International Competition Network Research Articles

RETRACTED: Cross-Border Cartels Enforcement Under the Africa Continental Free Trade Area

Effective enforcement of competition laws on a global scale is a prerequisite for open economies, fair trading conditions, and level playing fields, and ultimately, inclusive economic development for improved and better lives. Improving enforcement co-operation between competition authorities has been a priority for the Organization for Economic Co-Operation and Development, United Nations Conference on Trade and Development, and International Competition Network for many years. This article argues that there is increased scope for competition authorities in Africa to effectively regulate cross-border cartel activities under the Africa Continental Free Trade Area (AfCFTA). It is recognized that for the AfCFTA to meet its general objectives under Article 3 of the AfCFTA framework agreement, States Parties must develop a framework on competition policy which is part of the second phase of the negotiations that will culminate into a Protocol on Competition Policy. Following a review of competition policies and laws of selected African countries in Southern African Development Community, East African Community, Economic Community of West African States, and Common Market for Eastern and Southern Africa, this article suggests an appropriate competition law and policy for Africa, particularly one that will enhance capability to combat cross-border cartels.

In the absence of global antitrust law: looking to “bricks and mortar” institutions and agency networks

PurposeThis paper aims to draw attention to a broad range of experimental institutional initiatives which operate in the absence of a global antitrust regime. The purpose of this paper is to offer food for thought to scholars in other fields of international trade law facing challenges from divergent national regimes.Design/methodology/approachTaking inspiration from political science literature on institutions, this paper crafts a broad analytical lens which captures various organisational forms (including networks), codes (including soft law) and culture (including epistemic communities). The strength and shortcomings of traditional “bricks and mortar” institutions such as the European Union (EU) and General Agreement Tariffs and Trade/World Trade Organisation are first examined. Then, the innovative global network of International Competition Network (ICN) is analysed.FindingsIt highlights the value of the global antitrust epistemic community in providing a conducive environment for extensive recourse to “soft law”. Examples from the EU and the ICN include measures which find expression in enforcement tools and networks. These initiatives can be seen as experimental responses to the challenges of divergent national antitrust regimes.Research limitations/implicationsIt is desktop research rather than empirical field work.Practical implicationsTo raise awareness outside the antitrust scholarly community of the variety of experimental institutional initiatives which have evolved, often on a soft law basis, in response to the challenges experienced by national enforcement agencies and businesses operating in the absence of a global antitrust regime.Originality/valueIt offers some personal reflections on the ICN from the author’s experience as a non-governmental advisor. It draws attention to the ICN’s underappreciated range of educational materials which are freely available on its website to everyone. It submits that the ICN template offers interesting ideas for other fields of international trade law where a global regime is unrealisable. The ICN is a voluntary virtual network of agencies collaborating to agree ways to reduce clashes among national regimes. Its goal of voluntary convergence is portrayed as standardisation rather than as absolute congruence. Even if standardisation of norms/processes is too ambitious a goal in other fields of international trade law, the ICN model still offers inspiration as an epistemic community within an inclusive and dynamic forum for encouraging debate and creating a culture of learning opportunities where familiarity and trust is fostered.

The Globalization of Antitrust: History and Prospects

The United States stood virtually alone when it enacted its first antitrust statute in 1890. Today, almost all nations have adopted competition laws (the term used in most other nations), and US antitrust agencies interact with foreign enforc-ers on a daily basis. This globalization of antitrust is becoming increasingly important to the economic welfare of many nations, because major businesses (in particular, massive digital platforms like Google and Facebook) face grow-ing antitrust scrutiny by multiple enforcement regimes worldwide. As such, the United States should take the lead in encouraging adoption of antitrust policies, here and abroad, that are conducive to economic growth and innovation. Anti-trust policies centered on promoting consumer welfare would be best suited to advancing these desirable aims. Thus, the United States should oppose recent efforts to turn antitrust into a regulatory system that seeks to advance many objectives beyond consumer welfare. American antitrust enforcers should also work with like-minded agencies—and within multilateral organizations such as the International Competition Network and the Organisation for Economic Co-operation and Development—to promote procedural fairness and the rule of law in antitrust enforcement.

