Sunday, February 23, 2014

1st CRESSE Lawyers Week: Course on "The Role of Economics in Competition Law and Practice" Corfu island, Sunday 6th - Friday 11th July, 2014

1st CRESSE Lawyers Week: Course on "The Role of Economics in Competition Law and Practice" Corfu island, Sunday 6th - Friday 11th July, 2014CRESSE is happy to announce the organization of the 1st Lawyers Week with the course on “The Role of Economics in Competition Law and Practice” that will take place from Sunday 6th July to Friday 11th July, 2014, in the island of Corfu.            

Who is the course for?

The course is targeted to lawyers practicing in competition law as counsels, enforcers or judges or in another field of law in which knowledge of economics is helpful.  As such, the course does not require students to have any prior knowledge of economics or quantitative techniques. Lectures rely on verbal descriptions and graphs to covey key concepts and special emphasis is given in drawing on case examples in order to review and apply the economic principles and methods.

There are no formal entry requirements but the course is designed for legal practitioners looking to gain a rigorous introduction to the increasingly important role that economics plays in competition law. Applicants will be asked to fill in an Application Form demonstrating their suitability for the course, including a short personal statement that indicates what they hope to achieve from attending it. 

Objective of the course            

The objective of the course is to introduce the economic theories that underlie competition law, the methods and tools that are used to assess whether business practices are socially harmful or benign and the economic issues related to the enforcement of the law. It is designed to provide students with a deep understanding of economic concepts and theories and of how they are applied to competition policy and a solid grounding in the tools and methods used in the examination of specific cases.

The course is taught by some of the foremost competition economists in the world. It covers both an introduction to microeconomics, game theory and industrial organisation theory, as well as, all the areas in the application of economics to competition policy. The latter includes the analysis of market power, market definition, cartels and other coordinated behaviour, abusive unilateral conduct by dominant firms (all exclusionary practices), vertical restraints, horizontal and vertical mergers, antitrust and intellectual property, issues related to the evaluation of damages in competition cases and the assessment of fines and issues related to the assessment of economic evidence in courts.

The course is provided concurrently with the acclaimed CRESSE Summer School that will be given for the ninth consecutive year in 2014 the participants of which are also practicing professionals and PhD students, but mostly with some economics or technical background. The CRESSE Summer School runs over two weeks and includes modules on advanced quantitative techniques and on sectoral regulation.

Key Benefits

Gives an extensive in-depth insight into the economics needed for competition law cases.

Programme material is written by experts – some of the foremost experts in the world in competition economics.

Each participant will receive a signed Certificate of Attendance, which includes details for the Sessions attended, of their duration and of the instructors that were involved in the teaching of each Module. The Certificate of Attendance is sent to each participant at about the end of September. 

The course gives the opportunity to participants to obtain within just one week an extensive introduction to the economics that underlie the assessment of competition law cases, in beautiful surroundings. For more information see link Venue and Accommodation.


February 23, 2014 | Permalink | Comments (0) | TrackBack (0)

Friday, February 21, 2014

Competition and Market Strategies in the Swiss Fixed Telephony Market - An Estimation of Swisscom's Dynamic Residual Demand Curve

Roberto E. Balmer, Bundesamt für Kommunikation; University of Rome I - Faculty of Economics explores Competition and Market Strategies in the Swiss Fixed Telephony Market - An Estimation of Swisscom's Dynamic Residual Demand Curve.

