Antitrust & Competition Policy Blog

The implementation of the Antitrust Damages Directive in​ Luxembourg

Caroline Cauffman, Maastricht University describes The implementation of the Antitrust Damages Directive in​ Luxembourg.

ABSTRACT: The Antitrust damages directive was transposed into Luxembourgish law by the Loi du 5 décembre 2016 relative à certaines règles régissant les actions en dommages et intérêts pour les violations du droit de la concurrence et modifiant la loi modifiée du 23 octobre 2011 relative à la concurrence. The new rules apply to actions for damages introduced after its entry into force on 10 December 2016.

The Luxembourgish Transposition Act is limited to those provisions that are necessary to satisfy the requirements of the Directive. Rules that are (considered to be) included in the general law of obligations or civil procedure are not specifically transposed. In this regard it is noteworthy that the rules of the Directive concerning the power of the Court to order the disclosure of specified items of evidence or relevant categories of evidence circumscribed as precisely and as narrowly as possible on the basis of reasonably available facts in the reasoned justification have not been transposed specifically since the general rules of civil procedure are more lenient. The Directive does therefore not improve the position of the claimant in this respect. The rules of the Directive limiting the court’s power to the disclosure of evidence to what is proportionate and those concerning the protection of confidential information have been transposed. It is uncertain whether this leads to a more restrictive disclosure than that which had been available in the absence of the transposition of these provisions. The claimant’s position improves, however, regarding access to documents in the file of competition authority while the information on the Directive’s grey and black list Art. 6(5) and (6) is protected as required. Before the transposition of the Directive any use of documents obtained as a result of a public enforcement procedure for any other purpose was prohibited.

Legal disputes are expected regarding the application of the Transposition act to damages actions that are exclusively based on infringements of national competition law, the probative value of final infringement decisions by a competition authority or review court of another Member State, the notion of undertaking and its impact on parent company liability, the duration of the limitation period, the quantification of harm, the fact that the presumption of harm is passed on can only be invoked by direct purchasers and not by the infringer as a defence and the secondary consequences of solidarity/liability in solidum.

Antitrust Damages Actions: The Implementation of the Damages Directive and Beyond 8 November 2017

Conference

Centre of European Law

The Dickson Poon School of Law

King’s College London

in association with the Italian Antitrust Authority

 

Antitrust Damages Actions: The Implementation of the Damages Directive and Beyond

 

8 November 2017

The Moot Court, Somerset House East Wing

 

14.45   Welcome and introductory remarks Professor Andrea Biondi, Director of Centre of European Law King’s College London

 

 

15.00   Keynote Speech Professor Richard Whish QC (Hon), King’s College London

 

15.15 Private Law and Civil Procedure Chair- Professor Renato Nazzini, King’s College London

Panellists

1. Mrs Justice Rose, Chair, Competition Appeal Tribunal (invited)
2. Jacqueline Riffault-Silk, Judge at the Commercial Chamber, Cour de Cassation

iii. Carlo Santoro, Partner, Cleary Gottlieb Steen & Hamilton LLP

1. Anneli Howard, Barrister, Monckton Chambers
2. Hans Bousie, Partner, Bureau Brandeis

Q&A 15-30 minutes

 

16.45 Break

 

17.00  The Interaction between Private and Public Enforcement a. Chair - Gabriella Muscolo Commissioner, ICA

1. Chris Fonteijn, Chairman of the Board of the Netherlands Authority for

Consumers and Markets – ACM

1. Andrea Coscelli, Chief Executive - Competition and Markets Authority

iii. Anna Vernet, Head of Unit ECN and Private Enforcement - European

Commission

1. Professor Alison Jones, King’s College London
2. Professor Beniamino Caravita di Toritto, Università “La Sapienza” di Roma
3. Q&A15-30 minutes

18.30 Drinks reception

To reserve a place at this event please click here

ECN Plus – Should the New EU Directive Empowering National Competition Authorities Be All About Effectiveness?

Helene Andersson, Stockholm University - Faculty of Law asks ECN Plus – Should the New EU Directive Empowering National Competition Authorities Be All About Effectiveness?

ABSTRACT: In recent years there has been a rapid expansion in the number of jurisdictions with competition laws. In the late 1980s only 20 jurisdictions had adopted competition laws. Two decades later, the number had surpassed 110. With competition legislation in place in many parts of the world, focus is shifting towards enforcement issues and questions on how to ensure an effective application of the competition rules. The EU is no exception. Through the adoption of Regulation 1/2003, a system of parallel enforcement powers was established and the national competition authorities (‘the NCAs’) have since become an essential pillar of the application of the EU competition rules. The reform has resulted in a stronger and more active enforcement of the rules, but it has also revealed that some of the NCAs lack the tools required to ensure effective enforcement in their jurisdictions. With the explicit aim to enhance the effectiveness of the NCAs, the European Commission (‘the Commission’) has now presented a proposal for a directive (‘the Proposal’) which would align the national enforcement rules to their EU equivalent and ensure a level playing field throughout the EU.

