Antitrust & Competition Policy Blog

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

A Member of the Law Professor Blogs Network

Saturday, April 3, 2010

Consumers’ Participation Rights in Competition Law Procedures

Posted by D. Daniel Sokol

Consumers’ Participation Rights in

Competition Law Procedures

Arrival and Registration

16 April 2010

University of Amsterdam, Doelenzaal

Singel 425, 1012 WP Amsterdam

Organized by the Amsterdam Centre for European Law and Governance (ACELG)

13.30 – 13.45

13.45 – 13.55

Opening

13.55 – 14.10

Introduction

Who are the clients of competition law?

Prof. dr. Gareth Davies, Vrije Universiteit, Amsterdam

14.10 – 15.10

Session 1: Academic perspectives

Origins of the procedures and future developments

Prof. Lorenzo Federico Pace, University of Molise, Italy

The procedural rights of participants and the structure of procedures

Dr. Joana Mendes, ACELG, University of Amsterdam

Dr. Kati Cseres, ACELG, University of Amsterdam

Discussion

15.10 – 15.30

Coffee Break

15.30 – 17.00

Session 2: Practitioners’ perspectives

The rationale for the different categories of participants – a view from the Commission

Mr. Michael Albers, Hearing Officer, European Commission

An assessment of the present framework – the consumers’ perspectives

Mr. David M. Ortega, BEUC / OCU - Spain

An assessment of the present framework – the business perspective

Mr. Onno Brouwer, Freshfields Bruckhaus Deringer LLP, The Netherlands

Discussion

17.00 – 17.15

Closing

17.15 – 18.00

Reception

April 3, 2010 | Permalink | Comments (0) | TrackBack (0)

Friday, April 2, 2010

Striking an Efficient Balance: Making Sense of Antitrust Standing in Class Action Certification Motions

Posted by D. Daniel Sokol

Kelly J. Bozanic, Pennsylvania State University - Dickinson School of Law makes the case for Striking an Efficient Balance: Making Sense of Antitrust Standing in Class Action Certification Motions.

ABSTRACT: Class actions are powerful litigation devices, especially in antitrust cases. Plaintiffs who otherwise would not have the economic incentive to pursue judicial redress are vested with status as equal players in the commercial marketplace. The aims of both the antitrust laws and Rule 23(b)(3) of the Federal Rules of Civil Procedure are served through class actions, yet class actions also bear the potential of negatively impacting the consuming public. This is so, because district court judges considering certification motions face seemingly contradictory standards when it comes to certifying an antitrust class. As a result, plaintiff classes are often given an unfair advantage in bargaining position through an improper grant of certification. This article clarifies the jurisprudential policies which animate Rule 23(b)(3) and § 4 of the Clayton Act for the purpose of understanding what is required of a district court judge in class action certification. This article contends that the district court judge is a fiduciary who must fairly preserve the bargaining positions of both parties. In so doing, the judge serves the greater population by ensuring the optimum level of antitrust enforcement, and thereby, the ultimate aim of the antitrust laws is upheld: protecting consumer welfare by ensuring a robustly competitive marketplace.

April 2, 2010 | Permalink | Comments (0) | TrackBack (0)

Dynamic Changes in Market Structure and Competition in the Corn and Soybean Seed Sector

Posted by D. Daniel Sokol

William W. Wilson and Bruce Dahl (both North Dakota State Ag Econ) have some empirical findings on Dynamic Changes in Market Structure and Competition in the Corn and Soybean Seed Sector .

ABSTRACT: The purpose of this paper is to analyze the dynamics of R&D investments, and the structure of the seed distribution sector using novel data sets that have not been used before to describe competition in these industries. The results describe four sets of issues of particular importance. One is that while all agbiotechology firms have increased their R&D expenditures, there have been sharp differences in the scope of this spending. Most important is that this has spawned the growth in what is now referred as “seeds and traits.” Second, a large number of future traits will be commercialized in the coming years. A third set of results indicates that one firm grew its market share by 14% and a portion of this growth has been through acquisition. The other three majors lost market share, but the ISC (independent seed companies) grew by 10%. At the crop reporting district level, the industry concentration ratios for the four largest firms (CR4) in most regions are .5‐.7. Finally, farmers purchased corn and soybean seed from 4‐7 different companies in most crop reporting districts (CRD) and up to 20 or more companies in the larger producing regions.

