Antitrust & Competition Policy Blog

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

Saturday, October 3, 2009

Still time to Register for the Best Vertical Restraints Conference of the Year

Posted by D. Daniel Sokol

Vertical Restraints in EC Competition Law: New Dynamics

Tuesday, October 13, 2009 at 9:00 AM - Wednesday, October 14, 2009 at 1:30 PM (GMT)

Event Details

University College London's (UCL) is pleased to invite you to a 2 day-Conference

Vertical Restraints in EC Competition Law: New Dynamics

Tuesday 13 & Wednesday 14 October 2009
9:00 - 19:30 (day one), 9:00 - 13.30 (day two)
in the UCL Central Campus, Gower Street, London WC1

The reform of EC competition law on vertical restraints has marked the beginning of the process of transformation of EC competition law in the late 1990s, in particular because of the adoption of a more compatible to neoclassical economic theory approach. Almost ten years since the adoption of Regulation 2790/99 and the vertical restraints guidelines, the European Commission has initiated a revision process and has published some proposals at this respect. The aim of this conference would be (a) to understand the process of the reform of EC competition law on verticals, (b) to provide some useful comparative insights, by looking to the most recent developments in US antitrust law on verticals as well as the most recent competition law practice in some Member States’ and selected jurisdictions and (c) to critically assess the proposals of the European Commission, by confronting them to recent economic theory and to legal practice.

The conference is of particular importance to the UCL community as it will honour Valentine Korah, professor emeritus of competition law at UCL and visiting professor to a number of leading academic institutions around the world. Professor Korah is an authority in EC competition law on vertical restraints and has published the leading monographs and commentaries on this topic.
Read about Professor Valentine Korah

The conference will explore the topics of:

  • General aspects of the reform of Vertical Restraints   
  • A retrospective and prospective of the vertical restraints reform
  • Internet distribution and vertical restraints
  • Tying/bundling
  • Resale Price Maintenance
  • Exclusive territories and parallel trade
  • Vertical restraints and the rise of retailer power: competition law and alternatives
  • Vertical restraints in national competition laws and international convergence

The conference gathers leading competition law academics and practitioners in the field of vertical restraints and, more generally, distribution practices from different jurisdictions. It would be particularly appealing to in house lawyers, private practitioners, academics, competition authorities’ officials and post-graduate students.

The conference is accredited with 12 CPD hours.

Download the brochure for this conference



8:30 Registration

Ioannis Lianos, UCL


Philip Collins (OFT)

The Scope of Article 81(1)
Ioannis Lianos (UCL)

The Scope of Article 81(3)
Giorgio Monti (LSE)

The other verticals: relation with Article 82 jurisprudence
John Kallaugher (Latham & Watkins, UCL)

The other verticals: motor vehicle regulation
Gregory Pelecanos (Ballas, Pelecanos & Associates)

10:40 BREAK


Sir Christopher Bellamy (Linklaters LLP)

Valentine Korah (UCL)
Lucas Peeperkorn (European Commission, DG Competition)
Ian Forrester QC (White & Case)
Bill Kovacic (US Federal Trade Commission)
Richard Whish (King’s College London)



Richard Whish (King’s College London)

Denis Waelbroeck (Ashurst, Free University of Brussels)
Stephen Kinsella (Sidley Austin)

Andrea Appella (News Corp.)
Antonio Bavasso (Allen & Overy, UCL)

13:30 LUNCH

  Announcement of the Valentine Korah Prize in Competition Law
Ioannis Lianos (UCL)
Ian Forrester QC (White & Case LLP)


Judge Nicholas Forwood (European Court of First Instance)

Einer Elhauge (Harvard University)
Jorge Padilla (LECG)
Damien Neven (Chief Economist, European Commission)

Cristina Caffarra (CRA International)
Daniel Crane (University of Michigan School of Law, Ann Arbor)



Valentine Korah (UCL)

Lucas Peeperkorn (European Commission, DG Comp.)
Warren Grimes (Southwestern University)
Alison Jones (Kings College London)

Aidan Robertson QC (Brick Court Chambers)
Thibaud Vergé (CREST-LEI (Paris))



Professor Brenda Sufrin (University of Bristol)