The Transactionalization of EU Competition Law: A Positive Development?

Damien Geradin, Tilburg Law & Economics Center (TILEC); University College London - Faculty of Laws and Evi Mattioli, Liege Competition and Innovation Institute ask The Transactionalization of EU Competition Law: A Positive Development?

ABSTRACT: Over the last few years, a growing number of competition law investigations launched by the Commission end with the adoption of a commitments or, in the case of cartels, settlement decision. The success of these procedures is explained by the benefits they bring to both the Commission and the investigated undertakings. These procedures allow the Commission to save resources and obtain results quickly, while they allow undertakings to avoid the imposition of a fine (in the case commitments) or a decrease of the fine (in the case of settlements), as well as end the distraction created by investigation and control the damage to their reputation. This paper argues that excessive reliance on these procedures may have some downsides in that they may be poorly suited to deal with cases involving complex and novel questions of competition law. Moreover, in the case of commitments, there is a danger that this procedure by the Commission be used to extract remedies that it may not be able to include in an infringement decision subject to judicial review. As these procedures generate few appeals, there is also a danger that these procedures undermine the evolution of the case-law.

A Proposal for a Structural Remedy for Illegal Collusion

Joe Harrington, Wharton offers A Proposal for a Structural Remedy for Illegal Collusion.

ABSTRACT: It is proposed that competition authorities use a structural remedy for some convicted cartels. The remedy would have cartel member(s) sell productive assets such as capacity to other firms for the purpose of making the market more competitive. Compared to existing corporate penalties of government fines and customer damages, divestiture is more of a deterrent under certain conditions, can be more effective at compensating those consumers harmed, and, most importantly, is corrective by reducing the likelihood of recidivism and preventing post-cartel tacit collusion. The paper offers some guidance for the use of divestitures, examines the legal basis for such a remedy, and discusses several cases for which a structural remedy may have been feasible and appropriate.

CBA COMPETITION LAW FALL CONFERENCE – OCTOBER 26-27 – SHAW CENTRE, OTTAWA

Mark your calendars for October 26 and 27 and register for the upcoming CBA Competition Law Fall Conference, chaired by Shuli Rodal of Osler, Harkin Harcourt LLP. 

I am speaking on the Big Data Panel on Thursday and the Essential Facilities panel on Friday.  The Canadian Competition Bureau is highly capable.  Commissioner John Pecman has the reach and respect in the international competition policy community akin to Canadians Ryan Gosling, Ryan Reynolds and Seth Rogan in Hollywood.  Further, I am always impressed by the quality of law firm practitioners in Canada.  There are too many to mention by name (since someone would be offended by omission) but I think on a per capita basis, Canada has the strongest competition practitioner community in the world - small but formidable.  True to stereotype, they are also nice.

Competition Policy and the Control of Buyer Power A Global Issue

Peter Carstensen has a new book on Competition Policy and the Control of Buyer Power A Global Issue.

BOOK ABSTRACT: This book provides a comprehensive overview of the economic and competition policy issues that buyer power creates. Drawing on economic analysis and cases from around the world, it explains why conventional seller side standards and analyses do not provide an adequate framework for responding to the problems that buyer power can create. Based on evidence that abuse of buyer power is a serious problem for the competitive process, the book evaluates the potential for competition law to deal directly with the problems of abuse either through conventional competition law or special rules aimed at abusive conduct. The author also examines controls over buying groups and mergers as potentially more useful responses to risks created by undue buyer power.

 

McWane and Judicial Review of Federal Trade Commission Decisions - Any Inspirations for EU Competition Law?

Maciej Bernatt, University of Warsaw, Centre for Antitrust and Regulatory Studies has written on McWane and Judicial Review of Federal Trade Commission Decisions - Any Inspirations for EU Competition Law?

ABSTRACT: The article studies how intensively the administrative decisions of the European Commission’s counterpart - the U.S. Federal Trade Commission (FTC) - are reviewed by the U.S. Circuit Courts of Appeal. The standard used by the U.S. courts to review FTC factual and economic findings, known as the ‘substantial evidence test’ is examined. The main question is whether such a standard enables both effective and yet deferential review. An examination of U.S. case-law, and in particular of the McWane exclusive dealing case, promotes the view that the U.S. ‘substantial evidence test’ can be an inspiration for the improvement of judicial review in EU competition law. It enables a thorough review of the administrative decision, while at the same time leaving a space for deference to the FTC’s factual and economic findings (especially when two alternative conclusions can be reached based on the same facts). It seems to adequately balance the need for effective judicial review (required in the European context by Article 6 ECHR) with the need for expertise, and the inter-institutional balance in competition law. In addition, the institutional and procedural characteristics of the administrative proceedings before the FTC may serve as a point of reference with respect to improvement of due process and institutional impartiality in proceedings before the European Commission.