April 2, 2010 | Permalink | Comments (0) | TrackBack (0)

Empagran - Empire Building or Judicial Modesty?

Posted by D. Daniel Sokol

Paul B. Stephan, University of Virginia School of Law asks Empagran - Empire Building or Judicial Modesty?

ABSTRACT: This paper, which will appear in a book on the Supreme Court and International Law, comments on the contribution of Professor Ralf Michaels on F. Hoffman-LaRoche, Ltd. v. Empagran S.A. Without quarreling with Professor Michael’s insightful and creative analysis, I offer an alternative reading of the decision. I locate it within a four-decade tradition of growing skepticism about the value of civil litigation brought by private persons as a means of vindicating public interests.

April 2, 2010 | Permalink | Comments (0) | TrackBack (0)

Payment Cards Pricing Patterns: The Role of Antitrust and Regulatory Authorities

Posted by D. Daniel Sokol

Alberto Heimler (Scuola superiore della pubblica amministrazione) has posted Payment Cards Pricing Patterns: The Role of Antitrust and Regulatory Authorities.

ABSTRACT: Antitrust enforcers and regulators are increasingly worried that interchange fees in four-party systems, more than being an instrument for addressing usage externality, had become a collusionary device, setting a floor under which the charges could not go. Competition is not working effectively in card payment systems. The reason is that with the non discrimination rule in place, the cost of payment services is transferred by merchants to all buyers, not just to cardholders. As a result, cardholders (that do not pay for the cost of their choice) tend to use the payment instrument that offers the highest private benefits to them (the one with the better reward system), often the most costly. In turn, issuers tend to offer to consumers the cards that provide the highest interchange fee. This paper shows that eliminating the interchange fee and allowing for both issuers and acquirers to charge cardholders and merchants respectively may lead to the internalization of usage externalities and to markets for payment services to operate more effectively. Furthermore the elimination of the no-discrimination rule may also discipline three party systems, as the Australian example shows.

April 2, 2010 | Permalink | Comments (0) | TrackBack (0)

Thursday, April 1, 2010

Antitrust Track at the ABA International Spring Meeting

Posted by D. Daniel Sokol

For those of you who are international focused and want a fun conference to attend in New York in April, there are a series of antitrust programs in the ABA International Section Spring Meeting, April 13-17 at the Grand Hyatt in New York.

See Download 2010 Spring Meeting Antitrust Track (4)

April 1, 2010 | Permalink | Comments (0) | TrackBack (0)

Predation Under Perfect Information

Posted by D. Daniel Sokol

Cédric Argenton, Tilburg Law and Economics Center (TILEC), Tilburg University - Center and Faculty of Economics and Business Administration models Predation Under Perfect Information.

ABSTRACT: In an oligopoly configuration characterized by high barriers to (re-)entry, a finite horizon, perfect information about demand and costs and the presence of three identical firms, we show that two of them (the predators) can choose to charge an initial price that is so low that the third (the prey) decides to exit immediately, after which the predators can enjoy higher profits, even if they do not raise their price. Predatory prices are thus observed on the equilibrium path and the predators end up earning more than in the best Bertrand (or even, collusive) equilibrium with three firms.

April 1, 2010 | Permalink | Comments (0) | TrackBack (0)

A Shared Vision for American Agricultural Markets

Posted by D. Daniel Sokol

The DOJ has posted A Shared Vision for American Agricultural Markets - Remarks as Prepared for the Opening of the Department of Justice and Department of Agriculture Joint Workshops by Assistant Attorney General Christine A. Varney on March 12, 2010.

April 1, 2010 | Permalink | Comments (0) | TrackBack (0)

The Indirect Effects of Changes in Product Market Competition

Posted by D. Daniel Sokol

Mary J. Becker, University of Pittsburgh - Katz Graduate School of Business and Shawn E. Thomas, University of Pittsburgh - Finance address The Indirect Effects of Changes in Product Market Competition.