ABSTRACT: Fixed telephony has long been a fundamentally important market for European telecommunications operators. The liberalisation and the introduction of regulation in the end of the 1990s, however, allowed new entrants to compete with incumbents at the retail level. A rapid price decline and a decline in revenues followed. Increased retail competition consequently led a number of national regulators to deregulate this market. In 2013, however, many European countries (including Switzerland) continued to have partially binding retail price regulation. More than a decade after liberalisation and the introduction of wholesale and retail price regulation, sufficient data is available to empirically measure the success of regulation and assess its continued necessity. This paper develops a market model based on a generalised version of the traditional “dominant firm – competitive fringe” model allowing the incumbent also more competitive conduct than that of a dominant firm. A system of simultaneous equations is developed and direct estimation of the incumbent’s residual demand function is performed by instrumenting the market price by incumbent-specific cost shifting variables as well as other variables. Unlike earlier papers that assess market power in this market, this paper also adjusts the market model to ensure a sufficient level of cointegration and avoid spurious regression results. This necessitates introducing intertemporal effects. While the incumbent’s conduct cannot be directly estimated using this framework, the concrete estimates show that residual demand is inelastic (long run price elasticity of residual demand of -0.12). Such a level of elasticity is, however, only compatible with a profit maximising incumbent in the case of largely competitive conduct (conduct parameter below 0.12 and therefore close to zero). It is therefore found that the Swiss incumbent acted rather competitively in the fixed telephony retail market in the period under review (2004-2012) and that (partial) retail price caps in place can no longer be justified on the basis of a lack of competition.

February 21, 2014 | Permalink | Comments (0) | TrackBack (0)

Patent Hold-Up and the Limits of Competition Law: A Trans-Atlantic Perspective

Urska Petrovcic, European University Institute has written on Patent Hold-Up and the Limits of Competition Law: A Trans-Atlantic Perspective.

ABSTRACT: The problem of patent hold-up is currently one of the most discussed antitrust topics in the European Union and in the United States. On both sides of the Atlantic, competition authorities addressed the opportunistic conduct of patent owners through the provisions of competition law. The reach such provisions have in addressing the patent owner’s opportunistic licensing practices remains however unclear. The present article brings some clarity to this picture by analyzing the applicability of the antitrust provisions to cases of patent hold up. The analysis shows that the provisions of the two jurisdictions have different scopes when addressing these cases. Whereas in the EU, the European Commission might be able to address a large specter of patent owners’ opportunistic licensing practices, most conducts would escape the liability under US antitrust law. The divergent outcomes are however not attributable to the application of different legal tests, or different views of the competition authorities. Rather the contrary. Competition authorities share the concerns on patent hold up, but are unable to reach similar outcomes because of the divergent prohibitions embodied in the antitrust provisions of the two jurisdictions. The analysis also shows that in neither of the systems does competition law provide a definitive solution to the problem of patent hold-up.

February 21, 2014 | Permalink | Comments (0) | TrackBack (0)

Explicit Collusion Under Antitrust Enforcement

Igor Mouraviev, Bielefeld University - Center for Mathematical Economics analyzes Explicit Collusion Under Antitrust Enforcement.

ABSTRACT: The article seeks to fi…ll the gap between tacit and explicit collusion in a setting where firms observe only their own output levels and a common price, which includes a stochastic component. Without communication, firms fail to discriminate between random shocks and marginal deviations, which constrains the scope for collusion. By eliminating uncertainty about what has happened, communication facilitates detection of deviations but reduces collusive profits due to the risk of exposure to legal sanctions. With the optimal collusive strategy, firms communicate only if the market price falls somewhat below the trigger price. Moreover, they tend to communicate more often as they become less patient, a cartel grows in size, or demand uncertainty rises.

February 21, 2014 | Permalink | Comments (0) | TrackBack (0)

Thursday, February 20, 2014

Competitiveness and Competition: International Merger Control from the Business Prospective

Alexandr Svetlicinii discusses Competitiveness and Competition: International Merger Control from the Business Prospective.

ABSTRACT: Increasing globalization of international markets has prompted development of economies of scale on the international level. Mergers and acquisitions is one of the ways for the multinational companies to increase their competitiveness and expand on the global market. This business strategy is limited by the existing merger control regulations on the national level. The multi-jurisdictional approval of trans-national mergers remains costly and lengthy procedure that negatively affects companies’ performance and growth. International antitrust, as it stands today hasn’t produced an optimal, universally accepted model to deal with the trans-national mergers. There are several alternative solutions in the form of bilateral cooperation of competition authorities, comity agreements, proposals to design an international competition treaty or delegate the merger control competence to an international organization like WTO. Special emphasis will be attributed to the example of the EU-US merger control cooperation as a model for other countries.

