Antitrust & Competition Policy Blog

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

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Friday, December 21, 2012

100 Years of Standard Oil Antitrust Symposium

Posted by D. Daniel Sokol

The Southern California Law review has put up on its website the great symposium 100 Years of Standard Oil Antitrust Symposium.

Volume 85 March 2012 Number 3

 

100 Years of Standard Oil Antitrust Symposium

 

429-450

Antitrust Energy

Barak Orbach & D. Daniel Sokol

 

451-458

Antitrust and Business History

Margaret C. Levenstein

 

459-498

The "Hub-and-Spoke" Conspiracy that Created the Standard Oil Monopoly

Benjamin Klein

 

499-558

Rethinking the Economic Basis of the Standard Oil Refining Monopoly: Dominance Against Competing Cartels

George L. Priest

 

559-572

Were Standard Oil's Rebates and Drawbacks Cost Justified?

Daniel A. Crane

 

573-604

Revisiting the Revisionist History of Standard Oil

Christopher R. Leslie

 

605-656

The Antitrust Curse of Bigness

Barak Orbach & Grace Campbell Rebling

 

657-688

Standard Oil and U.S. Steel: Predation and Collusion in the Law of Monopolization and Mergers

William H. Page

 

689-732

The Strategic Use of Public and Private Litigation in Antitrust as Business Strategy

D. Daniel Sokol

 

733-782

Moving Beyond Caricature and Characterization: The Modern Rule of Reason in Practice

Andrew I. Gavil

 

783-814

Standard Oil as Lochner's Trojan Horse

Alan J. Meese

 

815-842

Remedies for Monopolization from Standard Oil to Microsoft and Intel: The Changing Nature of Monopoly Law from Elimination of Market Power to Regulation of Its Use

Peter C. Carstensen

 

843-916

The Long Shadow of Standard Oil: Policy, Petroleum, and Politics at the Federal Trade Commission

Timothy J. Muris & Bilal K. Sayyed

 

Responses

Michael Reksulak & William F. Shughart II, Tarring the Trust: The Political Economy of Standard Oil, 85 S. Cal. L. Rev. Postscript 23 (2012).

Maurice E. Stucke, Occupy Wall Street and Antitrust, 85 S. Cal. L. Rev. Postscript 33 (2012).

Abraham L. Wickelgren, Determining the Optimal Antitrust Standard: How to Think About Per Se Versus Rule of Reason, 85 S. Cal. L. Rev. Postscript 52 (2012).

Joshua D. Wright, What Would Predatory Pricing Be Without John McGee? A Reply to Professor Leslie, 85 S. Cal. L. Rev. Postscript 60 (2012).

December 21, 2012 | Permalink | Comments (0) | TrackBack (0)

New York Bar Foundation is accepting grant applications for the 2013 Antitrust Section Law Student Fellowship

Posted by D. Daniel Sokol

THE NEW YORK BAR FOUNDATION

 2013 ANTITRUST SECTION

Law Student fellowship

 

The New York Bar Foundation is pleased to announce the 2013 Antitrust Section Law Student Fellowship, which has been established by the Foundation through gifts from the Antitrust Section of the New York State Bar Association.  The Fellowship will be awarded to a current first or second year law student to work on antitrust and related matters in the public sector in the State of New York during the Summer of 2013.

Fellowship Program Goals

 

Provide law students an opportunity to experience antitrust practice during the summer after their first year of law school and to increase the representation of lawyers from a diverse range of backgrounds in the practice of antitrust law in New York.  The ultimate goal of the Fellowship is to forge relationships among antitrust practitioners throughout the State of New York and foster greater diversity in the antitrust bar.  Through the Fellowship, a student will be provided a meaningful and appropriately supervised work experience in the New York Office of New York Attorney General, Antitrust Bureau; the Federal Trade Commission, Northeast Region; or the Department of Justice Antitrust Division, New York Field Office.

