Antitrust & Competition Policy Blog

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

Saturday, July 25, 2009

Is Antitrust Enforcement Creating Rifts in the Obama Administration?

Posted by D. Daniel Sokol

The New York Times has a story that reports that enforcement by antitrust enforcers has met with resistance by others in the administration.

July 25, 2009 | Permalink | Comments (0) | TrackBack (0)

The Handbook of Competition Economics 2009 Edition is Out

Posted by D. Daniel Sokol

The Global Competition Review has published The Handbook of Competition Economics 2009 Edition.

July 25, 2009 | Permalink | Comments (0) | TrackBack (0)

Friday, July 24, 2009

Best Looking Antitrust Agency Head

Posted by D. Daniel Sokol

I have just returned from Chile earlier today.  One issue that came up quite a bit is how many people in the antitrust community are proud of the Fiscalia Nacional Económica not merely for its impressive enforcement activities but because its head Enrique Vergara is one good looking guy.  An academic in Chile asked me to follow up to create a list of the most beautiful agency heads.  I promise that if I can find enough pictures of agency heads, I will do so.

July 24, 2009 | Permalink | Comments (0) | TrackBack (0)

The State of Single-Firm Conduct Policy

Posted by D. Daniel Sokol

The US Chamber has published The State of Single-Firm Conduct Policy.

ABSTRACT: On May 11th, Assistant Attorney General Christine Varney withdrew the Section 2 Report (“Report”) that the previous Administration had issued September 8, 2008. Two months prior to the withdrawal, the Chamber authored a piece encouraging observers on all sides of the single-firm conduct policy debate to take a fresh look at the Report. Little did we know that the title of that essay, Bathwater Out. Now What to Do with Economic Analysis? Antitrust Standards for Unilateral Conduct: Sense and Consensus, would foretell the current state of single-firm conduct policy not only in the United States, but throughout the world.
The Chamber is by no means clairvoyant, as the withdrawal came as no surprise. In her confirmation hearings, while being respectful for the contribution the Report made to the debate, Ms. Varney foreshadowed the withdrawal when she expressed serious concerns with its conclusions.

In announcing the withdrawal, the Department of Justice (“DOJ”) press release complained that the Report argued for “extreme caution” with regard to single-firm enforcement. The day after the withdrawal, Ms. Varney spoke before the Chamber and further explained her decision. She indicated she believed in “the need for a clear Department policy regarding enforcement under Section 2.” She further stated that the goal of the joint DOJ and Federal Trade Commission (“FTC”) year-long examination “was to clarify the analytical framework for assessing the legality of single-firm conduct and to provide guidance to the courts, antitrust counselors, and the business community.” She complimented the work that went into the now withdrawn Report stating, “To its credit, the Report provided a comprehensive evaluation of the history of single-firm enforcement and careful consideration of the risks and benefits of particular enforcement strategies.” But she concluded that the conclusions of the report “missed the mark” and that “the greatest weakness of the Section 2 Report is that it raised many hurdles to Government antitrust enforcement.”

While it was clear that the Administration would not let the Report stand, what remains unclear is what exactly is the single-firm conduct policy of the United States and with respect to that policy what it will advocate internationally.

July 24, 2009 | Permalink | Comments (0) | TrackBack (0)

Thursday, July 23, 2009

Antitrust and the Google Books Settlement: The Problem of Simultaneity

Posted by D. Daniel Sokol

Former 2009 Swope Prize winner Eric Fraser has posted Antitrust and the Google Books Settlement: The Problem of Simultaneity.

ABSTRACT: Google Books represents the latest attempt at the centuries-old goal to build a universal library. In 2004, Google started scanning books from libraries around the world. Although it made copyright licensing agreements with some publishers, it did not obtain permission from each rights-holder before scanning, indexing, and displaying portions of books from the stacks of libraries. Unsurprisingly, authors and publishers sued for copyright violations. Google settled the class action lawsuit in a sweeping agreement that has raised suspicion from librarians, users, and the government. In this paper, I analyze the antitrust and competition issues in the settlement agreement. I find that the simultaneous aspects of agreements and pricing pose serious antitrust problems. The settlement effectively gives Google simultaneous agreements with virtually all the rights-holders to in-copyright American books. It also requires that Google set prices for books simultaneously. In a competitive market, both agreements and pricing would occur independently. Under current law, however, no potential competitor can make agreements with the rights-holders to orphan works. The simultaneity, therefore, concentrates pricing power, leading to cartel pricing (a problem under § 1 of the Sherman Act) and monopolization (a § 2 problem).