Partial Cartels and Mergers with Heterogeneous Firms: Experimental Evidence

Francisco Gomez-Martinez, Universidad Carlos III Madrid examine Partial Cartels and Mergers with Heterogeneous Firms: Experimental Evidence.

ABSTRACT: A usual assumption in the theory of collusion is that cartels are all-inclusive. In contrast, most real-world collusive agreements do not include all firms that are active in the relevant industry. This paper studies both theoretically and experimentally the formation and behavior of partial cartels. The theoretical model is a variation of Bos and Harrington’s (2010) model where firms are heterogeneous in terms of production capacities and individual cartel decisions are endogenized. The experimental study has two main objectives. The first goal is examine whether partial cartels emerge in the lab at all, and if so, which firms are part of it. The second aim of the experiment is to study the coordinated effects of a merger when partial cartels are likely to operate. The experimental results can be summarized as follows. We find that cartels are typically not all-inclusive and that various types of partial cartels emerge. We observe that market prices decrease by 20% on average after a merger. Our findings suggest that merger analysis that is based on the assumption that only full cartels forms produces misleading results. Our analysis also illustrates how merger simulations in the lab can be seen as a useful tool for competition authorities to back up merger decisions.

Akzo Nobel and Others v Commission: When Can Parent Companies be Liable for the Acts of Subsidiaries Even if Action Against the Subsidiary is Time-barred?

Jens Peter Schmidt asks Akzo Nobel and Others v Commission: When Can Parent Companies be Liable for the Acts of Subsidiaries Even if Action Against the Subsidiary is Time-barred?

ABSTRACT: The fact that the Commission’s power to impose fines on a subsidiary is time-barred does not preclude the parent from being held liable for the same infringement.

 

Excessive Pricing in Israel—How to Deal with A ‘Hot Potato’?

Talya Solomon and Iris Achmon  ask Excessive Pricing in Israel—How to Deal with A ‘Hot Potato’?

ABSTRACT: There is an ongoing debate whether and to what extent competition laws should regulate excessive pricing by entities with market power. Some jurisdictions, such as the USA, dismiss the concept entirely. Others, as is the case with the European Union, recognise the cause but place limitations on its enforcement, such that few excessive pricing cases ever go to court and fewer still are actually resolved.

Unobserved collusion: warning signs and concerns: Keynote Address at the Antitrust Enforcement Symposium, June 2017

Bob Marshall, Penn State discusses Unobserved collusion: warning signs and concerns: Keynote Address at the Antitrust Enforcement Symposium, June 2017.

ABSTRACT: In a keynote speech Robert C. Marshall addresses unobserved collusion. Although the extent and scope of unobserved collusion is unknown, the repeated detection of cartels among some multi-product firms raises questions and concerns. Do some multi-product firms potentially have a large portfolio of cartels where detected cartels are just a small part of their total collusive activity? This address examines conduct by multi-product firms that suggests potential grounds for concern.

 

New Nominations for FTC Chair and Commissioners

According to news sources, the nominees are Joe Simons as FTC Chairman, Rohit Chopra as a Democratic commissioner and Noah Phillips as a Republican commissioner.

Network effects, antitrust, and falsifiability

Paul Johnson, Canadian Competition Bureau has a paper on Network effects, antitrust, and falsifiability.

ABSTRACT:  In a speech, Paul A. Johnson discussed how network effects may affect competition analysis. Network effects arise when a product’s value to one consumer increases with consumption by others. But competition can fragment a market so that network effects may not be enjoyed. Products that rely on algorithmic analysis of big data and exhibit network effects are growing increasingly important in the economy. In response, should antitrust enforcement become less aggressive so as to allow the benefits of network effects to be enjoyed? This note answers that question in the negative based on a lack of clear consensus in the literature that the benefits of network effects outweigh the benefits of competition. As antitrust confronts new business models enabled by new technologies, the analysis also serves as a reminder of the importance of postulating theories that are scientific in the sense that they can be falsified.

 

Welfare-Reducing Entry in a Differentiated Cournot Oligopoly Without Costs

Shohei Yoshida, Osaka University - Institute of Social and Economic Research (ISER) examines Welfare-Reducing Entry in a Differentiated Cournot Oligopoly Without Costs.