 

The Fellowship

 

  1. The Fellowship, valued at $6,000, will be awarded to one (1) student to spend the summer of 2013 (10 weeks) working on antitrust matters in the New York Office of New York Attorney General, Antitrust Bureau; Federal Trade Commission, Northeast Region; or Department of Justice Antitrust Division, New York Field Office.
  2. The Fellow will be a guest member of the NYSBA Antitrust Section for two years starting with the award of the Fellowship.
  3. The Fellow will be invited to attend Executive Committee meetings of the NYSBA Antitrust Section during the Summer and Fall of 2013.
  4. The Fellowship recipient will be announced no later than March 15, 2013.

Eligibility

 

The Fellowship is open to all first-year (1L) and second-year (2L) students (as of the Fall 2012 semester) who are capable of fulfilling the requested work hours and responsibilities and meet the criteria under the heading “Judging” below.

Fellowship Length

 

The Fellowship will take place during the summer of 2013 for a period of 10 weeks, approximately from June 3 to August 9, 2013. The expected work requirement per week generally will be 35 to 40 hours.

Location of Fellowship

 

The 2013 Fellowship will take place in the New York Office of New York Attorney General, Antitrust Bureau; Federal Trade Commission, Northeast Region; or  Department of Justice Antitrust Division, New York Field Office. Fellowship finalists will be interviewed in New York City.

Payment of Fellowship

 

The student will receive $3,000 at the start of the Fellowship with the remaining $3,000 paid to the student at the end of the Fellowship (no federal or state income taxes will be withheld and a 1099 will be issued to the student by January 31, 2014).

Housing and Other Expenses

 

Housing, transportation and all other expenses to participate in the Fellowship will be provided by the student.

Fellowship Application Requirements

 

     The applicant must submit the following:

 

  1. A completed application (application form below)
  2. Cover letter of interest
  3. Unofficial undergraduate school transcript
  4. Resume
  5. Two letters of recommendation
  6. One writing sample on any topic related to the law.  The writing sample must be at least five pages but shall not exceed 10 typed pages double-spaced.

 

Deadline

 

All hard copy materials must be submitted by mail with a postmark on or

before Friday, February 1, 2013.

 

Judging

 

A Fellowship Committee will undertake a careful review of all applications for the Fellowship, and will consider the criteria below in evaluating each candidate.   No single criterion or combination of criteria will be dispositive. 

 

  1. Content and quality of application materials.
  2. Demonstrated interest in antitrust and/or consumer protection.
  3. New York permanent residence or demonstrated intent to reside and practice law in New York following graduation from law school.
  4. Diverse background (e.g., Asian/Pacific Islander, Black/African American, Latino/a, LGBT, Native American/Alaska Native, Physically Disabled.)
  5. Work experience.
  6. Academic record.
  7. Leadership experience.
  8. Extracurricular activities and community service.
  9. Quality of written expression.
  10. Maturity, integrity and professionalism.
  11. Any other relevant factors.

 

Submission

 

All materials must be submitted by mail with a postmark on or before Friday, February 1, 2013.

Mail to:

ANTITRUST FELLOWSHIP

THE NEW YORK BAR FOUNDATION

ONE ELK STREET

ALBANY, NY 12207


Download NY bar

December 21, 2012 | Permalink | Comments (0) | TrackBack (0)

Toward an Economic Approach to Agency Agreements

Posted by D. Daniel Sokol

Angela Huyue Zhang (Herbert Smith) has posted Toward an Economic Approach to Agency Agreements.