July 23, 2009 | Permalink | Comments (0) | TrackBack (0)

Competition in the Health Care Marketplace

Posted by D. Daniel Sokol

Tim Greaney (St. Louis Law) provided a statement for the Senate hearing on Health Care titled Competition in the Health Care Marketplace.

TESTIMONY ABSTRACT: I will first review the federal antitrust enforcement record regarding hospitals, physicians and health insurers and analyze the resulting state of competition in these markets. I will then offer a few thoughts on some future directions for the FTC.

July 23, 2009 | Permalink | Comments (1) | TrackBack (0)

Wednesday, July 22, 2009

Co-operation between National Competition Agencies in the Enforcement of EC Competition Law

Posted by D. Daniel Sokol

Newly in print is Co-operation between National Competition Agencies in the Enforcement of EC Competition Law by Silke Brammer (Law, KU Leuven).

BOOK ABSTRACT: In May 2004, the enforcement of the EC competition rules changed radically. Under Regulation 1/2003, the national competition authorities (NCAs) of all 27 Member States are called upon to actively participate, together with the European Commission, in the enforcement of Articles 81 and 82 EC. In order to ensure the efficient and consistent application of the law, Regulation 1/2003 provides for a number of co-operation mechanisms at the heart of which lies the European Competition Network (ECN). The ECN acts as a common forum for information exchange, co-ordination and discussion. This book provides an in-depth analysis of the rules governing co-operation within the ECN. It is a valuable source for all working in the field of EC competition law: practitioners, company lawyers, competition authority officials and academics.


The author focuses on horizontal co-operation between the NCAs of different Member States. She starts by looking at the arrangements for case allocation, discusses the rules on information exchange and also deals with the consultation procedure prior to the adoption of final NCA decisions. The existing rules are assessed not only in the light of their purpose, ensuring efficiency and consistency in the application of the law, but also reviewed against the requirements of the EU Charter and the European Convention on Human Rights. Particular attention is devoted to issues arising in the event of parallel procedures by several NCAs. This includes the applicability of the ne bis in idem principle and the question which duties of the NCAs result from the loyalty obligation enshrined in Article 10 EC. Finally, the author explores whether the ECN concept of co-operation and networking could be applied more broadly in the context of European integration.

July 22, 2009 | Permalink | Comments (0) | TrackBack (0)

Broken Health Insurance Markets

Posted by D. Daniel Sokol

Last thursday David Balto, a Senior Fellow at the Center of American progress testified before the Senate Commerce Committee on "The Effects of Regulatory neglect on Health Care Consumers."

In that testimony he documents the lack of antitrust and consumer protection enforcement in three key areas of health care middlemen:  insurance, Pharmacy Benefit Managers (PBMs) and Group Purchasing Organizations.  In each, there were no antitrust or consumer protection actions in the past Administration with the result, that the markets have become highly concentrated and plagued with anticompetitive and deceptive conduct.   On health insurance in particular, Balto explains that the fundamental elements for a competitive market are transparency and choice and a lack of conflicts of interest.  In all of these respects, "health insurance markets are clearly broken. Few markets are as concentrated, opaque and complex, and subject to rampant anticompetitive and deceptive conduct. As the health care debate progresses, many advocate for limited reform of the health insurance system. Their belief is that it is a fundamentally sound market and with a little dose of additional regulatory oversight, all the ills of the market will be cured. They could not be more mistaken."   The paper calls for the FTC to realign its enforcement priorities with greater enforcement against health insurers, PBMS and GPOs.