Eric Gippini Fournier (European Commission, Legal Service) tbc
Assimakis Komninos (Hellenic Competition Commission / UCL)
Jose Luis Buendia (Garrigues LLP)

Christopher Stothers (Milbank, Tweed, Hadley and McCloy LLP & UCL)
Okeoghene Odudu (University of Cambridge)


Peter Freeman (UK Competition Commission)

Michael Waterson (Warwick University)
Irving Scher (Greenberg Traurig, LLP)
Ariel Ezrachi (Oxford)

Ioannis Lianos (UCL)

11:00 BREAK


Dr Philip Marsden (BIICL, OFT)

UK experience on verticals
Mark Clough QC (Addleshaw Goddard)

Vertical restraints in France

Laurence Idot (University of Paris II Panthéon Assas)

Vertical restraints in Germany

Florian Wagner von Papp (UCL)

Vertical restraints around the world: A comparative perspective

Daniel Sokol (University of Florida Levin College of Law)

International aspects on vertical restraints
Maher Dabbah (Queen Mary, University of London)


October 3, 2009 | Permalink | Comments (0) | TrackBack (0)

Antitrust and the Dynamics of Competition in High-Tech Industries

Posted by D. Daniel Sokol

Antitrust and the Dynamics of Competition in High-Tech Industries

Date: Friday, October 16, 2009
Time: 12 Noon - 2:00 PM
Location: Rayburn House Office Building, B369

The way the government applies antitrust laws can significantly affect innovation and investment, for good or ill.  IT firms have characteristics that make antitrust enforcement more complex, including significant amounts of intangible capital, supply- and demand-side economies of scale, and rapidly changing markets characterized by continuous innovation.  The new administration has signaled a more proactive approach to antitrust enforcement, particularly with respect to high-tech and Internet-based markets.  This Congressional Seminar will examine the proper application of antitrust policy to the IT sector and the direction the new administration is taking.  The conference will focus on the following issues:

  • The effects of antitrust policy on innovation and whether pro-competitive, pro-consumer behavior in high-tech may differ from such behavior in more traditional industries.
  • How antitrust enforcement balances the risks of failing to stop potentially anticompetitive activities against the risks of stifling potentially pro-competitive activities, with specific reference to IT, and whether this balance is changing over time.
  • The evolving role of economics in antitrust enforcement.
  • The effects of multiple antitrust regimes on global companies.

12 noon

Registration and Buffet Lunch


12:20 PM

Panel Discussion


David S. Evans, University of Chicago and University College London

Douglas Melamed, WilmerHale, former Acting Assistant Attorney General, Antitrust Division

Philip J. Weiser, Deputy Assistant Attorney General for International, Policy and Appellate Matters, Antitrust Division

Joshua Wright, George Mason University School of Law

Jonathan Zuck, Association for Competitive Technology

Thomas M. Lenard, Technology Policy Institute (moderator)

To Register: Please use the online form for Antitrust and the Dynamics of Competition in High-Tech Industries, contact Ashley Creel at 202-828-4405 or to register.

The Technology Policy Institute
The Technology Policy Institute is a think tank that focuses on the economics of innovation, technological change, and related regulation in the United States and around the world. TPI produces independent, rigorous research and sponsors educational programs and conferences on major issues affecting information technology and communications policy. TPI is a 501(c)(3) research and educational organization.  More information is available at 

October 3, 2009 | Permalink | Comments (0) | TrackBack (0)

Friday, October 2, 2009

Empirical Evidence on the Role of Non Linear Wholesale Pricing and Vertical Restraints on Cost Pass-Through

Posted by D. Daniel Sokol

Celine Bonnet (Toulouse School of Economics), Pierre Dubois (Toulouse School of Economics) and Sofia B. Villas Boas (Berkeley) address Empirical Evidence on the Role of Non Linear Wholesale Pricing and Vertical Restraints on Cost Pass-Through.

