International Antitrust Research Articles

Two Steps Forward and One Step Back?: US, EU and China’s Bilateral Antitrust Cooperation and International Trade

Greater antitrust enforcement is argued to have positive correlations with the promotion of international trade. By 2019, the US, the EU and China, as global trade powers, have formed and strengthened bilateral antitrust cooperation to seek greater enforcement. However, the impact of such development on international trade has remained underexamined. The article argues that irrespective of their different legal forces, the US-EU, US-China and EU-China antitrust cooperation share convergences at the optimum and minimum levels. Based on the case study of the US, the EU and China’s regulations of the international Liquid Crystal Display (LCD) panel cartel, the article illustrates that as the effects doctrine continues to serve as the main normative value underpinning antitrust cooperation, matured competition regimes lack the incentive to share information with new regimes, competition regimes converge to apply comity restrictively and the consultation mechanism plays a limited role in holding the sides accountable under bilateral cooperation. Consequently, international antitrust remains fragmented, positing restraints to trade. The article calls for reconsideration of the effects doctrine as part of the transnational normative repertoire shaping bilateral antitrust cooperation and for devising policy tools to guarantee minimum information exchange among agencies. US, EU, China, International Antitrust, Bilateral Cooperation, Exchange of Information, Confidentiality, Comity, Consultation

Non-Monetary Antitrust Sanctions: The Brazilian Experience between 2012 and 2022 and Some Additional Reflections for International Antitrust Practice

Non-Monetary Antitrust Sanctions: The Brazilian Experience between 2012 and 2022 and Some Additional Reflections for International Antitrust Practice

International Antitrust Negotiations and the False Hope of the WTO

Multinational corporations (“MNCs”) operate today in an increasingly open global trade environment. While tariff barriers have collapsed dramatically, several states and numerous scholars have raised concerns that the benefits of trade liberalization are undermined by various non-tariff barriers (“NTBs”) to trade, including the anticompetitive business practices of private enterprise. As a result, demands to link trade and antitrust policies more closely by extending the coverage of the World Trade Organization (“WTO”) to incorporate antitrust law have gathered momentum over the last decade.1 Most advocates of a WTO antitrust agreement base their normative claims on largely intuitive assumptions about the necessity or desirability of international rules.2 The existing literature contains few examinations of the strategic situation that characterizes international antitrust cooperation and, as a result, has either completely ignored or largely mischaracterized the collective action problem that has impeded the efforts to negotiate any multinational antitrust rules. With the help of insights developed in game theory, this Article seeks to fill the gap in the current debate by analyzing the strategic interactions underlying states’ attempts to seek convergence of their antitrust laws. Understanding why attempts to generate formal international antitrust cooperation have thus far been unsuccessful is a critical

Lead Jurisdiction Concepts: Prospects and Limits for Rationalizing International Competition Policy Enforcement

Lead jurisdiction models represent one option how to extend and enhance contemporary interagency cooperation among competition policy regimes. They constitute a multilateral, case-related form of cooperation that is suited to effectively create a one-stop-shop for the prosecution of international cartels, the handling of cross-border mergers and acquisitions and the governance of international antitrust cases. Thus, lead jurisdiction models offer considerable economic benefits. However, they also entail several caveats. Three possible working problems and downside effects of lead jurisdiction models in international competition policy enforcement are discussed in this paper.

Testimony on International Antitrust Enforcement

Prepared Statement of Koren W. Wong-Ervin, Antonin Scalia Law School, George Mason University, Before the United States House of Representatives Committee on the Judiciary, Subcommittee on Regulatory Reform, Commercial and Antitrust Law, International Antitrust Enforcement, Washington, D.C. May 19, 2017.

Of Course Collusion Should Be Prosecuted. But Maybe... Or (the Case for International Antitrust Agreements)

We study the incentives of competition authorities to prosecute collusive practices of domestic and foreign firms in a multi-market contact model between two firms operating in two countries. In equilibrium, the country of origin of the firms might prefer to delay prosecution to protect pro ts in foreign markets. This strategic delay is valuable because prosecution in the country of origin of the firms activates an information spillover that triggers prosecution in the foreign country. Prosecution delays, however, are not optimal from the point of view of global welfare, something that could be solved by integrating the competition authorities. With multiple industries, both countries can be better off under integration or signing an international antitrust agreement.