July 22, 2009 | Permalink | Comments (1) | TrackBack (0)


Posted by D. Daniel Sokol

Fred Jenny (OECD, ESSEC, Cour de Cassation) and David Evans (LECG, UCL, University of Chicago) are authors of Trustbusters—Competition Policy Authorities Speak Out.

Competition policy (antitrust in the United States) has grown explosively in the last quarter century. As of 2004, 102 countries—from Albania to Zimbabwe—had competition laws on their books and authorities to enforce them. Together, these countries account for more than 85 percent of the world’s population. But the sheer numbers just begin to define the extent of the revolution that has occurred. Any corporation that wishes to expand—whether inside or outside its geographic borders—must learn the new rules of the game. Just like tennis players who swear when their shots are called out of bounds, enterprises complain when they find themselves in the hard glare of the competition authority, and especially when they are hit with an adverse decision. Love them or hate them though, trustbusters are part of the game of competition. Countries that have embraced that sport for pursuing economic prosperity have almost all recognized that competition needs a referee. Otherwise, the game of competition may be “fixed” through collusion, and firms may seek to win not through the merits but through practices that reduce long-run economic well-being. Antitrust laws have spread around the world precisely because the world has embraced markets as the engine of growth.

But trustbusters are not just referees; they have an institutional interest in preserving and promoting competition. Many antitrust authorities work to educate the public on the importance of competition and how competition advances consumer welfare. Although competition authorities are regulators of markets, they are also advocates of markets. This book, with essays written by 22 global competition authorities representing both developed and developing economies, defines the shape and scope of the expanded two-sided roles these trustbusters are creating inside this competition revolution.

Trustbusters is available either as an eBook or in print, (if ordered as an eBook, the book will be sent as a compressed PDF file by eMail as soon as the order is processed).

July 22, 2009 | Permalink | Comments (0) | TrackBack (0)

Tuesday, July 21, 2009

Institutional Issues in Antitrust

Posted by D. Daniel Sokol

I spent part of today at the Chilean Competition Tribunal.  It hears all antitruscases and has direct appeal to the Chilean Supreme Court.  By law it must have 3 lawyers and two PhD economists.  I am thinking about institutional issues as I prepapre a paper for the ABA Antitrust Section Loyola Conference, which will be held September 11, 2009.  This is very much worth attending.

The ABA Section of Antitrust Law, in conjunction with the Institute for Consumer Antitrust Studies at Loyola University Chicago School of Law, is assembling a first-rate group of leading scholars, current and former enforcement officials, and practitioners to examine the different institutional frameworks for implementing competition law and policy. The institutional frameworks applied by each jurisdiction may be of even greater significance than the substance of the rules they apply, but has received far less attention. The discussion to date of the institutions of antitrust and competition policy has been far less robust than the discussion of the liability rules and other topics in the competition law field.

This conference signals a renewed focus on institutional concerns and seeks to approach this critical issue from a comparative perspective, drawing on the wisdom of key enforcers, observers, and participants from the principal competition jurisdictions from around the world including the United States, the European Union, Canada, Japan, Australia, and others. Among other things, the conference will:

  • Identify and offer a comparative analysis of the frameworks adopted in different jurisdictions for the investigation, review, and adjudication of antitrust issues
  • Analyze the causes and consequences of these differences
  • Consider how the different frameworks operate in theory and practice in reaching sound decisions in an fair and efficient manner
  • Evaluate the need and nature for improvements including both incremental change and sweeping overhauls of the institutions and procedures now in place

The conference will begin with a keynote talk from FTC Commissioner William Kovacic, followed by a series of panels, tentatively scheduled as follows:

Panel 1: Analyzing Competition Regimes

The first panel will focus on the principal models for competition enforcement that have been adopted in various jurisdictions and will discuss the origins of the different approaches to decision-making. Questions to be addressed include: Who makes the ultimate decisions regarding liability and remedy: specialized decision-makers or courts of general jurisdiction? Who decides the facts: specialist courts, generalist courts, sectoral regulators, or competition enforcement agencies? How does the law on the books differ from the law in action in terms of competition law enforcement and institutional arrangements? Are the differences between the principal competition jurisdictions a function of deliberate policy decisions, cultural mores, historical events, or other factors? How do the different approaches reflect other concerns and values such as market integration, protection of domestic producers, empowerment of minority populations, protection of privacy, safety, and the environmental, and other concerns?