ABSTRACT: We investigate the timing, magnitude, and direction of the relation between changes in product market competition across vertically related industries over the period 1978-2008. We document that changes in customer industry concentration are positively related to subsequent changes in supplier industry concentration consistent with changes in customer industry concentration prompting changes in supplier industry concentration. We find evidence that increased concentration in customer and supplier industries, perhaps reflecting countervailing power motives for horizontal mergers and acquisitions, explain in part the observed positive relation; however, we also find robust evidence that decreases in concentration perhaps reflecting entry waves in vertically related industries are also important determinants of the observed relation. Our results have implications for those papers that examine the association between the level of product market competition and important corporate finance policy choices and asset pricing.

April 1, 2010 | Permalink | Comments (0) | TrackBack (0)

Antitrust Developments in Communications & Digital Technology Industries

Posted by D. Daniel Sokol

The new Icarus newletter of the ABA Antitrust Communications & Digital Technology Industries Committee is out.  The table of contents include: 

That 70’s Show?: The New DOJ Investigation of IBM
Sean P. Pugh
Dechert LLP

Bilski, Methods, and Patents for the Telecommunications Industry
Paul Ackerman, Justin McCarthy, and Alicia Mills Dorsey & Whitney LLP 

The Intel-AMD Antitrust Suits: Economic Issues and Implications
Lona Fowdur
Economists Incorporated 

Recent Developments
Caeli Higney
Gibson, Dunn & Crutcher LLP

April 1, 2010 | Permalink | Comments (0) | TrackBack (0)

MARGIN–CONCENTRATION ANALYSIS IN THE UK GROCERIES INQUIRY

Posted by D. Daniel Sokol

Jerry A. Hausman (MIT - Econ) and David W.G. Parker (Frontier Economics) analyze MARGIN–CONCENTRATION ANALYSIS IN THE UK GROCERIES INQUIRY.

ABSTRACT: The UK Competition Commission's recent inquiry into the Groceries sector made the unusual recommendation that organic growth by large incumbents in concentrated areas be prohibited. The key support for this recommendation came from an econometric analysis of the relationship between margins and concentration. We describe the analysis and demonstrate that it suffers from material flaws that cast doubt on the validity of the conclusions drawn from it, and thus on the remedy itself. We identify issues around the nature of debate between investigated parties and the UK authorities on technical issues and make some suggestions for changes to processes.

April 1, 2010 | Permalink | Comments (0) | TrackBack (0)

Wednesday, March 31, 2010

Antitrust and Innovation Symposium, Stanford Law May 20-21, 2010

Postred by D. Daniel Sokol

Antitrust and Innovation Symposium

Stanford School of Law

Stanford, CA

May 20-21, 2010

About the Symposium

The ABA Section of Antitrust Law and Stanford Law School have assembled a first-rate group of leading scholars, current and former enforcement officials, and practitioners to examine the role of antitrust policy in fostering innovation. Particular focus will be placed on discussion and analysis of (1) the extent to which competition policy affects the direction and rate of innovation, and (2) the ways in which current antitrust policies in the United States and other jurisdictions are likely to further or hinder the widely-accepted policy goal of encouraging innovation and dynamic competition.

The Antitrust and Innovation Symposium will be a one and one-half day event with five panels, each exploring different aspects of the above-described topics.

The Symposium will include key-note speeches by Professor Herbert Hovenkamp and Microsoft General Counsel Brad Smith. In addition, the Symposium will include the following five panels.

The conference will begin at 3:00 p.m. on Thursday, May 20, 2010 at Stanford Law School, and will continue all day Friday, May 21, 2010 (from 9:00 a.m. to 5:00 p.m.). We look forward to welcoming you to the Silicon Valley, California – the birthplace of so much innovation and so many leading technology companies – and engaging with you and your peers in a productive and enjoyable exploration of these challenging issues.