Statement of Thomas J. Horton, Professor of Law and Heidepriem Trial Advocacy Fellow, The University of South Dakota School of Law, Before the Subcommittee on Regulatory Reform, Commercial and Antitrust Law of the Committee on the Judiciary, United States House of Representatives Concerning International Antitrust Enforcement: China and Beyondd

Statement of Thomas J. Horton, Professor of Law and Heidepriem Trial Advocacy Fellow, The University of South Dakota School of Law, Before the Subcommittee on Regulatory Reform, Commercial and Antitrust Law of the Committee on the Judiciary, United States House of Representatives Concerning “International Antitrust Enforcement: China and Beyond”, June 7, 2016.

The U.S. Antitrust Laws in a Global Context

For more than a hundred and ten years, the U.S. antitrust laws have stood at the center of what loosely (and to some, heretically) could be called the industrial policy of the United States. Competition, undertaken by private economic actors and constrained only by rules designed to protect the integrity of the market itself, has been the force that has led to unparalleled economic success. There is much in these laws, however, that is rooted in the particular history and economic circumstances of the United States, starting with the name that they bear: antitrust. It is a quaint name, evocative of long-dead robber barons and swashbuckling Presidents. Other countries with more recently enacted laws give them the more straightforward label of “competition” laws–laws designed to protect competition and consumers. This Article will explore the extent to which the U.S. antitrust laws differ from the systems that have developed elsewhere, particularly in the European Union, a place whose competition regime is soon to be reflected in the national laws of more than twenty-five countries. Differences do exist, and it is worth identifying what those differences are, why they exist, and how they matter. We will see that those differences are important even now, not only to practitioners of the slightly esoteric field of “international antitrust,” but also to the rest of the antitrust bar. And the importance of understanding the way others view this field will only become greater over time; the ideas that our counterparts elsewhere have of competition law will inevitably affect the way that American firms do business, and possibly even the content of domestic U.S. antitrust law itself.

The Economics of Public International Law

This paper is a preliminary draft for eventual inclusion in the Handbook of Law and Economics, A. Mitchell Polinsky & Steven Shavell editors. It reviews and synthesizes the work of economists and law and economics scholars in the field of public international law. The bulk of that work has been in the area of international trade, but many of the ideas in the trade literature have implications for other subfields. Recent years have seen a significant increase in research on other topics as well. The paper begins with a general framework for thinking about the positive and normative economics of public international law, and then proceeds to a treatment of specific topics including customary law, strategic alliances and the laws of war, international trade, international investment, international antitrust, human rights law, conflicts of law, and the international commons (fisheries).

Book Reviews

Explores topics in the economic approach to international law. Discusses the fundamentals of international law; economic analysis of international law—the essentials; sovereignty and attributes of statehood; customary international law; treaties; international institutions; state responsibility; remedies; the intersection between international law and domestic law; treatment of aliens, foreign property, and foreign debt; the use of force; the conduct of war; human rights; international criminal law; international environmental law; the law of the sea; international trade; and international investment, antitrust, and monetary law. Posner is Kirkland and Ellis Professor of Law at the University of Chicago Law School. Sykes is Robert A. Kindler Professor of Law at the New York University School of Law.

Competition Policy for Industry Standards

This paper is a chapter in the forthcoming Oxford Handbook on International Antitrust Economics. The chapter surveys issues raised by the development of industry standards, whether accomplished through a formal standard setting committee structure or the activities of a single sponsor. The focus is on the tradeoff between the benefits from standards and possible costs that standards and the activity of standard development may impose on consumers. A particular focus is on the consequences of intellectual property rights for standards.

Competitiveness and Competition: International Merger Control from the Business Prospective

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.