Present research is aimed at analysis of the trans-national merger control from the position of the business community. What is the role and the position of the business on this issue? What are the benefits and challenges that companies encounter within existing merger control frameworks? Comparative and interdisciplinary approach is used in order to analyze this multi-dimensional issue from the substantive and procedural points of view. Present work provides arguments in favor of the existing and evolving cooperation among competition authorities and its value to the business community and calls for increased involvement of business representatives in the policy development process.

February 20, 2014 | Permalink | Comments (0) | TrackBack (0)

Accession to the EU's Competition Law Regime: A Law and Governance Approach

Kati Cseres, University of Amsterdam - Amsterdam Centre for European Law and Governance and Amsterdam Center for Law & Economics has written on Accession to the EU's Competition Law Regime: A Law and Governance Approach.

ABSTRACT: Competition law has always formed a core pillar of the European integration process and so it was among the crucial EU requirements set for the candidate countries. Competition law had a significant influence on the way competition laws and institutions were shaped in the candidate countries. In the pre-accession phase this was due to conditionality, however once conditionality terminates and candidate countries become Member States they fall under the EU law and its governance mechanisms, in competition law under Regulation 1/2003. While pre-accession rule transposition is well documented and closely monitored by the EU in its Regular Reports on the candidate countries, the EU’s internal governance mechanisms are less visible and have not been examined in the light of its external model that developed in the course of its eastward enlargement. In EU competition law such internal mechanisms have developed within the framework of Regulation 1/2003. These post-accession compliance mechanisms are critical both with regard to the effectiveness of the EU’s external governance and the internal system of Regulation 1/2003.

The aim of this paper is to analyse the interplay between the EU’s external (pre-accession) and internal (post-accession) governance model in the field of competition law and to arrive at a deeper understanding of the EU’s Europeanization strategy at the intersection of the external and internal governance models. Accordingly, the paper maps the EU’s external law and governance model that applies vis-à-vis third countries that wish to join the EU and examines to what extent and how this external model has shaped the EU’s internal governance model vis-à-vis its Member States. It analyses the role of Regulation 1/2003 in creating an effective implementation of EU competition law in the Member States and its governance mechanisms that framed the Europeanization process. In order to evaluate the effectiveness of post-accession compliance in the Member States the paper examines the compound procedural framework composed of EU and national administrative rules that underlies and challenges the enforcement of EU competition law and investigates how administrative capacity of the national competition authorities may effect competition law enforcement. This inquiry includes the detailed assessment of the European Competition Network as the EU’s main mechanism to monitor compliance of Member States with EU law in the post-accession phase.

February 20, 2014 | Permalink | Comments (0) | TrackBack (0)

What Keeps Plaintiffs Away from the Court? An Analysis of Antitrust Litigation in Japan, Europe and the US

Simon Vande Walle, University of Tokyo - Graduate Schools for Law and Politics asks What Keeps Plaintiffs Away from the Court? An Analysis of Antitrust Litigation in Japan, Europe and the US.

ABSTRACT: This paper challenges the classical view on the role of litigation in Japan by examining a particular type of litigation, namely private antitrust litigation. It shows that the widely held idea that antitrust litigation in Japan is rare only holds when compared to the US, not Europe. The comparison with Europe also casts doubt on the idea that a cultural aversion to litigation exists in Japan. Instead, the institutional framework and the awareness and support for antitrust law are much more important. These are malleable factors, suggesting that antitrust litigation can boom in Japan and Europe, regardless of any cultural resistance.

February 20, 2014 | Permalink | Comments (0) | TrackBack (0)

R&D Cooperation with Entry

Siddhartha Bandyopadhyay, University of Birmingham - Department of Economics and Arijit Mukherjee, University of York (UK) analyze R&D Cooperation with Entry.

ABSTRACT: e show the effects of entry by a non‐innovating firm on the innovating firms' incentive for undertaking cooperative R&D, highlighting the implications of knowledge spillover. Entry by a non‐innovating firm may either increase or decrease the incentive for cooperative R&D compared with no entry, depending on the innovating and the non‐innovating firms' gains from knowledge spillover. The entry deterrence motive, which has so far been ignored in the literature, plays an important role in determining R&D organization in our analysis.