ABSTRACT: How a cost shock is passed through into final consumer prices may relate to nominal price stickiness and rigidities, the existence of non adjustable cost components, strategic mark-up adjustments, or other contract terms along the supply distribution chain. This paper presents a simple framework to assess the potential role of non linear pricing contracts and vertical restraints such as resale price maintenance or wholesale price discrimination in the supply chain in explaining the degree of pass-through from upstream cost shocks in the ground coffee category to downstream retail prices. We do so in the German coffee market where both upstream and downstream firms make pricing decisions allowing for non linear pricing and vertical restraints. Using counterfactual simulations of an upstream coffee cost shock, we find that the existence of resale price maintenance between manufacturers and retailers increases pass through rate by more than 10 points relative to the case when this assumption is not allowed with non linear pricing or when double marginalization along the distribution chain is present. The intuition for our findings is that resale price maintenance restrictions make it less possible for retailers to perform strategic mark-up adjustments when faced with a cost shock. We also find that the larger the simulated cost shocks or the less concentrated upstream sector, and also when faced with less elastic demands, the larger the role of vertical restraints in preventing retailers to perform strategic mark-up adjustments, and thus the higher the pass-through increases.

October 2, 2009 | Permalink | Comments (0) | TrackBack (0)

Entry, Exit, and the Determinants of Market Structure

Posted by D. Daniel Sokol

Timothy Dunne, Federal Reserve Bank of Cleveland, Shawn D. Klimek, U.S. Census Bureau , Mark J. Roberts, Pennsylvania State - Economics, and Daniel Xu, NYU - Economics, describe Entry, Exit, and the Determinants of Market Structure.

ABSTRACT: Market structure is determined by the entry and exit decisions of individual producers. These decisions are driven by expectations of future profits which, in turn, depend on the nature of competition within the market. In this paper we estimate a dynamic, structural model of entry and exit in an oligopolistic industry and use it to quantify the determinants of market structure and long-run firm values for two U.S. service industries, dentists and chiropractors. We find that entry costs faced by potential entrants, fixed costs faced by incumbent producers, and the toughness of short-run price competition are all important determinants of long run firm values and market structure. As the number of firms in the market increases, the value of continuing in the market and the value of entering the market both decline, the probability of exit rises, and the probability of entry declines. The magnitude of these effects differ substantially across markets due to differences in exogenous cost and demand factors and across the dentist and chiropractor industries. Simulations using the estimated model for the dentist industry show that pressure from both potential entrants and incumbent firms discipline long-run profits. We calculate that a seven percent reduction in the mean sunk entry cost would reduce a monopolist firm’s long-run profits by the same amount as if the firm operated in a duopoly.

October 2, 2009 | Permalink | Comments (0) | TrackBack (0)

Reducing Efficiency through Communication in Competitive Coordination Games

Posted by D. Daniel Sokol

Timothy N. Cason (Purdue - Econ), Roman M. Sheremeta (Argyros School of Business and Economics,Chapman University), and Jingjing Zhang (McMaster - Econ) explain Reducing Efficiency through Communication in Competitive Coordination Games.

ABSTRACT: Costless pre-play communication has been found to effectively facilitate coordination and enhance efficiency by increasing individual payoffs in games with Pareto-ranked equilibria. We report an experiment in which two groups compete in a weakest-link contest by expending costly efforts. Allowing group members to communicate before choosing efforts leads to more aggressive competition and greater coordination, but also results in substantially lower payoffs than a control treatment without communication. Our experiment thus provides evidence that communication can reduce efficiency in competitive coordination games. This contrasts sharply with experimental findings from public goods and other coordination games, where communication enhances efficiency and often leads to socially optimal outcomes.

October 2, 2009 | Permalink | Comments (0) | TrackBack (0)

Thursday, October 1, 2009

Trade, Competition, and Efficiency

Posted by D. Daniel Sokol

Kristian Behrens (Université du Québec à Montréal) and Yasusada Murata (Nihon University) write on Trade, Competition, and Efficiency.

ABSTRACT: We present a general equilibrium model of monopolistic competition featuring pro-competitive effects and a competitive limit, and investigate the impact of trade on welfare and efficiency. Contrary to the constant elasticity case, in which all gains from trade are due to product diversity, our model allows for a welfare decomposition between gains from product diversity and gains from pro-competition effects. We then show that the market outcome is not efficient because too many firms operate at an inefficiently small scale by charging prices above marginal costs. Using pro-competitive effects and the competitive limit, we finally illustrate that trade raises efficiency by narrowing the gap between the equilibrium utility and the optimal utility.