International Antitrust Litigation. Conflict of Laws and Coordination

International Antitrust Litigation. Conflict of Laws and Coordination, 10.1628/003372513X665720, Jahrgang 77 (2013) / Heft 2, 0033-7250 (1868-7059), The Rabel Journal of Comparative and International Private Law

Cartels and Collusion - Empirical Evidence

Chapter prepared for publication in Oxford Handbook on International Antitrust Economics, Roger D. Blair and D. Daniel Sokol, editors. Cartels occur in a wide range of industries and engage in a wide range of behaviors in their efforts to increase profits. In this chapter, we discuss the wide variety of techniques that cartels use to increase prices and profits. Studies of national and international markets across the twentieth century find cartels in a wide variety of products and services, and these cartels typically last between five and eight years. The most important determinant of cartel breakup is effective antitrust policy. While it has often been presumed that cartels’ demise results from cheating by member firms tempted by short term profits, empirical analysis suggests that cheating rarely destroys cartels. The potential profits from collusion provide sufficient incentives for cartels to develop creative ways to limit the temptations that inevitably arise. While scholars and policy makers have often been concerned that business cycle downturns are associated with cartel formation, the evidence we review here does not suggest strong cyclical effects. There is evidence that cartels are formed during periods of falling prices, but these are more likely to be the result of market integration or an increase in competitive intensity than macroeconomic fluctuations. Similarly, cartel breakup does not evidence strong cyclicality.

Avoidance Techniques: State Related Defences in International Antitrust Cases

Despite its economic significance, competition law still remains fragmented, lacking an international framework allowing for dispute settlement. This, together with the growing importance of non-free-market economies in world trade require us to re-consider and re-evaluate the possibilities of bringing an antitrust suit against a foreign state. If the level playing field on the global marketplace is to be achieved, the possibility of hiding behind the bulwark of state sovereignty should be minimised. States should not be free to act in an anti-competitive way, but at present the legal framework seems ill-equipped to handle such challenges.This paper deals with the defences available in litigation concerning transnational anti-competitive agreements involving or implicating foreign states. Four important legal doctrines are analysed: non-justiciability (political question doctrine), state immunity, act of state doctrine and foreign state compulsion. The paper addresses also the general problem of applicability of competition laws to a foreign state as such. This is a tale about repetitive unsuccessful efforts to sue OPEC and recent attempts in the US to deal with export cartels of Chinese state-owned enterprises.

Resale Price Maintenance in the EU: In Statu Quo Ante Bellum ?

Resale price maintenance -a manufacturer requiring its dealers to sell its products at or above a given price- is a subject of much discussion among antitrust scholars. In the United States, minimum RPM was subject to a strict prohibition until in 2007 the Supreme Court in the Leegin case replaced the longstanding per se rule of Dr Miles (1911) by a “rule of reason” approach whose precise implications have yet to be defined.There is a widespread perception - ultimately incorrect - that minimum RPM constitutes a per se offence in Europe under Article 81 EC. Consequently, the Leegin decision raised expectations that the EU might also modify its approach on occasion of its ongoing review of vertical restraints. Yet, the European Commission's proposed Regulation and Guidelines, introduced for public comments on 28 July 2009, exhibit a fundamental continuity with the texts currently in force. This continuity was foreseeable with the proper understanding of the scope and nature of the rule against RPM in Europe. The first part of this article briefly summarizes and criticises, in a non-technical manner, some of the favourable and unfavourable views on RPM in the literature. The second part looks at the treatment of RPM under European competition law, and more specifically under the Verticals block exemption regulation.This paper was prepared for the 36th Annual Conference on International Antitrust Law and Policy (September 24 & 25, 2009) organised by the Fordham Competition Law Institute (FCLI), and will be published in the annual volume with the proceedings of the conference edited by Barry E. Hawk.