ABSTRACT: We revisit the relationships between competition and various market outcomes in a differentiated Cournot oligopoly. Consider an oligopolistic market with two differentiated varieties, where each firm sells one of the varieties. We show that social welfare and consumer surplus can decrease with the number of firms when the products of entrants and incumbents are homogeneous. Moreover, an entry of firm can increases prices and profits of firm producing the other variety. We provide a simple exposition of the conditions which determine the effect of an increase in the number of entrants on various market outcomes.

Where Do We Stand on Discounts after Intel?

Christian Bergqvist, University of Copenhagen - Faculty of Law asks Where Do We Stand on Discounts after Intel?

ABSTRACT: The dominant undertaking’s ability to award discounts and other loyalty inducing considerations are subject to much ambiguity and unsettled issues. Despite discounts being a commercial requirement, even for the dominant undertaking, it’s difficult to draw up clear principles, and while the approach to non-dominant undertaking’s restriction of competition has been fundamentally recast over the last 20 years, the appraisal of single company behaviour remains more formal and rigid. However, there have recently been indications that some of the same leniency might have been extended to discounts and unilateral behaviour. Consequently, an attempt shall be made to provide some guidelines under EU and Danish practice. Danish companies would normally be governed by both and the later has been aligned to the former, thus providing general guidance on EU practice. Moreover, the recent Intel will be incorporated with due respect to the different possible reading of the Court of Justices ruling.

Patent Assertion Entities and Legal Exceptionalism in Europe and the United States, a Comparative View

Jorge L. Contreras, University of Utah - S.J. Quinney College of Law and Peter Georg Picht University of Zurich - Institute of Law; Max Planck Institute for Innovation and Competition offer Patent Assertion Entities and Legal Exceptionalism in Europe and the United States, a Comparative View.

ABSTRACT: Patent assertion entities are playing an increasing role in patent policy and patent litigation, both in the U.S. and Europe. Analyzing the resulting case law, mainly in the SEP/FRAND context, this article shows similarities as well as differences in the approaches taken by U.S. and EU courts.

The Effect of Optimal Penalties for Organizations Convicted of Price Fixing in the Presence of Criminal Sanctions for Individuals

Bruce H. Kobayashi, George Mason University - School of Law and Michelle Burtis, Charles River Associates (CRA) International explore The Effect of Optimal Penalties for Organizations Convicted of Price Fixing in the Presence of Criminal Sanctions for Individuals.

ABSTRACT: This chapter examines the nature of optimal price fixing penalties on organizations in the presence of criminal sanctions for individuals employed by convicted firms. In other work, we examined the nature of optimal penalties for firms convicted for price fixing when the only sanction is the one placed on the firm. This chapter expands the economic analysis to examine how optimal organizational sanctions function when individuals employed by the firm are subject to criminal penalties, including incarceration. Our analysis demonstrates how sanctions on individuals can serve to complement firm level expenditures on monitoring and compliance, resulting in better deterrence and lower compliance costs.

Heterodox Antitrust Economics

Jim Chen, Michigan State examines Heterodox Antitrust Economics.

ABSTRACT: Antitrust economics is a discipline developed by academic economists in concert with the refinement of per se rules and the rule of reason by the Supreme Court. Distinct bodies of antitrust thought — such as the Chicago school, the post-Chicago school, and behavioral antitrust economics — have emerged. These competing schools of thought fall short of capturing the full complexity of economic conduct. Antitrust law cannot and should not seek to replicate often conflicting insights devised by economists. Rather, what antitrust economics can accomplish is at once more modest and more helpful. The laudable resort to economic theory in any of its guises, behavioral or otherwise, should never become detached from economic fundamentals. 

The German Auto-Emissions Scandal: Likely U.S. Antitrust Response

John M. Connor, American Antitrust Institute (AAI) offers The German Auto-Emissions Scandal: Likely U.S. Antitrust Response.

ABSTRACT: After years of being regarded as an environmental and consumer-protection issue, the German diesel-motor emissions scandal has suddenly morphed into an antitrust case. Press reports indicate that at least five German auto or auto-parts makers are under investigation by European competition-law authorities. In this comment, I focus on the historical and likely future responses of the United States Department of Justice (DOJ) to allegations of collusion among the largest German auto manufacturers identified in the press as of 8 August 2017. I predict that the DOJ is likely to treat allegations of cartelization through manipulation of technology as simply another in a long stream of auto-parts cartels. Assuming that there is evidence of effects on the U.S. auto market, the all-German make-up of this putative cartel will be no barrier to prosecution. However, the somewhat unusual type of conduct of this remarkably close R&D collaboration means that U.S. prosecutors will have to consider several legal and economic features that are out of the ordinary.