The International Regulation of Competition Policy and Government Procurement: Exploring the Boundaries of the Trade Regime

ABSTRACT The proliferation of ‘behind-the-border’ issues has become a major challenge for the global trading system. Why are some trade-related issues integrated in the strongly judicialized WTO with its dispute settlement system, while others are governed in isolation from the trade regime? Contributing to the literature on WTO issue boundaries, the paper highlights the role of uncertainty and demand for transgovernmental regulatory cooperation as drivers of regime outcomes. I argue that high technical and political uncertainty delays GATT/WTO integration of trade-related issues in favour of a soft-law trade pathway. A further-reaching separation from the trade regime occurs when uncertainty remains high and national regulatory authorities exhibit a demand for trade-separate cooperation with foreign counterparts. Case studies on government procurement and competition policy substantiate the argument. Government procurement has been integrated into the GATT/WTO trade regime under a market access agenda pursued by EU and US trade actors, but only after uncertainty had been reduced in technical soft-law trade talks at the OECD. Conversely, in competition policy – despite repeated efforts at GATT/WTO integration – cooperation has thrived in less judicialized transgovernmental networks such as the International Competition Network, driven by competition agencies eager to solve regulatory cooperation problems independently from the trade regime.

Assessing Monopoly Power or Dominance in Platform Markets

The proper assessment of monopoly power or dominance in platform markets is a hot topic of debate and study, including by competition agencies around the world and the multilateral organizations in which they participate. For example, the International Competition Network is currently gathering feedback from agencies and non-governmental advisors in response to its questionnaire on the topic. This note draws on the existing economics literature to provide responses to some of the key questions being studied. Topics include: whether to define one integrated market or two separate-product markets; the use of market shares as a proxy for monopoly power; potential barriers to entry such as network effects, data, user switching costs, and consumer biases (e.g., consumer inertia or default settings); and the role of multihoming.

The Economics of International Competition Policy: New Challenges in the Light of Digitization?

The International Competition Network (ICN) celebrates its 20th birthday in 2020. It governs global competition by providing a cooperative forum for (mostly national) competition authorities from all around the world. In the absence of binding global competition rules and antitrust laws, it attempts to coordinate national and supranational competition policies by providing best practice recommendations and exercising peer pressure on deviating regimes. While the first twenty years of the ICN have been mostly a success story, the ubiquitous process of digitization poses new challenges to the voluntary and informal coordination of decentralized competition policies governing pro- and anticompetitive arrangements and conduct on international and intercontinental markets. First, the digitization of markets and goods increases the number of cross-border, interjurisdictional cases regarding cartels, mergers and acquisitions, as well as anticompetitive market behavior. Second, digital platforms and data-based business models increase the probability of dominant companies on intercontinental scales as well as problems of economic dependency on few global player companies. Third, the economics of digital platforms and data-based competition strategies partly differ from traditional standard economics and are still being developed in the academic world. Consequently, the previous convergence of competition policy practices across jurisdictions tends to shift towards a process of divergence with respect of how to deal with innovative pro- and anticompetitive conduct in the digital world. This essay discusses the influence of the effects from digitization on the problems of (only soft-coordinated) national competition policies in international markets like cross-border externalities, costs and burden of multiple procedures, loopholes in the protection of global competition, and the diversity of societies and competition regimes. It concludes by outlining the challenges that the ICN will face in its third decade.

The International Competition Network (ICN) and the Framework on Competition Agency Procedures (CAP): Strengthening Fairness in Competition Law Enforcement

The International Competition Network (ICN) and the Framework on Competition Agency Procedures (CAP): Strengthening Fairness in Competition Law Enforcement

The Impact of the International Competition Network on Competition Advocacy and Global Competition Collaboration

The International Competition Network (ICN) is an informal, virtual network that seeks to facilitate cooperation between competition law authorities globally. This study attempts to determine the impact of the ICN on competition advocacy and global competition collaboration. It does so by examining the impact of the ICN’s Advocacy Working Group’s activities on ICN members’ domestic legislation and analyzing whether the ICN can help domestic competition authorities cooperate in international matters in two principal ways. First, the article assesses the impact of ICN efforts on legislation and international collaboration with respect to competition policy as well as working methods to deal with multinational cases. Second, the article identifies the strengths and weaknesses of ICN strategies and provides recommendations on how to enhance ICN’s operations. These two methods of analysis help to determine if the ICN could serve as the basis for a new approach to address competition issues globally.

Influence in the International Competition Network (Icn): Who Seeks It, How Do They Do This and Why?

Influence in the International Competition Network (Icn): Who Seeks It, How Do They Do This and Why?

To What Extent, If at All, Is It Desirable or Realistic to Aim for a Global Agreement on Competition Policy?