ABSTRACT: It is a long-standing antitrust principle that agency relationships are exempt from price fixing violations. But the agency relationship must be "genuine." To discern genuine agency agreements, the prevailing approach adopted in both the United States and the EU focuses on the amount of risk incurred by the agent in relation to the distribution of the manufacturer's goods. Yet this approach has tended to obscure the economic nature of agency relationship. The real question to ask is not whether the agent has incurred any risk, but instead whether in a given case an agency model, rather than a distribution model, actually constitutes a more efficient form for organizing distribution functions between the contracting parties. In fact, over a quarter of a century ago, Judge Posner proposed a business justification approach for analyzing agency agreements in Morrison v. Murray Biscuit. Building on Morrison and on economic literature of property rights and agency problems, this article argues for an economic approach to discern genuine agency agreements. It also considers the unintended consequences that could result from legal constraints and, in particular, the implications for recent antitrust investigations into the e-book and online travel agency industries.

December 21, 2012 | Permalink | Comments (0) | TrackBack (0)

FTC Right to Close Google Investigation

Posted by D. Daniel Sokol

David Balto argues that the FTC Right to Close Google Investigation.

December 21, 2012 | Permalink | Comments (0) | TrackBack (0)

Buyer power in a regulatory context: myth or reality?

Posted by D. Daniel Sokol

Oxera asks Buyer power in a regulatory context: myth or reality? ABSTRACT: A report by Oxera for the Netherlands Competition Authority (NMa) illustrates that buyer power is an often misunderstood area in both theory and practice. Regulators wishing to adopt a more ‘light-touch’ approach to network regulation should take note.

December 21, 2012 | Permalink | Comments (0) | TrackBack (0)

Competition before Sunset: The Case of the Finnish ATM Market

Posted by D. Daniel Sokol

Maria Kopsakangas-Savolainen, Finnish Environment Institute, University of Oulu - Department of Economics and Tuomas Takalo, Bank of Finland, Monetary Policy and Research Department have written on Competition before Sunset: The Case of the Finnish ATM Market.

ABSTRACT: We build a simple model to study service fee competition between an incumbent and an independent ATM deployer, and its optimal regulation. We use the model to analyze an actual regulation of such a market by competition authorities in Finland. We find that socially optimal first-best fees would imply negative profits for the independent deployer, calling for a Ramsey regulation. While the Finnish regulation pushes the foreign fee downwards towards its socially optimal level, the regulated fees are likely to remain too high from the welfare point of view. In contrast with the actual regulation, it would be essential to regulate the independent deployer's interchange fee, as the incumbent deployer internalizes the effect of its foreign fee on consumer usage of the rival's network and has little incentive for foreclosure.

December 21, 2012 | Permalink | Comments (0) | TrackBack (0)

Thursday, December 20, 2012

Closing the Back Door Route to Cartels: The Need to Clarify the Regulated Conduct Doctrine

Posted by D. Daniel Sokol

The CD Howe Institute has released a study Closing the Back Door Route to Cartels: The Need to Clarify the Regulated Conduct Doctrine.

ABSTRACT: The Competition Bureau should actively engage in competition matters in regulated sectors of the economy, where anti-competitive conduct may be protected by government legislation or authority. This is the consensus view of the C.D. Howe Institute’s Competition Policy Council, which held its fourth meeting on November 8, 2012.

Members of the Council held that the Bureau should more clearly delineate the scope of anti-competitive practices that it sees as protected by provincial or federal legislation or delegated authority; and it should be directly engaged in regulatory decisions that potentially impair competition. As well, the Bureau should contribute independent analysis in merger reviews in regulated sectors.

December 20, 2012 | Permalink | Comments (0) | TrackBack (0)

Standing on the Shoulders of Babies: Dominant Firms and Incentives to Innovate

Posted by D. Daniel Sokol

Luis M. B. Cabral, New York University (NYU) - Leonard N. Stern School of Business - Department of Economics, and Ben Polak, explore Standing on the Shoulders of Babies: Dominant Firms and Incentives to Innovate.