October 1, 2009 | Permalink | Comments (0) | TrackBack (0)

Petit on the Move (and with a new blog)

Posted by D. Daniel Sokol

Nicolas Petit (University of Liege - Law) has made the move to full time academia.  He also has a new blog Chilling Competition.

October 1, 2009 | Permalink | Comments (0) | TrackBack (0)

Price Competition and Consumer Confusion

Posted by D. Daniel Sokol

Ioana Chioveanu (UCL - Econ) Jidong Zhou (UCL - Econ) explain Price Competition and Consumer Confusion.

ABSTRACT: This paper proposes a model in which identical sellers of a homogenous product compete in both prices and price frames (i.e., ways to present price information). We model price framing by assuming that firms’ frame choices affect the comparability of their price offers: consumers may fail to compare prices due to frame differentiation, and due to frame complexity. In the symmetric equilibrium the firms randomize over both price frames and prices, and make positive profits. This result is consistent with the observed coexistence of price and price frame dispersion in the market. We also show that (i) the nature of equilibrium depends on which source of consumer confusion dominates, and (ii) an increase in the number of firms can increase industry profits and harm consumers.

October 1, 2009 | Permalink | Comments (0) | TrackBack (0)

Dynamic Competition with Consumer Inertia

Posted by D. Daniel Sokol

Erik Pot, János Flesch, Ronald Peeters, and Dries Vermeulen (all Maastricht University - Econ) describe Dynamic Competition with Consumer Inertia.

ABSTRACT: We study a framework where two duopolists compete repeatedly in prices and where cho-sen prices potentially affect future market shares, but certainly do not affect current sales.This assumption of consumer inertia causes (noncooperative) coordination on high prices only to be possible as an equilibrium for low values of the discount factor. In particular,high discount factors increase opportunism and aggressiveness of competition to such anextent that high prices are no longer sustainable as an equilibrium outcome (not even in trigger strategies). In addition, we find that both monopolization and enduring marketshare and price fluctuations (price wars) can be equilibrium path phenomena without requiring exogenous shocks in market or firm characteristics.

October 1, 2009 | Permalink | Comments (0) | TrackBack (0)

Antitrust and Intellectual Property: Recent Developments in the Pharmaceuticals Sector

Posted by D. Daniel Sokol

Aidan Synnott (Paul, Weiss) & William Michael (Paul, Weiss) express pessimism in government enforcement in their article Antitrust and Intellectual Property: Recent Developments in the Pharmaceuticals Sector.

ABSTRACT: During his campaign for the Presidency, then-Senator Barack Obama promised that he would direct his administration to “reinvigorate antitrust enforcement,” placing special emphasis on competition in health care and pharmaceuticals. Among other things, he promised to “ensure that the law effectively prevents anticompetitive agreements that artificially retard the entry of generic pharmaceuticals onto the market . . . .” That promise has been echoed by President Obama’s choice to head the Federal Trade Commission (“FTC”), Jon Leibowitz, long an outspoken critic of so-called “reverse settlement” or “pay-for-delay” agreements between manufacturers of branded and generic pharmaceuticals. More recently, the Antitrust Division of the Department of Justice (“DOJ”), under new Assistant Attorney General Christine Varney, has taken a significantly more aggressive stance toward such agreements than the DOJ has taken before.

As yet, however, the policy position advanced by the FTC, and now adopted by the DOJ, has not gained acceptance in any federal court of appeals. And recent Supreme Court and Courts of Appeals decisions have had the effect of limiting, rather than expanding, the range of antitrust claims that may be brought against holders of pharmaceutical patents for their conduct in the marketplace—especially when such conduct is unilateral. The practical effect of the agencies’ stated commitment to heightened enforcement in the pharmaceutical sector, therefore, may be limited by their ability to articulate theories of anticompetitive harm that the federal courts deem viable.

October 1, 2009 | Permalink | Comments (0) | TrackBack (0)

Wednesday, September 30, 2009

Reconciling the Opposing Views of Critical Elasticity

Posted by D. Daniel Sokol

Michael Baumann (Economists Incorporated) & Paul Godek (Compass Lexecon) make an attempt at Reconciling the Opposing Views of Critical Elasticity.