February 20, 2014 | Permalink | Comments (0) | TrackBack (0)

Wednesday, February 19, 2014

Vertical Issues in High Tech Industry - "Advice to Foreign Multinationals Doing Business in China on Vertical Issues" Tuesday, March 4, 2014 9:00 AM - 10:30 AM EST

Vertical Issues in High Tech Industry 

"Advice to Foreign Multinationals Doing Business in China on Vertical Issues" Part 1 of 3

A non-CLE Teleconference Panel Discussion proudly presented by
ABA Section of International Law
China Committee and the International Antitrust Law Committee


Co-Sponsored by

Asia Pacific Committee;
International Anti-Corruption Committee;
ABA Section of Intellectual Property Law

By Teleconference Only
Tuesday, March 4, 2014 
9:00 AM - 10:30 AM EST
10:00 PM - 11:30 PM China Standard Time


In this program, we will discuss vertical issues faced by companies in the high tech industry during merger review or government investigation in China.  Key issues include licensing of key technology, standard setting and FRAND, and battles between patent assertion entities and device manufacturers.



  • Dr.      Elizabeth Wang, Charles River Associates,      Boston, MA 


  • Yao      Feng, Broad & Bright, Beijing
  • Daniel      Sokol, University of Florida,      Gainesville, FL
  • Dr.      Joanna Tsai, US Federal Trade Commission,      Washington, DC
  • Representative       from  State Administration for Industry & Commerce or      Ministry of Commerce, Beijing China


Registration Rates:

$15 - Section of International Law Members
$25 - SIL Non-Members

Package Pass Rate:
*3 Programs for the Price of 2*

$30 - SIL Members
$50 - SIL Non-Members

February 19, 2014 | Permalink | Comments (0) | TrackBack (0)

Defying Conventional Wisdom: The Case For Private Enforcement

Joshua P. Davis, University of San Francisco - School of Law and Robert H. Lande, University of Baltimore - School of Law are Defying Conventional Wisdom: The Case For Private Enforcement.

ABSTRACT: The conventional wisdom is that private antitrust enforcement lacks any value. Indeed, skepticism of private enforcement has been so great that its critics make contradictory claims. The first major line of criticism is that private enforcement achieves too little — it does not even minimally compensate the actual victims of antitrust violations and does not significantly deter those violations. A second line of criticism contends that private enforcement achieves too much — providing excessive compensation, often to the wrong parties, and producing overdeterrence. This article undertakes the first ever systematic evaluation of these claims. Building upon original empirical work and theoretical inquiry by the authors, and an assessment of the specific factual bases of the criticisms, the article demonstrates that private enforcement provides important and beneficial compensation and deterrence, although the level of both is likely suboptimal. Moreover, the article shows it is highly unlikely that private enforcement produces excessive compensation or deterrence. The article concludes that private enforcement should be strengthened and explores some implications of this conclusion.

February 19, 2014 | Permalink | Comments (0) | TrackBack (0)

European Merger Remedies

Dorte Hoeg has written a book on European Merger Remedies.

BOOK ABSTRACT: As merger transactions become more complex, so do the remedies involved. This book seeks to identify and examine the most important aspects of merger remedies, which have emerged and evolved in the European Commission's policy and practice over the past 20 years. The in-depth analysis of applicable provisions and guidelines is structured in accordance with a typical 'remedies lifecycle': the negotiation, submission, assessment, adoption, implementation and enforcement of remedies. Furthermore, numerous conditional clearance decisions and judgments as well as studies and legal literature on the subject are described and put into a coherent analytical framework with the aim of providing as much nuance as possible in the evaluation of the Commission's past and present remedies policy and practice.

While the Commission indisputably has accomplished numerous successes in its remedies enforcement over the years, it has also encountered some significant obstacles and shortcomings along the way. To this effect, the final chapter in the book critically assesses whether the current framework, which has remained unchanged since 2008, continues to provide an adequate regulatory response to today's remedies issues and challenges. Where adjustments and improvements are deemed desirable or necessary, possible measures are considered.

February 19, 2014 | Permalink | Comments (0) | TrackBack (0)

Welcome Competition Academia

A number of competition academics, led by ASCOLA have created the blog.