ABSTRACT: Critics of Microsoft and Google's dominance claim these companies are nothing but "giants standing on the shoulders of babies,"whose dominance destroys the incentives for entrants to innovate. By contrast, pro-Microsoft and pro-Google analysts stress the benefits of large, innovative firms. We analyze the validity of these competing claims in a model of R&D and product market competition between a dominant firm and a small rival. An increase in firm dominance, which we measure by a premium in consumer valuation, increases the dominant firm's incentives but decreases the rival firm's incentives for R&D. We provide sufficient conditions such that the positive effect on the dominant firm is mostly infra-marginal, whereas the negative effect on the rival firm is mostly marginal. As a result, the R&D encouragement effect is lower than the R&D discouragement effect; and if innovation is sufficiently important then firm dominance also decreases consumer and social surplus. We also provide conditions such that an increase in firm dominance increases the probability of innovation, essentially because the transfer of innovation incentives form the rival firm to the dominant firm reduces the probability of duplicative R&D efforts.

December 20, 2012 | Permalink | Comments (0) | TrackBack (0)

Barak Orbach on Robert Bork

Posted by D. Daniel Sokol

The Washington Post has a nice Q&A on Robert Bork with Barak Orbach (Arizona).

December 20, 2012 | Permalink | Comments (0) | TrackBack (0)

Is the Effect of Competition on Price Dispersion Non-Monotonic? Evidence from the U.S. Airline Industry

Posted by D. Daniel Sokol

Mian Dai, Drexel University Qihong Liu, University of Oklahoma - Department of Economics and Konstantinos Serfes, Drexel University - Department of Economics & International Business ask Is the Effect of Competition on Price Dispersion Non-Monotonic? Evidence from the U.S. Airline Industry.

ABSTRACT: We investigate the effect of competition on price dispersion in the airline industry. Using panel data from 1993 to 2008, we find a non-monotonic effect of competition on price dispersion. An increase in competition is associated with greater price dispersion in concentrated markets but is associated with less price dispersion in competitive markets (i.e. an inverse-U relationship). Our empirical findings are consistent with an oligopolistic second-degree price discrimination model and encompass contradictory findings in the literature.

December 20, 2012 | Permalink | Comments (0) | TrackBack (0)

Use of Dominance, Unlawful Conduct, and Causation Under Section 36 of the New Zealand Commerce Act: A U.S. Perspective

Posted by D. Daniel Sokol

Jeffery M. Cross, Freeborn & Peters J. Douglas Richards, Cohen Milstein Maurice E. Stucke, University of Tennessee College of Law and Spencer Weber Waller, Loyola University Chicago School of Law offer Use of Dominance, Unlawful Conduct, and Causation Under Section 36 of the New Zealand Commerce Act: A U.S. Perspective.

ABSTRACT: The proper interpretation of the abuse of dominance provisions in Section 36 of the New Zealand Commerce Act has been a matter of controversy. The courts of New Zealand have taken a view of the requirements of this important provision of competition law in a narrow and formal manner that makes it very difficult to take enforcement action against conduct which has a net anticompetitive effect, but which has no, or at best minimal, business or procompetitive justification. We offer this white paper to provide a United States perspective to suggest that the current counterfactual test applied by the courts of New Zealand is not an effective enforcement tool and significantly out of step with the interpretation of unilateral conduct by dominant firms in the United States.

December 20, 2012 | Permalink | Comments (0) | TrackBack (0)

Wednesday, December 19, 2012

Social-Welfare-Enhancing Collusion and Trade

Posted by D. Daniel Sokol

George Deltas, University of Illinois at Urbana-Champaign - Department of Economics, Alberto Salvo, Northwestern University - Kellogg School of Management and Helder Vasconcelos, Universidade do Porto - Faculdade de Economia (FEP) analyze Social-Welfare-Enhancing Collusion and Trade.

ABSTRACT: Deltas, Salvo and Vasconcelos (2011) develop a model of geographically separated markets with differentiated goods in which collusion (or merger to monopoly), by restricting trade relative to duopolistic competition, is beneficial for society and can be beneficial for consumers. In this chapter, we provide additional results as well as an extension of that model. We show that a social planner would further restrict trade than the perfect cartel would, and how the socially optimal market allocation can be induced through a system of taxes and subsidies, or through "anti-dumping" regulation. We generalize the model to allow for home biased consumer tastes and show that our original analysis is robust. We also consider whether autarky can improve social welfare over market-based trade regimes, in the spirit of Brander and Krugman (1983).