ABSTRACT: Market definition is the core of antitrust analysis, and the concepts of “critical elasticity” and “critical loss” have often been applied to the task of defining relevant antitrust markets, in both differentiated-product and homogenous-product scenarios. The critical elasticity is that elasticity of demand that is just high enough to prevent a hypothetical monopolist from profitably increasing price by a threshold “small but significant” amount; critical loss is the fraction of sales lost by the hypothetical monopolist, as implied by the critical elasticity. Evidence that the actual demand elasticity exceeds the critical elasticity indicates that the product in question is not a relevant market.

In recent articles, several researchers have offered an alternative approach to the issue of critical elasticity. Their view is that the traditional application of the concept is flawed and that critical elasticity calculations contain information about actual elasticities of demand. We believe that alternative view to be half wrong. While it offers a misleading interpretation of critical elasticity analysis, the alternative view does reveal a flaw in the conventional approach—a flaw that proponents of the conventional approach have failed to recognize. Here we present a revised and more general critical elasticity model, one that might reconcile the competing arguments. The new model also implies substantially higher critical elasticities than previous models would indicate.

September 30, 2009 | Permalink | Comments (0) | TrackBack (0)

Competition as a Socially Desirable Dilemma - Theory vs. Experimental Evidence

Posted by D. Daniel Sokol

Christoph Engel, Max Planck Institute for Research on Collective Goods describes Competition as a Socially Desirable Dilemma - Theory vs. Experimental Evidence.

ABSTRACT: Cartels are inherently instable. Each cartelist is best off if it breaks the cartel, while the remaining firms remain loyal. If firms interact only once, if products are homogenous, if firms compete in price, and if marginal cost is constant, theory even predicts that strategic interaction forces firms to set the market clearing price. For society, this would be welcome news. Without antitrust intervention, the market outcome maximises welfare. The argument becomes even stronger if the opposite market side has a chance to defend itself; if imposing harm on the opposite market side is salient; if it is clear that cartels are at variance with normative expectations prevalent in society. There is an equally long list of reasons, though, why such optimism might be unwarranted: capacity is limited; interaction is repeated, and the end is uncertain; firms might be willing to run a limited risk of being exploited by their competitors, hoping that the investment pays. This paper explores the question both theoretically and experimentally. In the interest of capitalising on a rich body of experimental findings, and on the concept of conditional cooperation in particular, the paper offers a formal model that interprets oligopoly as a linear public good.

September 30, 2009 | Permalink | Comments (0) | TrackBack (0)

JTC Issues Cease and Desist Order Against Qualcomm

Posted by D. Daniel Sokol

Available in English here.

September 30, 2009 | Permalink | Comments (0) | TrackBack (0)

Horizontal Anticompetitive Agreements

Posted by D. Daniel Sokol

Javier Tapia, UCL Law writes on Horizontal Anticompetitive Agreements (Carácter Anticompetitivo de los Acuerdos Restrictivos de la Competencia).

ABSTRACT: This work (written in Spanish) summarises the most important aspects of the international literature on cartels and coordinated behaviour; provides some insights from Chilean practice; and proposes some policy options. Part I analyses general aspects of coordinated behaviour, from both legal and economic standpoints. Particularly, the conditions of sustainability of the coordination and the social costs of collusion are explained. Part II starts examining the concept of agreement and the means of proof. Then it makes a comparison between the treatment of collusion in Chile and Europe and the US. So far, the treatment of collusive behaviour in Chile - particularly regarding cartels - has been unfortunate in several aspects. However, a recent reform to the law should enable the introduction of a more accurate and modern approach. Crucially, I argue, the introduction of a per se rule is vital. This part ends with a brief description of the adequate level of enforcement. Part III assesses the main aspects of tacit collusion, with particular focus on parallel behaviour and information exchanges. Finally, the conclusion stresses the need for a pragmatic approach: to focus enforcement only on explicit agreements - at least at this early stage of development of the new rules introduced by the mentioned legal reform.

September 30, 2009 | Permalink | Comments (0) | TrackBack (0)

Article 81 EC and Public Policy

Posted by D. Daniel Sokol

Townleycfromcompetition140x160 Christopher Townley (King's College, London - Law) has a new book out in print Article 81 EC and Public Policy.  This is an important contribution to Article 81 analysis.