Arthur J. Burke
Davis Polk & Wardwell
Menlo Park, CA
Conference Co-chair

Mark A. Lemley
Durie Tangri LLP
San Francisco, CA
Conference Co-chair

Richard Rapp
NERA Economic Consulting

March 31, 2010 | Permalink | Comments (0) | TrackBack (0)

Assessing the Link between Standard Setting and Market Power

Posted by D. Daniel Sokol

Anne Layne-Farrar, LECG and A. Jorge Padilla, LECG explain Assessing the Link between Standard Setting and Market Power.

ABSTRACT: Some policymakers, courts, and academics have expressed concerns that when a firm’s patents are incorporated into a standard, the inclusion can create market power for the patent holders that can then be abused when the standard is commercialized. This paper offers a critical assessment of that proposition. Our analysis has two aims: first, to better understand exactly how an SSO might confer market power on included patents and second, to move closer to an empirical understanding of the market power proposition. We create a dataset of patents named to voluntary standard setting organizations, as well as the patent pools that sometimes develop around such standards, with the goal of providing some suggestive measurements of the effect standardization might have on market power. As it is extremely difficult to measure market power directly, we rely on proxies capturing a patent’s importance or value. We find that some SSOs do appear to enhance some included patents’ importance, but most do not. Moreover, the effects change over time, across standards, and across patents. Thus, we conclude that, on average, inclusion in an SSO tends to enhance a patent’s value, but for any particular patent named to a particular standard a positive effect is not inevitable. Instead, a broad range of effects is possible, some even negative but most equal to zero.

March 31, 2010 | Permalink | Comments (0) | TrackBack (0)

The Coolest Antitrust Seminar of Spring 2010

Posted by D. Daniel Sokol

It has to be Hanno Kaiser (Berkeley Law) and his Antitrust and the Internet class.  The syllabus is available here.

March 31, 2010 | Permalink | Comments (0) | TrackBack (0)

Microsoft On Trial: Legal and Economic Analysis of a Transatlantic Antitrust Case

Posted by D. Daniel Sokol

Luca Rubini, University of Birmingham - Law has assembled a group of experts to discuss Microsoft On Trial: Legal and Economic Analysis of a Transatlantic Antitrust Case in a new edited book.

BOOK ABSTRACT: Microsoft on Trial analyses the antitrust cases that have involved Microsoft in both sides of the Atlantic and offers a thorough and timely discussion on the regulation of unilateral behaviour in a topical sector.

Contributors include: S. Anderman, A. Andreangeli, M. Baldauf, N. Banasevic, J.-F. Bellis, N. Economides, J. Fejø, I.S. Forrester QC, E.M. Fox, M.J. Gil-Molto, P. Hellström, C. Jackson, T. Kasten, I. Lianos, R.J.R. Peritz, C. Petrucci, D. Ridyard, L. Rubini, B. Vesterdorf, A. Walsh

March 31, 2010 | Permalink | Comments (0) | TrackBack (0)

Google is Under Attack from Competition (ie, the market)

Posted by D. Daniel Sokol

Facebook has overtaken Google as the most popular US website.  I guess it means that Google might not be so dominant after all - not as if antitrust enforcers in the US and Europe seem to be listening.

March 31, 2010 | Permalink | Comments (0) | TrackBack (0)

Innovation, Competition And Consumer Welfare In Intellectual Property Law

Posted by D. Daniel Sokol

Gustavo Ghidini, Professor of Intellectual Property and Competition Law, University of Milan and Director, Observatory on Intellectual Property, Competition and Communications Law, LUISS Guido Carli University has a new book on Innovation, Competition And Consumer Welfare In Intellectual Property Law.

BOOK ABSTRACT: Contents: 1. Introduction. The Basic Paradigms and Constitutional Framework of Intellectual Property Law 2. Patent Protection of Innovations: A Monopoly with Pro-Competitive Antibodies 3. From Art to Technology: The Expansion of Copyright 4. The Distinguishing Function and Advertising Value of the Trademark 5. Intellectual Property and Regulation(s) of Competition Appendix.

March 31, 2010 | Permalink | Comments (0) | TrackBack (0)

The Development Of Competition Law: Global Perspectives

Posted by D. Daniel Sokol

Roger Zäch and Andreas Heinemann, Europa Institut, University of Zurich and Andreas Kellerhals, Europa Institut, University of Zurich, Switzerland and Member, Swiss Competition Commission, have edited The Development Of Competition Law: Global Perspectives.