December 19, 2012 | Permalink | Comments (0) | TrackBack (0)

Can the Right to Be Heard Be Respected Without Access to Information About the Proceedings? Deficiencies of National Competition Procedure

Posted by D. Daniel Sokol

Maciej Bernatt, University of Warsaw, Centre for Antitrust and Regulatory Studies asks Can the Right to Be Heard Be Respected Without Access to Information About the Proceedings? Deficiencies of National Competition Procedure.

ABSTRACT: This article analyses Polish competition procedure from the perspective of a) the right to be heard, and b) the right to receive information about the proceedings. It points out problems with access to information about competition proceedings which influence the level of protection of the right to be heard in these proceedings. In order to appraise this issue, the article embarks upon an examination of the rules governing the right to be heard in Polish competition enforcement proceedings. It then focuses on the extent of the competition authority’s obligation to inform undertakings about the actions addressed to them. The article includes discussion of the rules that circumscribe the parties’ right of access to evidence in the proceedings. Finally, proposals for changes in the practice of the competition authority, as well as in the Polish legal framework, are put forth. The new rules governing competition proceedings before the European Commission serve as an example for improvements in Polish competition procedures.

December 19, 2012 | Permalink | Comments (0) | TrackBack (0)

Robert Heron Bork (March 1, 1927 - December 19, 2012)

Posted by D. Daniel Sokol

Antitrust legend Robert Bork has died. Although now remembered by the public at large for his failed and highly contentious nomination to the Supreme Court, he is remembered within antitrust circles for path breaking work that helped create the Chicago revolution in antitrust. Two of his articles are among the most cited antitrust articles of all time. His book The Antitrust Paradox (1978) is the most cited book on antitrust ever (dwarfing citations to any antitrust article). Indeed, the Antitrust Paradox, as I note in the most recent issue of the Antitrust Law Journal, has been cited by over 100 courts. Sadly, many of these courts, including the Supreme Court, never quite understood what Bork meant by the consumer welfare paradox and so there continues to be confusion by the courts in rule of reason analysis. I never knew Bork personally but I am thankful that his writing led to a change from per se to rule of reason in many areas of antitrust.

December 19, 2012 | Permalink | Comments (0) | TrackBack (0)

Google resolution in sight - Free market is equal opportunity

Posted by D. Daniel Sokol

Orson Swindle, a former FTC Commissioner penned Google resolution in sight - Free market is equal opportunity in the Washington Times.

December 19, 2012 | Permalink | Comments (0) | TrackBack (0)

Analyzing the Motivations of a Joint Venture to Provide High-Quality Music Download Service to Mobile Phones

Posted by D. Daniel Sokol

Koki Arai (Competition Policy Research Center) is Analyzing the Motivations of a Joint Venture to Provide High-Quality Music Download Service to Mobile Phones.

ABSTRACT: This article explores the motivations of a joint venture to provide a high-quality music download service for mobile phones that resulted from a case of a concerted refusal to trade; this refusal was a violation of Antimonopoly Law. We analyze five years of monthly compact disk (CD) singles sales in order to identify the incentive for the concerted refusal to trade. The results show that when a CD single is ranked within the top three according to national sales charts, the effect of this factor is significantly greater than can be attributed to any simple ranking proportional effect, which is a prediction of the rank based on the number of sales in the week. Furthermore, we find that the complementary relationship among major companies as expressed by a joint venture could offer benefits. Commitment to a joint venture for the purpose of conveying one’s recognition of the venture and potentially beneficial intentions are a key determinant for joint venture formation.