Panel 2: Analyzing Competition Law Outcomes

The second panel will focus on the outputs of the different frameworks and enforcement regimes under study. Among other things, the panel will consider whether the various decision-making processes are fair, transparent, predictable, and contribute to an appropriate range of rulings and remedies. Are the regimes appropriate models for other jurisdictions or are they unsuited for jurisdictions that have different substantive objectives? Are differing enforcement regimes necessary for merger and non-merger matters or private versus governmental enforcement?

Panel 3: Comparative Institutional Analysis and Competition Law

In the final panel the panelists will focus on the insights of comparative institutional analysis as applied to the enforcement of competition law. What combination of markets, politics, courts, and bureaucracies are appropriate for the principal competition jurisdictions around the world and what are the common ground, trends, and limitations to aligning those interests in the future?

Each of the panels will be focused on the papers presented by their authors. The other panel participants and conference speakers will offer comments and insights on those papers based on their experience in their own systems and interactions with other jurisdictions. The conference will be structured as a roundtable event with ample opportunity for participants to share ideas and perspectives.

The conference will begin at 9:30 a.m. on Friday September 11, 2009 in the ceremonial courtroom on the 10th floor of the Loyola University Chicago Law Center which is located at 25 E. Pearson, Chicago, IL (corner of Wabash and Pearson). The papers from the conference will be published in a special symposium issue of the Loyola University Chicago Law Journal to be published in early 2010.

We look forward to welcoming you to Chicago, home of the ABA, the Institute for Consumer Antitrust Studies, and Loyola University Chicago School of Law, and engaging with you and your peers in a productive and enjoyable exploration of these challenging issues.

Melanie L. Aitken
Competition Bureau Canada
Gatineau, Quebec, Canada
Conference Co-Chair

Spencer Weber Waller
Loyola University Chicago School of Law
Chicago, IL
Conference Co-Chair

July 21, 2009 | Permalink | Comments (0) | TrackBack (0)

The Broadest Competition-Antitrust Law Curriculum

Posted by D. Daniel Sokol

The winner for LLM programs is UCL.

The courses available in the 2009-10 session are:

  • Competition Law and Intellectual Property Rights: The Regulation of Innovation
     22 weeks from October 2009
  • Competition Law and the State in Europe
    11 wks from January 2010
  • EC Competition Law
    22 wks from October 2009
  • European Competition Law: Enforcement and Comparative Issues
    11 weeks from January 2010
  • International and Comparative Competition Law and Policy
    11 weeks from October 2009
  • Law and Economics of Regulated Industries: Between Competition and Regulation
    11 weeks from January 2010
  • The Role of Economics in Competition Law & Policy
    11 weeks from October 2009
  • US Antitrust & EC competition law: A Comparative Perspective
    22 weeks from October 2009

All courses are accredited with CPD hours by the Solicitors Regulation Authority and the Bar Standards Board.

For more information about the courses, fees and registration, click on the link.

Alternatively, if you would like to talk to UCL about the courses please call:
Lisa Penfold, Events Manager at UCL Law Faculty
020 7679 1514 or email

July 21, 2009 | Permalink | Comments (0) | TrackBack (0)

Monday, July 20, 2009

Competition Law and Policy

Posted by D. Daniel Sokol

Sorry for the lack of the usual number of posts today.  Things should be back to normal tomorrow.  I am in Santiago, Chile where I am teaching in the graduate program in competition policy at the Catholic University of Chile.  It is a mixed group of lawyers and economists and I have found the quality of students to be extremely high.  People have a very sophisticated understanding on economics and doctrine.  I am teaching after students have had econ faculty provide a few weeks of instruction on the economic analyses of competition.  I wish more US and European law schools had such an integrated approach of instruction.  On a far less ambitious leve,l in 2007 I taught a combined JD and econ PhD student class at the University of Wisconsin with my friend and co-author Kyle Stiegert in Applied Econ but here everyone has had significantly more classroom and work experience on competition matters and the quality of discussion is vastly better.

