Wednesday, February 3, 2010
We are glad to welcome Kevin Coates of DG Competition (and a visiting scholar at NYU School of Law) to review Eleanor Fox's Book Review of The Competition Law of the European Union in Comparative Perspective.
Posted by Kevin Coates
Professor Eleanor Fox is the Walter J. Derenberg Professor of Trade Regulation at NYU School of Law, and is one of the world's leading authorities on comparative antitrust law. Her cases and materials book on "The Competition Law of the European Union in Comparative Perspective" was published by West in 2009.
In 2008 Professor Fox asked me to comment on a late draft of the book, and in return for my very limited attempts to suggest improvements I receive thanks in the introduction. I can take no credit for what was already an excellent text.
The book does not purport to be a general introduction to EU competition law, and Professor Fox provides recommendations for EU texts that would provide such an introduction. Nevertheless anyone who reads and understands this text would be well on the way to understanding the EU system. (Readers should note that since the publication of the book, the entry into force of the Lisbon Treaty has changed - once again - the numbering of the competition rules of the Treaty: Articles 81, 82, 86 and 87 have now become Articles 101, 102, 106 and 107, and references in those articles to the "common market" have been replaced with references to the "internal market".)
The book provides a broad overview of the policy underlying the EU competition rules, drawing on the Treaty provisions, and policy statements found in DG Competition's Annual Report to the European Parliament. It has a short, but useful, discussion of the relationship between the competition objectives and the market integration objectives contained within the Treaty - a wholly necessary explanation if the difference between the EU and US approaches to vertical restraints is to be understood.
It then covers all aspects of EU competition law - anti-competitive agreements and concerted practices, cartels, abuses of dominance, mergers, and state action. For each it draws on the Treaty, court cases, Commission decisions, and policy statements, provides comparative material from the US legal system, and then provides "Notes and Questions".
The selection of cases and the relevant parts of the cases is always pertinent and Professor Fox will save readers much time by having done the hard work of wading through the increasingly long Commission decisions and Court cases and extracting the core issues.
However it is in the "Notes and Questions" that the real value of the book lies. As Giuliano Amato notes in the foreword, "Carefully reading the "Notes and Questions" she has written after each of the cases (or paragraphs) published in this volume should be mandatory not only for students, but also for scholars, judges, officials and practitioners in Europe". I would only add that it should not only be European competition lawyers that undertake this exercise. As a comparative law text, it shines as much light on the US system as it does on that of the EU, with the discussion around the Trinko and Microsoft cases being particularly worth mentioning.
To take just a couple of examples from the Notes and Questions:
- Using the US Steel conduct from the 1950s and 1960s to highlight the likely difference between what constitutes a violation of Section 1 of the Sherman Act and Article 101 of the Treaty
- Why does Europe care about a dominant firm's elimination of a competitor by below cost pricing and the US does not (necessarily)?
- Highlighting the different routes by which EU and US law reach the same end in analysing labour agreements;
- Asking whether there are good reasons why Europe has state aid control and the United States does not?
The value is not only in the comparisons, however. At numerous places throughout the book, Professor Fox asks difficult questions about the reasoning and evidence underlying Commission decisions and court cases. When she asks whether distortion of competition means the same in the State aid rules (Article 107) as it does in the antitrust rules (Article 101), she pins down one of the most important questions of EU competition law.
If I have one quibble it is that the text does not address the substantial enforcement differences in the EU and the US, and the consequence this has for the interpretation of the substantive law. The difference between the EU and US in both the provisions for private enforcement (with the US having opt-out class action lawsuits, contingency fees, extensive discovery, jury trials and treble damages for all infringements) and the consequent amount of private enforcement (almost non-existent in the EU and arguably all-too-existent in the US) are not covered; understandable, of course, in a text focussing on the substantive laws. However as the US antitrust debate shows, the system of enforcement affects the substantive law: the transcript of the US Supreme Court argument in American Needle (available at http://www.supremecourtus.gov/oral_arguments/argument_transcripts/08-661.pdf) makes fascinating reading for a European antitrust lawyer. The Court, faced with a relatively simple question of whether the NFL constitutes a single entity for the purposes of US antitrust spent little time discussing the single entity doctrine as such. Instead, the debate centred on the relative burden that would be placed on the NFL if everything that it did were subject to a rule of reason analysis. Whereas in the EU, the question would likely be confined to an assessment of the "single entity" doctrine under Parker Pen, the US Supreme Court was clearly concerned with enforcement costs.
This, however, is a minor point and should not detract from the fact that every reader would take something of value away from a careful reading of this book. For students, it provides the best comparative overview there is of the similarities in, and differences between, EU and US antitrust law; for practitioners and academics, it asks many of the difficult questions that deserve answers.