December 19, 2012 | Permalink | Comments (0) | TrackBack (0)

Upcoming Events at UCL Law

Posted by D. Daniel Sokol

UCL has a number of upcoming events:

1.  Competition Law and IP rights event at the Competition Appeals Tribunal
2. An event on social media:
3. a course on US antitrust enforcement: http://american-antitrust.eventbrite.co.uk/

December 19, 2012 | Permalink | Comments (0) | TrackBack (0)

Delivering Competition Damages in the UK

Posted by D. Daniel Sokol

Christopher Hodges, University of Oxford - Centre for Socio-Legal Studies has posted Delivering Competition Damages in the UK.

ABSTRACT: This paper examines the system for delivering compensation for breach of competition law that would apply to claims if the proposals contained in 2012 consultation by the U.K. government came into effect. It examines how the system would operate in practice, and how an individual or collective claim would be dealt with. The position involves incorporating various innovative techniques from the three pillars of public enforcement, and private enforcement and ADR, each of which individually constitutes a significant reform, into a sophisticated pre-existing system. The result is complex and untested, not least because the details of every one of the major individual techniques are yet to be defined. The paper examines crucial influence that the incentives and powers (carrots, nudges and sticks) that would apply in each situation would have on how a claim is processed, or which impede it. It finds that the ADR and regulatory techniques can offer transformative solutions in delivering compensation. Whilst a private class action could operate in follow-on mass cases, it would be unnecessarily slow and costly compared with intelligent use of the ADR and regulatory alternatives. Significant concerns are identified over whether a class action would be effective in stand-alone or mass consumer cases. Accordingly, it suggests that policymakers should re-examine priorities as between private enforcement and other options.

December 19, 2012 | Permalink | Comments (0) | TrackBack (0)

Tuesday, December 18, 2012

The Animals Lurking in the Undergrowth—Derogations under the EU Merger Regulation

Posted by D. Daniel Sokol

Marcus Pollard (Linklaters) and Rosario Maria Rende Granata (Linklaters) address The Animals Lurking in the Undergrowth—Derogations under the EU Merger Regulation.

ABSTRACT: Following a recent policy move to open up its decisional practice, between August and October 2012, the European Commission (the ‘Commission’) published 22 derogation decisions under Article 7(3) of the EU Merger Regulation (EUMR) dating from 2004 through to 2011. They serve as a useful review of this mechanism but also provide further guidance on the circumstances in which an exception might be an option for notifying parties.

December 18, 2012 | Permalink | Comments (0) | TrackBack (0)

Concurrences 2013 Thesis Award

Posted by D. Daniel Sokol
 

Concurrences 2013 Thesis Award

Concurrences Journal will announce the 2013 Concurrences Award at its annual conference on 22 February 2013 in Paris at the seat of the National Assembly in presence of Commissionner Joaquin Almunia and Minister Fleur Pellerin.

Click here to see the conference programme.

The award-winning theses will be published in the Concurrences series co-published with Bruylant. The Award also comprises an internship in a jurisdiction or a national competition authority, or in one of the law firms partners of Concurrences Journal.

Eligible theses must focus on specific subjects in competition/regulation law or economics, excluding works on more general subjects, such as treatises and manuals. Law theses must concern EU competition law, law in member States, or law in States linked by cooperation agreements to the EU, as well as comparative law research with a European dimension. Only PhD theses are eligible, not Master theses.

Theses can be in English or French.

Eligible theses must have beeen defended between 1st January 2012 and 31 December 2012.

Jury members are:

  • Professor David Bosco, Professor of Law, Aix en Provence University 
  • Professor Muriel Chagny, Professor of Law, Versailles Saint Quentin University 
  • Professor Nicolas Petit, Professor of Law, Liège University 
  • Dr. Etienne Pfister, Deputy General Rapporteur, French Competition Authority, Paris 
  • A representative of a company or a law firm knowledgeable in the antitrust field

Award rules are available here on the Concurrences website.

The deadline for submission is 15 January 2013.

 
 

December 18, 2012 | Permalink | Comments (0) | TrackBack (0)