BOOK ABSTRACT: This book discusses the role of public policy in Article 81 of the EC Treaty. The Commission, and recently the Court of First Instance have said that the sole objective of Article 81 EC is consumer welfare. Many competition lawyers support this view. Writing in a crisp, plain style, Townley demonstrates that public policy considerations are still relevant in that provision. He also suggests how and where they should be considered.

The book explains how some of the most complex competition law cases can be understood and offers a framework for those fighting or deciding such cases in the future. As such, it will be of interest to European competition lawyers, both academics and practitioners; as well as students, seeking a deeper understanding of how the European competition rules work and how they interact both with European Union and Member State public policy goals.

September 30, 2009 | Permalink | Comments (0) | TrackBack (0)

Upstream Horizontal Mergers and Efficiency Gains

Posted by D. Daniel Sokol

Chrysovalantou Milliou, Athens University of Economics and Business and Apostolis Pavlou address Upstream Horizontal Mergers and Efficiency Gains.

ABSTRACT: We study upstream horizontal mergers and their potential efficiency gains. We show that an upstream horizontal merger can give rise to two efficiency-enhancing effects when firms trade through two-part tariffs. It increases R&D investments and decreases wholesale prices when downstream competition is not too strong. Examining whether the merger’s potential efficiency gains can overcome its anti-competitive effects in terms of welfare, we show that when firms merge usually both of the above mentioned efficiencies are realized and they are passed on to consumers. This holds to a lesser extend when firms trade through linear contracts.

September 30, 2009 | Permalink | Comments (0) | TrackBack (0)

Tuesday, September 29, 2009

Identifying and Remedying Exclusionary Conduct: Microsoft, the DOJ Section 2 Report, and the New Administration

Posted by D. Daniel Sokol

Page_big My colleague Bill Page has posted Identifying and Remedying Exclusionary Conduct: Microsoft, the DOJ Section 2 Report, and the New Administration.

ABSTRACT: The Department of Justice’s Section 2 Report considered in great detail how courts should best go about identifying exclusionary conduct and how they should best remedy that kind of conduct once they found it. Even though the new Assistant Attorney General has now withdrawn the Report as an official statement of Antitrust Division policy, the questions the Report addressed remain for the new administration. In this essay, I will comment on two subsidiary but nonetheless critical subjects that the DOJ addressed in the Report: general standards of exclusion and affirmative-obligation remedies. In both instances, my observations will draw on the experience of United States v. Microsoft, the DOJ’s last and still pending monopolization case.

September 29, 2009 | Permalink | Comments (0) | TrackBack (0)

Antitrust Federalism: Enhancing the Federal-State Relationship

Posted by D. Daniel Sokol

Antitrust Federalism: Enhancing the Federal-State Relationship

Wednesday, Oct. 7, 2009, 9 a.m. - 12:30 p.m.

  “Antitrust Federalism: Enhancing the Federal-State Relationship,” a conference that will outline new measures the government is taking to strengthen its antitrust laws, and how agencies can collaborate more effectively in joint law enforcement efforts under the Obama administration. In the past, federal and state officials had a contentious relationship, resulting in missed opportunities to make antitrust enforcement more efficient and effective. Now, at a time when resources are at a premium, there is a greater need for state and federal governments to cooperate with each other and coordinate efforts.

The conference is being hosted by the Columbia Law School National State Attorneys General Program and the National Association of Attorneys General (NAAG).

Christine A. Varney, Assistant Attorney General, Antitrust Department, DOJ
Jon D. Leibowitz, Chairman, Federal Trade Commission
Richard Cordray, Attorney General of Ohio, Co-Chair, NAAG Antitrust Committee
James Tierney, Director, National State Attorneys General Program, Columbia Law School

Columbia University
Faculty House
64 Morningside Drive
New York, NY 10027

September 29, 2009 | Permalink | Comments (0) | TrackBack (0)

Administrative Monopoly and the Anti-Monopoly Law: An Examination Of the Debate in China

Posted by D. Daniel Sokol

Gordon Y.M. Chan, Department of Law & Business, Hong Kong Shue Yan University analyzes Administrative Monopoly and the Anti-Monopoly Law: An Examination Of the Debate in China.