Multilevel Governance, Lead Jurisdiction Concepts and Global Competition [Mehr-Ebenen-Governance, Leitjurisdiktionskonzepte Und Globaler Wettbewerb

This paper discusses the prospects and limits of combining the governance principles of multilevel governance and lead jurisdictions models for international antitrust. In doing so, it targets to contribute bridging a gap in the current world economic order, i.e. the lack of supranational governance of private international restrictions to market competition. Competition policy on the global level restricts itself to the selection and appointment of appropriate lead jurisdictions for concrete cross-border antitrust cases, while the substantive treatment remains within the competence of the existing “national” antitrust regimes. Further research about lead jurisdictions as an innovative mode of global governance is advocated.

Competition Policy in the Global Economy: An On-Line Case Book

This on-line casebook examines the fields of international antitrust and international trade law. In general, it examines how the United States and other jurisdictions regulate competition among firms which do business abroad. This will include how competition policy regulates individuals and firms located outside the United States in their competition with United States firms as well as the rules governing United States firms. These materials are intended for use in a U.S. style law school class or seminar and designed to provide the base knowledge necessary to engage in sophisticated research in the field and to produce a research based paper of 20-25 pages in length. By necessity, these materials are in English and have primarily a United States focus. The value of an on-line casebook in this field goes beyond the merely the cost savings and convenience. It is also an opportunity for a collaborative exercise that will allow for the creation of a more in-depth and creative set of materials that can be done in traditional hard cover format. Use of the casebook for educational purposes with attribution is available on a royalty-free basis under a Creative Commons Attribution-Share Alike 3.0 United States License. For all other uses please contact Professor Waller at the Institute for Consumer Antitrust Studies at Loyola University Chicago School of Law. I therefore invite any competition law teacher or scholar to submit additional chapters on other competition law topics or jurisdictions not covered in these materials for inclusion in future iterations of these materials. Materials must be original or accompanied with proof of permission/license to use for this purpose and be in English and in either Word or Word Perfect. Submission of materials constitutes your permission to include the material in future editions of the on-line casebook for educational purposes with attribution available on a royalty-free basis under a Creative Commons Attribution-Share Alike 3.0 United States License. Submission of materials also constitutes permission to edit the submitted material for style, content, and compatibility with the existing text, although every reasonable effort will be made to allow you to review edited material before posting on-line. I look forward to working with the global competition law and policy community to make this the most effective and interesting teaching tool possible.

International Antitrust Enforcement and Multi-Market Contact

This paper analyzes international antitrust enforcement when multinational firms operate in several markets with antitrust authorities in each market. We are concerned with how the sustainability of collusion in one local market is affected by the existence of collusion in other markets when they are linked by demand relationships. The interdependence of collusion sustainability across markets leads to potential externalities in antitrust enforcement across jurisdictions. As a result, cartel prosecution can have a domino effect with the desistance of one cartel triggering the internal break-up of the cartel in the adjacent market. We further find that the equilibrium in antitrust authorities’ enforcement decisions may exhibit non-linearity due to a free-rider problem as the global economy is more integrated. We also analyze the equilibrium antitrust enforcement and compare it with the globally optimal antitrust enforcement policy.

WHAT DO WE REALLY KNOW ABOUT EXPORT CARTELS AND WHAT IS THE APPROPRIATE SOLUTION?

This article responds to Florian Becker's article in this journal, The Case of Export Cartel Exemptions: Between Competition and Protectionism. Professor Becker provides a number of insights into various approaches that battling export cartels may take. I take issue with three of Becker's main themes. First, Becker underplays the importance of political economy issues in the creation and perpetuation of export cartel exceptions from antitrust. A public choice understanding of export cartels is critical to formulating any effective remedy for export cartels. Second, Becker assumes that export cartels are hard-core cartels and that they are a serious problem in international antitrust. In fact, there is very little empirical data on export cartels and nearly all of it comes from the United States. Therefore, it is difficult to say with any great certainty whether export cartels are a problem and how serious a problem they are. Third, Becker ignores the role that international organizations such as the OECD and ICN can play to reduce the effects of export cartels. After surveying different possible solutions, I propose a WTO transparency regime to address export cartels more effectively.