July 20, 2009 | Permalink | Comments (0) | TrackBack (0)

Abuse of Dominance in the Postal Sector – The Contribution of the Guidance Paper on Article 82 Ec

Posted by D. Daniel Sokol

Damien Geradin (Tilburg Law) has posted the interesting Abuse of Dominance in the Postal Sector – The Contribution of the Guidance Paper on Article 82 Ec.

ABSTRACT: On December 15, 2005, the European Commission ('Commission') released a controversial Discussion Paper on Article 82 EC, the provision of the EC Treaty dealing with abuses of a dominant position. This policy document triggered a long and protracted debate not only among competition law experts but also within the Commission itself. The Commission’s plan to distance itself from a 'form-based' approach to the enforcement of Article 82 EC, which sits uneasily with modern economic principles, towards an 'effects-based' approach more in line with such principles was welcomed. Some aspects of the Discussion Paper were criticized nonetheless as being unclear, impracticable, or still overly restrictive. Following the Discussion Paper and the ensuing academic debate on Article 82 EC, the Commission published (on 3 December 2008) its somewhat shorter and more wieldy 'Guidance on the Commission’s Enforcement Priorities in Applying Article 82 EC Treaty to Abusive Exclusionary Conduct by Dominant Undertakings' (“Guidance Paper”), which essentially sets out the Commission’s enforcement priorities with respect to exclusionary abuses. In line with the approach already taken in the fields of Article 81 EC and merger control, the Commission, through its Guidance Paper, has vowed to take a more effects-based approach to exclusionary abuses by dominant undertakings. This is illustrated by the admissibility of familiar economic concepts such as the efficiency defense and the introduction of the 'equally efficient competitor' test. The core premise of Commission intervention now rests on a finding that a dominant undertaking has engaged in conduct that is likely to lead to anticompetitive foreclosure, i.e. exclusionary conduct that is liable to cause consumer harm. Though there is much merit in the commission’s new approach to exclusionary conduct it is open to debate whether it goes far enough. One of the limitations of the Guidance Paper is that it fails to provide for 'safe harbours'. For instance, pricing schemes that do not exclude equally efficient competitors because the price set by the dominant firm is above its costs may nevertheless be considered abusive in some circumstances. Hence, (postal) operators whose prices are above their costs cannot be sure that their pricing is not incompatible with Article 82 EC. The Guidance Paper also contains some lacunae as it does not address for instance exploitative behavior or price discrimination that are particularly contentious issues under EC competition law. Finally, the nature of the Guidance Paper is ambiguous. The Guidance Paper is not intended to be a statement or interpretation of the law, but instead lays out the Commission’s 'enforcement priorities' with respect to Article 82 EC. This raises the issue whether the Commission is bound to apply the principles developed in the Guidance Paper or whether it can apply the more restrictive and formalistic principles contained in the Community courts’ case-law. In the context of the postal sector the advent of the Guidance Paper is particularly propitious in light of the crucial changes that are taking place. The recently promulgated Third Postal Directive ('Postal Directive') provides the legal basis for the full market opening of the postal sector, which is to be accomplished by 31 December 2010. A corollary of the abolition of any remaining, exclusive or special rights is that new possibilities for increased competition in the postal sector will be created. At the same time, however, the removal of the reserved sector is likely to increase the frequency of claims by entrants that incumbent postal operators are engaging in abusive behavior to maintain their market power in liberalized markets. With this in mind, the Guidance Paper provides dominant (postal) undertakings with a set of parameters within which they can assess conduct addressed in it i.e. exclusive dealing, tying and bundling, predatory practices, and refusal to supply. The paper is structured as follows. First, the paper reviews the approach taken by the Guidance Paper with respect to the assessment of dominance. Second, it examines the test that the Guidance Paper intends to apply to determine whether a given practice amounts to anticompetitive foreclosure. Third, it explores the approaches proposed by the Guidance Paper when addressing the various categories of abuse that may be committed by dominant firms, particularly postal operators. Finally, a short conclusion is provided.

July 20, 2009 | Permalink | Comments (0) | TrackBack (0)