February 19, 2014 | Permalink | Comments (0) | TrackBack (0)

All Units Discount: Experimental Evidence from the Vending Industry

Christopher T. Conlon (Columbia) and Julie Holland Mortimer (Boston College) have a new paper on All Units Discount: Experimental Evidence from the Vending Industry.

ABSTRACT: We study an All-Units Discount, in which a downstream firm pays a linear wholesale price up to a quantity threshold, beyond which a discount applies to all future and previous units. The result of the contract is that marginal cost downstream is effectively negative over a quantity range. Such contracts are common in many industries, and we implement a field experiment in one such industry (confections), in which we remove top-selling products from a market in order to identify the potential efficiency effect of the contract. We combine the experimental variation with a structural model of demand and a dynamic model of the retailer's re-stocking decision to identify cases in which the contract results in either efficient or inefficient exclusion of competing products. We show how the contract allocates the cost of a stock-out between upstream and downstream firms, and find evidence of inefficient exclusion. Finally, we point out that the impact of upstream mergers in these markets is likely to be felt not through the price in the final-goods market, but rather in the wholesale market. We examine the impact of various upstream mergers on the willingness of the dominant firm to offer rebate contracts, and the impact that the rebate contracts have on social welfare.

February 19, 2014 | Permalink | Comments (0) | TrackBack (0)

Leniency program and cartel deterrence in Russia: effects assessment

Gyuzel Yusupova (National Research University Higher School of Economics) offers Leniency program and cartel deterrence in Russia: effects assessment.

ABSTRACT: The empirical assessment of leniency program (LP) in Russia shows the effects of changes in the rules on the behavior of market participants. In this paper we test hypotheses about LP enforcement against the characteristics of cartels: their subject, duration and the number of participants. We show that LP in Russia makes enforcement of the behavior of market participants less effective and accordingly reduces cartel discoveries. However the reforms of Program in 2009 give some positive results.

February 19, 2014 | Permalink | Comments (0) | TrackBack (0)

Tuesday, February 18, 2014

Collusion detection in procurement auctions

Ilya Morozov (International Laboratory for Institutional Analysis of Economic Reforms) and Elena Podkolzina (International Laboratory for Institutional Analysis of Economic Reforms) analyze Collusion detection in procurement auctions.

ABSTRACT: This paper proposes a method of bid-rigging detection, which allows us to reveal cartels in procurement auctions without any prior knowledge of the market structure. We apply it to data on highway construction procurements in one of the Russian regions and show that five suppliers demonstrated passive bidding behavior, which is consistent with the so called ‘rotating bidding’ scheme of collusion. The suggested methodology can be potentially used by both researchers and anti-trust agencies for cartel disclosure in various markets.

February 18, 2014 | Permalink | Comments (0) | TrackBack (0)

What impact does antitrust intervention have on competition? The case of public drug procurement in Russia

Maria Ostrovnaya (the National Research University Higher School of Economics) and Elena Podkolzina (National Research University Higher School of Economics) ask What impact does antitrust intervention have on competition? The case of public drug procurement in Russia.

ABSTRACT: In this paper we study antitrust intervention in long-term relationships between public procurer and his preferred supplier in one of the Russian regions. We presume that antitrust control of auctions held by affiliated procurer increases the risks of implementing long-term relationships with his preferred supplier. However we found out that after the intervention of antitrust agency the number of bidders in the auctions increased, but relative contract prices remained the same. We argue that procurer and preferred bidder invited firm with passive bidding strategy to decrease the risks of antitrust punishment. Thereby, antitrust intervention led to fake competition, but not to honest non-corrupt behavior in public auctions.

February 18, 2014 | Permalink | Comments (0) | TrackBack (0)

ICN Investigative Process Project - Please Take This Survey

Dear Competition Law Practitioner -


The International Competition Network's Agency Effectiveness Working Group is in its second year of its Investigative Process Project (the “Project”).  Last year the Project focused on transparency and procedural fairness in competition proceedings. 


This year the Project is examining the use of confidential information in competition proceedings.   Three non-government advisors last year, on their own, surveyed practitioner’s views and experiences with transparency and procedural fairness.  This year the same three non-government advisor are again launching another survey, this time with regard to confidentiality.