The pursuit of a globally recognised competition policy appears to be endless at this point in time. Lack of cohesion among global institutions and an inability to forego certain differences to achieve a suitable global policy are just some of the reasons examined in this brief essay on why such a global competition is an unrealistic expectation currently. This essay examines 3 institutions that formulate global competition policy, the World Trade Organisation, the Organisation for Economic Cooperation and Development and the International Competition Network. While these powerful policymakers have made efforts to try and achieve as coherent a policy as possible, their inevitable shortcomings and disadvantages as forums for discussing and implementing internationally recognised competition policy is well examined. The relative infancy of competition law in many developing countries has also led to a situation where these developing countries implement a competition policy based on the needs and specific interests of developed countries. This practice is clearly counter-intuitive but is a practice that is widespread and almost impossible to reverse. This essay also analyses the costs of implementing a global agreement on competition policy, the obstacles such an agreement would actually create and the general difficulty states have encountered when trying to reach such an agreement.

Procedural Fairness in Antitrust Enforcement: The U.S. Perspective

Due process and fairness in enforcement procedures represent a critical aspect of the rule of law. Allowing greater participation by the parties and making enforcement procedures more transparent serve several functions, including better decision-making, greater respect for government, stronger economic growth, promotion of investment, limits corruption and politically motivated actions, regulation of bureaucratic ambition, and greater control of agency staff whose vision do not align with agency leadership or who are using an enforcement matter to advance their careers. That is why such distinguished actors as the International Competition Network (ICN), the Organization for Economic Cooperation and Development (OECD), the Association of Southeast Asian Nations (ASEAN), the International Chamber of Commerce (ICC), and the American Bar Association (ABA) have all offered frameworks for promoting greater fairness in antitrust enforcement. Because the U.S. was the first country to enact an antitrust law, it has enjoyed the longest opportunity to develop its enforcement practices. As such, after first introducing the key antitrust enforcement institutions, this chapter will explore the manner in which U.S. implements four key procedural protections (legal representation, notice of the legal basis and evidence underlying the alleged violation, engagement between the parties and the investigative staff, and internal checks and balances/judicial review) to provide insights into ways to improve U.S. law and in the hopes that other jurisdictions might benefit from the U.S. experience.

Failed WTO Platform for Competition Law Convergence: Evolving Alternate Regime of Mous on Internationalization of Competition Law

In July 2004, the Working Group on Interaction between Trade and Competition Policy at WTO was made inactive post decision by General Council at Cancun as the proposal to have a formal multilateral framework to enhance the contribution of competition policy to international trade and development agreed to at Doha could not be taken forward. WTO Platform could not be an appropriate forum for having international competition law regime because of the inherent conflict between national competition legislations and international trade principles. For example, in cases of export cartels, while the national trade measure by a country may be perfectly right, under WTO scene, it facilitates anticompetitive conduct. Further, the conflict between developed and developing countries posed another problem. However, international business requires convergence on at least basic principles of competition law which was attempted by UNCTAD long back in 1980s by proposing a Model Law on Competition which is still being negotiated. WTOs failure led to evolution of the regime of MOUs in which the countries entered into soft agreements in the nature of bilateral (EU-US 1991 agreement), multilateral (ICN, OECD), and regional (ASEAN) including the recent class of Free Trade Agreements (India-EU FTA). This evolution has given rise to a fresh concept of internationalization of competition law which aims towards convergence. The International Competition Network (ICN) has further evolved as a specialized though informal venue for about 120 plus competition agencies to thrash out completion principles aiming towards convergence. The present paper seeks to trace this evolution and evaluate the present position in this regard. The paper would be divided into four parts. The first part would provide an introduction and historical background to internationalization of competition law. Second part would deal with WTO work. The third part would discuss the bilateral MOUs and the fourth part would delve into the newer forms of platform leading to convergence. The paper would seek to assess how far these platforms have been successful in achieving convergence especially in view of hard-core cartels and some of the latest trends of extraditing the violators of competition law across countries like Ian Norris.

Regulatory Networks, Legal Federalism, and Multi-Level Regulatory Systems

Transnational regulatory networks play important roles in multi-level regulatory regimes, as e.g, the European Union. In this paper we analyze the role of regulatory networks from the perspective of the economic theory of legal federalism. Often sophisticated intermediate institutional solutions between pure centralisation and pure decentralisation can help to solve complex tradeoff problems between the benefits and problems of centralised and decentralised solutions. Drawing upon the insights of the political science literature about regulatory networks, we show that regulatory networks might be an institutional innovation that can fulfill a number of functions (rule-making, best practices and policy learning, effective enforcement, conflict resolution) that might allow for a better intermediate solution between centralised and decentralised regulatory powers. We apply our approach in three case studies to very different regulatory networks, the Body of European Regulators for Electronic Communication (BEREC), the European Competition Network (ECN), and the International Competition Network (ICN). An important result is that regulatory networks might not only be a temporary phenomenon but part of long-term institutional solutions in European multi-level regulatory regimes.