BOOK ABSTRACT: Competition law has changed substantially since 1990. The worldwide tendency toward market-based economic systems has induced many countries to adopt competition rules. This innovative book discusses the global character of competition law focussing on three interrelated perspectives. Firstly the impact of economics on global competition policy, secondly the competition law experience in selected countries (Japan, India, China, Czech Republic, Brazil) and how the law has adapted to the political, economic and cultural environment. Thirdly, perspectives on the internationalisation of competition policy and an apparent increasing degree of convergence are explored.

Contents:

Preface
Roger Zäch, Andreas Heinemann and Andreas Kellerhals

PART I: THE METHODOLOGICAL FOUNDATIONS OF COMPETITION LAW
1. EC Competition Law: The Dominance of Economic Analysis?
Giorgio Monti

2. Fifteen Years of Supreme Court Antitrust Jurisprudence: The Defendant Always Wins
Warren S. Grimes

3. Freedom to Compete or Consumer Welfare: The Goal of Competition Law According to Constitutional Law
Roger Zäch and Adrian Künzler

PART II: THE DIVERSITY OF COMPETITION LAW REGIMES
4. The Development of Competition Law for the Last 15 Years in Japan: Progress or Setback?
Iwakazu Takahashi

5. Metamorphosis of Indian Competition Law
Srinivasan Chakravarthy

6. Thirty Years of PRC Anti-monopoly Law under ‘State-Market’ Yardstick: From Retrospective and Prospective Viewpoints
Yong Huang and Shan Jiang

7. Transition Countries Facing Transitory Competition Rules: ‘Moving Shooter’ Taking Aim at a ‘Moving Target’
Josef Bejcek

8. Cartel Deterrence and Settlements: The Brazilian Experience
Paulo Furquim de Azevedo and Alexandre Lauri Henriksen

PART III: PERSPECTIVES
9. The Development of the World Economy and Competition Law
Rainer Geiger

10. Is Criminalisation of EU Competition Law the Answer?
Wouter P.J. Wils

11. Private Enforcement in Europe
Andreas Heinemann

12. Competition Law de Lege Ferenda
Daniel Zimmer

March 31, 2010 | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 30, 2010

Trade Liberalization, Competition and Growth

Posted by D. Daniel Sokol

Omar Licandro (IAE) and Antonio Navas Ruiz (Universidad Autonoma de Madrid) have a new working paper on Trade Liberalization, Competition and Growth.

ABSTRACT: Increasing evidence support the claim that international trade enhances innovation and productivity growth through an increase in competition. This paper develops a two-country endogenous growth model, with firm specific R&D and a continuum of oligopolistic sectors under Cournot competition to provide a theoretical support to this claim. Since countries are assumed to produce the same set of varieties, trade openness makes markets more competitive, reducing prices and increasing quantities. Under Cournot competition, trade is pro-competitive. Since firms undertake cost reducing innovations, the increase in production induced by a more competitive market push firms to innovate more. Consequently, a reduction on trade barriers enhances growth by reducing domestic firm's market power.

March 30, 2010 | Permalink | Comments (0) | TrackBack (0)

Key Features of 2009 Cartel Cases

Posted by D. Daniel Sokol

Romano Subiotto, Georgina Eclair-Heath and Itai Rabinovici (Clearly Gottlieb) explain the Key Features of 2009 Cartel Cases.

ABSTRACT: Key points

  • In 2009, the European courts have generally refrained from annuling cartel decisions adopted by the European Commission.
  • They have accepted, in most cases, the fine imposed by the commission.
  • They have confrmed that fines can be calculated on the basis of the turn over realised by mother companies.

 


The European Court of Justice (ECJ) has annulled only a handful of European Commission Article 101 TFEU (ex Article 81 EC Treaty) decisions in 2009. Indeed, it has seemingly only done so where there has been a clear violation of an undertaking's fundamental rights, such as the right to equal treatment or the right to be heard.


March 30, 2010 | Permalink | Comments (0) | TrackBack (0)