ABSTRACT: After more than a decade of preparation, China finally passed the Anti-Monopoly Law (AML) on August 30, 2007. This paper examines the debate over whether or not administrative monopoly should be included in the ambit of the AML, which took place throughout the drafting process of this new law. Administrative monopoly refers to the abusive use of administrative power by government agencies to engage in monopolistic activities. Owing to the administrative nature of this type of monopoly, the intent to regulate it by an economic law, such as the AML, has stirred up much controversy. Having analyzed the arguments both in support of and in opposition to the inclusion, this paper suggests the need to adopt a more comprehensive scheme in tackling administrative monopoly. Also, the enforcement mechanism of the AML will have to be strengthened in order to prevent this new law from degenerating into ‘a toothless tiger’. Furthermore, the competition law regime of China will benefit from in-depth research in overseas anti-monopoly practices. In particular, the experiences of the former socialist states in Europe should be taken into account, given that they are similarly undergoing the transition from a planned economy to a market economy.

September 29, 2009 | Permalink | Comments (0) | TrackBack (0)

The Energy Antitrust Handbook, Second edition

Posted by D. Daniel Sokol

The ABA has come out with the second edition of the Energy Antitrust Handbook.

This Second edition of the Energy Antitrust Handbook presents a guide to an industry of increasing importance to the U.S. economy. It is written to assist energy, regulatory, and antitrust lawyers in understanding the multilayered complexity of this field by providing a basic background on antitrust issues in the energy industry. The principal focus of the first edition of this handbook was on electricity and natural gas, this edition has been broadened in scope to include more sectors of the energy industry.

By reading this book, lawyers already familiar with antitrust law will gain an understanding of related energy issues, the market structure, and the application of the antitrust laws to these industries. Lawyers and executives already familiar with the energy industry, but not with antitrust law, will find this book provides an understanding of the antitrust laws applicable to energy.

The energy industry has been at the center of the development of the antitrust laws. In particular, the oil industry has been the source of many seminal antitrust cases. The electric and natural gas industries also have contributed several seminal cases, but have been subject to substantial if not complete antitrust immunity in light of pervasive federal and state regulation until the introduction of competition in the late 1980s and 1990s. Although the electric and natural gas industries continue to be subject to less pervasive regulation, new antitrust issues and concerns about "market manipulation" have become the focus of scrutiny in the electric, natural gas, and petroleum industries.

The nine chapters in this handbook cover a range of issues as follows:

--Chapter I provides an introduction to the energy industry.

--Chapter II is an overview of the history of regulation and deregulation of natural gas and electricity.

--Chapter III provides a discussion of the antitrust immunities and defenses available in many energy cases, including the filed rate doctrine, state action immunity, Noerr-Pennington immunity, and implied repeal.

--Chapter IV discusses mergers, acquisitions, divestitures and related issues. Although FERC formally adheres to the DOJ/FTC Merger Guidelines, its application of those guidelines to the electric power and gas industries is unique.

--Chapter V focuses on joint ventures and joint action by competitors, and includes a discussion of the DOJ/FTC Competitor Collaborations Guidelines. Because recent efforts to accelerate the pace of deregulation are frequently based on the establishment of federally encouraged joint ventures [for example, Independent System Operators (ISOs)] this chapter is of particular importance to both energy and antitrust lawyers.

--Chapter VI focuses on monopolization issues. Because the electric and gas industries have moved toward deregulation, a discussion of conduct designed to maintain or acquire monopoly power is particularly relevant. Much of the electric power/antitrust discussion on essential facilities is contained in this section.

--Chapter VII deals with pricing issues, including agreements among competitors affecting price, such as price fixing, and single firm pricing conduct.

--Chapter VIII discusses issues related to nonprice agreements, including joint conduct to exclude competition, territorial agreements, and exclusive dealing arrangements.

--Chapter IX addresses the market manipulation rules that are the subject of new and vigorous debate at the agencies.

While each of these chapters discusses standard antitrust analyses, the application to these industries is often unusual because of both regulated and unregulated aspects to these practices.

September 29, 2009 | Permalink | Comments (0) | TrackBack (0)