly most of the time) below the true optimal rate. Further, those predicted royalty rates are overstated because of incorrect assumptions about constant demand, one-shot bargaining, and informational symmetry. Although this literature concludes that overcompensation problems are exacerbated by doctrines measuring damages using past negotiated royalties, in fact such doctrines exacerbate undercompensation problems. Undercompensation problems are further increased to the extent that juries cannot measure damages with perfect accuracy, a problem that persists even if damages are just as likely to be overestimated as underestimated. Nor do the royalty rates predicted by the holdup model apply if there is competition in the downstream product market or upstream market for inventions. Royalty stacking does not lead to royalties that exceed the optimal rate, contrary to this literature, but in fact tends to produce royalties that are at or below the optimal rate.

October 7, 2008 | Permalink | Comments (0) | TrackBack (0)

Collusion and Strategic Favoritism in Organizations

Posted by D. Daniel Sokol

Zhijun Chen, University of East Anglia - Centre for Competition Policy, Zhejiang University - Department of Economics has posted a paper Collusion and Strategic Favoritism in Organizations.

ABSTRACT: Fighting collusion has long been a challenge in organizations, whilst favoritism in organizations has long been attacked as one of the most important sources of workplace conflicts. This paper links the phenomena of collusion and favoritism together which seem to be irrelevant. We show that favoritism cannot benefit organizations where collusion is not a serious concern; meanwhile favoritism is not effective in dealing with well-organized collusion; however, strategic use of favoritism can bring conflicts among collusive subordinates and undermine the efficiency of collusion, therefore it is effective in fighting collusion.

October 7, 2008 | Permalink | Comments (0) | TrackBack (0)

Some New Developments after the Coming-into-Effect of Chinese Anti-Monopoly Law

Posted by D. Daniel Sokol

127leonLiyang Hou of the Katholieke Universiteit Leuven provides some thoughts on Some New Developments after the Coming-into-Effect of Chinese Anti-Monopoly Law.

ABSTRACT: On 1st August, 2008 Chinese Anti-Monopoly Law (CAL) became effective. A lot of people claim CAL is the shortest competition law in the whole world. Based on this, you can imagine how crude this law is and how urgent the adoption of implementation guidance is. However, apparently the implementation measures have not fully on the agenda yet, though the law turned into effective this month. Nevertheless, several actions taken by the Central Government of China were initiated regarding the implementation of the CAL.

October 7, 2008 | Permalink | Comments (0) | TrackBack (0)

Monday, October 6, 2008

Cartels, Managerial Incentives, and Productive Efficiency in German Coal Mining, 1881-1913

Posted by D. Daniel Sokol

I am always thrilled when someone does a historical study of antitrust issues.  In this vein, Carsten Burhop, Max Planck Society for the Advancement of the Sciences - Max Planck Institute of Research on Collective Goods and Thorsten Luebbers, Max Planck Society for the Advancement of the Sciences - Max Planck Institute of Research on Collective Goods have written on Cartels, Managerial Incentives, and Productive Efficiency in German Coal Mining, 1881-1913.

ABSTRACT: In this paper, we evaluate the impact of cartelisation and managerial incentives on the productive efficiency of German coal mining corporations. We focus on coal mining in the Ruhr district, Germany's main mining area. We use stochastic frontier analysis and an unbalanced dynamic panel data set for up to 28 firms for the years 1881-1913 to measure productive efficiency. We show that coal was mined with decreasing returns to scale. Moreover, it turns out that cartelisation did not affect productive efficiency. Controlling for corporate governance variables shows that stronger managerial incentives were significantly correlated with productive efficiency, whereas the debt-equity ratio did not influence it.

October 6, 2008 | Permalink | Comments (0) | TrackBack (0)

Section 2 and Standard Setting: Rambus, N-Data & The Role of Causation

Posted by D. Daniel Sokol

FTC Commissioner Tom Rosch delivered a speech on Section 2 and Standard Setting: Rambus, N-Data & The Role of Causation recently.

SPEECH ABSTRACT: I had prepared some general remarks on the antitrust issues in standard setting and patent pools. But I will leave it to others to discuss the competitive benefits and risks of those practices. You are fortunate to have some great panelists here today and I know they plan on covering many of the issues outlined in my presentation. That gives me the liberty to focus on two Commission matters that have attracted a great deal of attention this year – Rambus and NData. Specifically, I will discuss the role of causation in these cases. Why? Because causation is important to understanding not only my vote in N-Data but also, I believe, the D.C. Circuit’s decision in Rambus. I suggest that the Court’s analysis of causation, which was squarely contrary to its teaching in Microsoft, is the most fundamental reason that decision was flawed.

October 6, 2008 | Permalink | Comments (0) | TrackBack (0)

The Next Antitrust Agenda: The American Antitrust Institute's Transition Report on Competition Policy to the 44th President of the United States

Posted by D. Daniel Sokol

Today the American Antitrust Institute released its massive report: The Next Antitrust Agenda: The American Antitrust Institute's Transition Report on Competition Policy to the 44th President of the United States.

October 6, 2008 | Permalink | Comments (0) | TrackBack (0)