As a practitioner your views and experience matters.   It is critical that competition agencies better understand your perspective on the investigative process.  For the survey last year more than 90 practitioners from across more than 30 jurisdictions provided feedback.  We hope that you will consider taking this year's survey on confidentiality.  The survey respondents are kept confidential and the answers are presented in a general manner. 


We invite you to take the survey as well as pass it along to other practitioners.  Surveys need to be completed by March 10th.


CLICK HERE to take the survey or visit:

Thank you.


James Rill, Non-government advisor, ICN -

Sean Heather, Non-government advisor, ICN -

Charles Webb, Non-government advisor, ICN -

February 18, 2014 | Permalink | Comments (0) | TrackBack (0)

The effects of mergers on sellers, customers, and competitors in Russia’s ferrous and non-ferrous metal industries: the application of financial event study

Dina Tsytsulina (National Research University Higher School of Economics) discusses The effects of mergers on sellers, customers, and competitors in Russia’s ferrous and non-ferrous metal industries: the application of financial event study.

ABSTRACT: Russian producers are large participants in both domestic and international markets of ferrous and non-ferrous metals. Their market power is limited on the world market due to the presence of competitors, while in Russia most of them have achieved an “almost monopolistic” position strengthened by a high market share as a result protection from import tariffs. During 1999-2011 numerous mergers in these industries were completed and approved by the Federal Antitrust Service – Russia’s competition agency. The key problem of merger analysis in Russia’s ferrous and non-ferrous metal industries is the trade-off between a (possible) weakening of competition in domestic markets and achieving competitive advantages in international markets. Most merger deals were approved only together with precisely developed merger remedies aimed at preventing dominance abuse. However, it is still unknown whether the weakening of competition and the abuse of dominance on the domestic market as the result of a merger indeed lead to harmful consequences. Using the financial event study method developed by Eckbo and Wier (1985), this paper empirically verifies the significance of anticompetitive effects of mergers in the domestic ferrous and non-ferrous metal markets. I find that, according to the financial market, mergers between Russian metal producers restrict competition and reduce consumer gains.

February 18, 2014 | Permalink | Comments (0) | TrackBack (0)

On licensing and diffusion of clean technologies in oligopoly

Idrissa Sibailly (Department of Economics, Ecole Polytechnique - CNRS) provides thoughts On licensing and diffusion of clean technologies in oligopoly.

ABSTRACT: Clean technologies implemented by polluters subject to environmental regulation are often developed and patented by specialized technology suppliers. This paper investigates the impact of the environmental regulation stringency on the diffusion of patented clean technologies when the polluters (i.e. the potential licensees) compete in imperfectly competitive markets. We show that the polluters' willingness to pay for clean technology and the diffusion of such technology (i.e. the extent to which it is privately disseminated through licensing) depend not only on the regulatory stringency and the technological efficiency, but also on the polluters' competitive environments. More stringent regulations (e.g., higher carbon taxes) or increased technological efficiency (e.g., supported by more R&D subsidies) do not necessarily induce more diffusion of efficient clean technologies. Indeed, as the returns to implementing a clean technology increase, so do the technology supplier's incentives to sell fewer licenses so as to extract more rent from each of its licensees.

February 18, 2014 | Permalink | Comments (0) | TrackBack (0)

Monday, February 17, 2014

Spillovers, product substitution and R&D investment : theory and evidence

Thomas Grebel (Economics Deprtment, TU Ilmenau) and Lionel Nesta (Ofce) describe Spillovers, product substitution and R&D investment : theory and evidence.

ABSTRACT: We investigate the conditions under which R&D investment by rival firms may be negatively or positively correlated. Using a two-stage game the influence of spillovers and product substitution is investigated. It is shown that under Cournot competition, the sign of the R&D reaction function depends on four types of environments in terms of the level of product substitution and of spillovers. We then test the prediction of the model on the world’s largest manufacturing corporations. We assume that firms make oblivious R&D investments based on the R&D decision of the average rival company. We then develop a dynamic panel data model that accounts for the endogeneity of the decision of the mean rival firms. Results corroborate the validity of the theoretical model.

February 17, 2014 | Permalink | Comments (0) | TrackBack (0)