The promise and potential of transgovernmental cooperation on the international data privacy agenda: Communicative action, deliberative capacity and their limits

One of the great oxymorons and paradoxes of information technology regulation is that the governance of data privacy around the world to a large extent occurs through transgovernmental cooperation by data privacy commissioners; however, it has hardly received any attention among legal or political science scholars. Despite an increasingly prominent role that data privacy is gaining on an inter-governmental level and the United Nations agenda, an international community still struggles to find ways to cooperate over data privacy regulation. This paper aims to contribute to the international data privacy discourse by analysing data privacy authorities' (‘DPAs’) prospects to influence the international data privacy agenda and cooperation. The article aims to build upon and go beyond the existing descriptive narratives of the DPAs' functions and networks by applying the theoretical framework of the transgovernmental networks and Habermas theory of communicative action to data privacy to examine the potential and limits of the transgovernmental cooperation among the DPAs beyond European level which has not been analysed yet in legal or political science scholarship. The paper argues that while the transgovernmental cooperation by data privacy authorities represents a significant governance alternative to the more conventional inter-governmental cooperation, it is questionable whether that is sufficient to de facto alter the cooperative stalemate between the EU and USA and change the regulatory landscape in data privacy governance on an international level. While the hopes for data privacy commissioners could be high, the experience in other issue-areas, even the ones that are considered very ‘successful’ examples of transgovernmental cooperation, such as the Basel Committee, International Organization of Securities Commissions, and International Competition Network, requires some caution. This is so given that many of the factors impeding cooperation in other areas, including incompatible regulatory philosophies, politicisation of issues, the limited ability of regulatory cooperation to bind other governmental actors, and the presence of distributive conflicts, appear to be present in the area of data privacy as well. Thus, the paper concludes that aspirations that the data privacy authorities may, in the words of Anne-Marie Slaughter, create ‘a genuinely new set of possibilities’ for a future governance of data privacy where deliberation takes over and eliminates the power disparities and national interests are likely to remain elusive at least in the nearest future.

Competition between public and private undertakings

Abstract An undistorted competition regime can only be achieved on the condition of equality of opportunity among different businesses. The neutrality principle must be also applicable in favor of public sector undertakings according to OFT study dated 2010 and OECD study 2012. In comparative analysis with other member states (Italy and Spain) and Australia the relevant legislations provide the Competition Agencies and the Governments power to ensure and protect the neutrality principle. World Trade Organization is the new forum for international regulation of public restraints? It is a question to be answered. A “soft” solution (soft law), either in the framework of the International Competition Network (ICN) or in the framework of OECD or of the UNCTAD seems realistic. Perhaps more effective seems to be the cultivation of a competition culture (competition advocacy). In competition law, “second best” solutions constitute the reply to the problem.

Procedural Powers in Competition Enforcement: A Look at Inspections

Competition enforcement is characterised by asymmetric information and Competition Authorities have been provided with inspection powers to reduce the informative gap. The paper looks at competition inspections from different perspectives. First of all, the paper analyses convergences of principles and divergences of rules between different competition systems starting from two wide analyses carried out by the European Competition Network in 2012 and by the International Competition Network in 2013. Secondly, it tries to look at competition inspections from the point of view of undertakings, especially describing the practice of adopting Guidelines and internal rules for giving instructions to be followed during a competition inspection but also mentioning the costs of inspections, the duty of undertakings to cooperate during inspections (and sanctions for non-compliance) and – finally – the limits to the same power of inspection.Moreover, the point of view of Competition Authorities has been taken into account, with particular regard to the questions of planning inspections, administrative capacity in performing inspections and international cooperation in competition inspections.

Effectiveness of Enforcement Cooperation in Developing Countries: What Role Can Existing Institutions Play?

