Antitrust & Competition Policy Blog

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

Monday, April 13, 2009

The Concept of an 'Undertaking': The Boundaries of the Corporation - A Discussion of Agency, Employees and Subsidiaries

Posted by D. Daniel Sokol

Townleycfromcompetition140x160 Christopher Townley (King's College, London - Law) offers his analysis on The Concept of an 'Undertaking': The Boundaries of the Corporation - A Discussion of Agency, Employees and Subsidiaries.

ABSTRACT: A paper discussing the limits of the notion of 'undertaking' for the purposes of European competition (antitrust) law. It examines the definition in relation to individuals (particularly the self-employed and consumers) and corporate groups (single economic entity) to understand where the boundaries of the undertaking are located. It then advocates certain changes to the current position, in light of Article 81 EC's myriad goals.

April 13, 2009 | Permalink | Comments (0) | TrackBack (0)

Screening for Conspiracies: Applications for Litigation, Pre-Litigation, Regulation and Internal Monitoring

Posted by D. Daniel Sokol

Rosa M. Abrantes-Metz, LECG, and Patrick Bajari, U. Minnesota- Economics have an interesting paper on Screening for Conspiracies: Applications for Litigation, Pre-Litigation, Regulation and Internal Monitoring.

ABSTRACT: A screen is a statistical test designed to detect conspiracies aimed at illegally manipulating a market. Competition authorities, academics and consultants have designed a variety screens to detect competition problems, and the use of such screens is increasing. In this paper, we first describe screens designed to detect bid rigging, price fixing, market allocation schemes and commodity market manipulation. Next, we discuss the ways in which screens can be used by plaintiffs and defendants in antitrust cases. These include (i) class certification, (ii) disproving the existence of a cartel; (iii) establishing the immateriality of a cartel; (iv) estimating the effects and damages of collusion; (v) assisting companies in deciding when and whether to file a leniency application; and (vi) assisting managers in large companies to monitor for data manipulation (e.g. falsified reimbursement or accounting statements) and price fixing in purchasing.

April 13, 2009 | Permalink | Comments (0) | TrackBack (0)

Essays on Consumer Welfare and Competition Policy

Posted by D. Daniel Sokol

Greg Werden of DOJ-Antitrust has written some Essays on Consumer Welfare and Competition Policy.

ABSTRACT: The discourse on competition policy often uses the term "consumer welfare" but rarely is clear about its meaning or role. I address the meaning and role of "consumer welfare" in three discrete essays. The first reviews key economic concepts and the usage of the term "consumer welfare" then outlines distinct ways in which consumer welfare considerations could be relevant in competition law. The second essay examines the meaning and role of consumer welfare in merger control. It concludes that the welfare of all consumers should be considered, but short-term price effects in the relevant market nevertheless should be the initial focus in assessing proposed mergers. The third essay examines the meaning and role of consumer welfare in competition law on concerted practices and potentially exclusionary conduct by individual competitors. It concludes that promoting the welfare of all consumers is the ultimate goal of the law but effect on consumer welfare is not the test for legality nor generally even an appropriate guide for the application of the law.

April 13, 2009 | Permalink | Comments (0) | TrackBack (0)

Complex Bundled Discounts and Antitrust Policy

Posted by D. Daniel Sokol

Herb Hovenkamp of the University of Iowa Law School and Erik N. Hovenkamp, University of Iowa - Department of Economics, B.S. Candidate 2009 (Herb's son?) have written an article on Complex Bundled Discounts and Antitrust Policy.

ABSTRACT: A bundled discount occurs when a seller conditions a discount or rebate on the buyer's purchaser or two or more different products. Firms that produce fewer than all the good in the bundle find it difficult to compete because they must amortize the discount across a smaller range of goods. For example, if the dominant firm offers a 10% discount for purchase of both good A and good B, but the rival makes only good B, it will have to offer a discount that is large enough to match the dominant firm's B discount as well as the foregone discount on A. The Antitrust Modernization Commission and several courts have adopted an "attribution" test for assessing the antitrust legality of bundled discounts. The test attributes the full discount to the product(s) for which rivals are claiming exclusion, and asks whether the resulting price is below cost. This test contains some features of the cost-based rule for single product predatory pricing, but it also differs in important respects. Both tests query whether an equally efficient rival can match the dominant firm's price.

Most models of bundled discounting consider two goods that are purchased in a one-to-one ratio. None of the judicial decisions involve such simplicity. In most the bundle consists of more than two goods, and different rivals may produce differing subsets of the dominant firm's bundle. Further, in nearly all of the cases the proportion of goods in the bundle can be varied at the will of the customer. We show that in such situations antitrust analysis of the bundle is significantly more complex and anti-competitive exclusion must typically be assessed on a rival-by-rival and customer-by-customer basis. This has important implications for the certification of class actions in bundled discount cases. We also provide some apparatus for assessing bundled discounts in these situations.

April 13, 2009 | Permalink | Comments (0) | TrackBack (0)

Sunday, April 12, 2009

Commssion's Guidance on Article 82 - May 11 Brussels

Posted by D. Daniel Sokol

On 3 December 2008, the Commission released a long awaited “Guidance Notice on its enforcement priorities in applying Article 82 of the EC Treaty to exclusionary abuses conduct by dominant undertakings”. This document, which has been presented as the closing chapter of the Commission’s Article 82 EC review, purports to provide greater clarity and predictability in Article 82 enforcement. However, the Guidance Notice leaves a number of issues unanswered and raises, in and of itself, a host of new questions. The purpose of this half-day conference is to offer a forum for debate on the most pressing issues arising from the Guidance Notice.

13:45‐14:00 Registration and Coffee

14:00‐14:15 Welcome Remarks and Purpose of the Event
Dr. Nicolas PETIT
Lecturer, University of Liege
Director of the LL.M in Competition and IP Law
Associate, Howrey LLP

14:15‐14:45 General – and Critical – Overview of the Guidance Notice
Brick Court Chambers

14:45‐15:15 How much more Economic is the New Approach?
Dr. Anne‐Lise SIBONY
Lecturer, University of Liege
Co‐director of IEJE

15:15‐15:45 Consumer Welfare as a Priority as opposed to an Objective
Lecturer, London School of Economics

15:45‐16:15 Efficiency Defences prior and after the Guidance Paper
Dr. Ekaterina ROUSSEVA
Case handler, DG COMP

16:15‐16:35 Coffee break

16:40‐17:10 Is the Guidance Notice on Article 82 EC a Suitable Instrument for Liberalized Markets?
Jones Day
Research fellow, ULg

17:10‐18:10 Panel Discussion – What are the “Likely Effects” of the Guidance Notice?
Moderator Jean‐François BELLIS
Partner, Van Bael & Bellis
University of Liege and University of Brussels
Participants Carles ESTEVA‐MOSSO [TBC]
Acting Director, DG COMP
Partner, Howrey LLP
Jean‐Baptiste SIPROUDHIS [TBC]
Head of the Competition Law Group, EDF

18:10 Cocktail
Register for the event in the attached pdf.
Download Programme - The Commssion's Guidance on Exclusionary Abuses - 11 May 2009 - Brussels

April 12, 2009 | Permalink | Comments (0) | TrackBack (0)