As trade liberalization has progressed, the gap between the rapid internationalization of markets and the fragmentation of the systems of domestic antitrust laws has meant that competition authorities especially in developing countries have experienced considerable difficulties in fighting the transnational anticompetitive practices which originate abroad but have a negative effect on their domestic markets or to adequately intervene against transnational transactions initiated in other countries but affecting their home markets. To try to address this problem, the international competition community has experimented with a number of possible solutions ranging from a failed attempt to promote a multilateral cooperation system in the area of competition to voluntary bilateral cooperation agreements between developed and developing countries, to the creation of an organization meant to facilitate cooperation in the field of antitrust, the International competition network. So far, those solutions have been mostly unsuccessful (in terms of avoiding international restrictions of competition) and frustrating (since cooperation has proved to be much more difficult than expected) especially for developing countries. Regional agreements on cooperation in competition were considered to be more promising largely because it was believed that the cooperating countries may have more of an incentive to cooperate than pairs of developed and developing countries unequal in size and with different stakes and unbalanced trade flows. However the lack of sufficient financial resources and insurmountable jurisdictional problems have so far impeded for the regional agreements in developing countries to achieve tangible results. Developing countries have to be more inventive and find less costly ways to cooperate. Many steps forward are possible, even without creating supra-national authorities. The example of Australia and New Zealand can be of some help.As for convergence on the procedural and substantive aspects of antitrust law, the OECD, UNCTAD and the ICN all play an important role, with the ICN, specifically designed to meet the challenges facing developing countries. However in order to become more effective in achieving its objectives, the ICN would have to overcome a number of organizational challenges so as to better engage non OECD countries in its activities and ensure that the identification of best practices actually lead to the reduction of transaction costs of firms and to the the creation of a level playing field in terms of procedures and substantive prohibitions.

Science, Politics and Transnational Regulation: Regulatory Scientific Institutions and the Dilemmas of Hybrid Authority

AbstractThe main objective of this article is to develop a better understanding of the structure of transnational regulatory scientific institutions (RSIs). We will argue that the hybrid political-legal-epistemic nature of RSIs creates a continual tension between their hierarchical and policy-driven structure and the paradigms of objectivity, parallelism and non-centralism that characterize science. The article examines the way in which RSIs cope with the challenge of maintaining their epistemic/political authority against the tensions generated by their hybrid structure. The article focuses on three institutions: the Intergovernmental Panel on Climate Change (IPCC), the International Commission on Non-Ionizing Radiation Protection (ICNIRP), and the International Competition Network (ICN), and examines how this challenge manifests itself in the context of these three bodies. The article links the discussion of hybrid authority with the problem of scientific uncertainty. It concludes with a discussion of the optimal design of RSIs.

Competition Policy and Poverty Reduction: A Holistic Approach

This paper examines the role of competition law and policy as tools for poverty reduction and development. The authors put forward five related principles, building upon the important work on related issues that has been done by the OECD, the International Competition Network (ICN), UNCTAD and civil society organizations such as CUTS in recent years, in addition to the earlier work done on these topics in the WTO Working Group on the Interaction between Trade and Competition Policy when that body was active from 1997 through 2003. Together, these principles comprise the holistic approach to competition law and policy which is referenced in the title of the paper: * First, the focus of policy makers in using competition policy as tool for poverty reduction should be on approaches that are relatively easy to implement but have a trackrecord of being effective and economically sound. * Second, for competition policy reforms and legislation to be successful, public acceptance and support is critical and must be an essential focus of related initiatives. * Third, to serve as an effective tool of poverty reduction, competition policy needs to address the needs of the citizens of poorer societies in their capacities as producers (and, therefore, as users of extensive input goods and services, including public infrastructure), in addition to their capacities as final consumers/households. * Fourth, it is posited that competition policy is more than just what competition agencies do and includes the full spectrum of measures that governments employ to enhance competition and improve the performance of markets. * Fifth, in order to address the challenges posed by the changing landscape of competition policy worldwide, new forms of international co-operation may need to be considered. The paper then develops the application of these principles with respect to five specific areas in which competition policy can contribute to poverty reduction, namely: (i) the reform of public and business infrastructure sectors, particularly in the context of developing and transition economies; (ii) the complementary roles of competition law enforcement and market liberalization in public procurement markets; (iii) various related dimensions of competition policy as they relate to public health objectives; (iv) the addressing of possible monopsonistic practices in international supply chains that may affect the ability of developing country producers to reap gains from participation in international markets; and (v) measures to address the enduring problem of international cartels which, despite an impressive record of prosecutions by developed jurisdiction competition agencies over the past decade, continue to impose substantial costs on developing economies. The paper concludes with some observations regarding the future of international cooperation in the competition policy sphere.

Questions of Legitimacy in the Europeanization of Competition Law Procedures of the EU Member States

As less formal institutions such as the European Competition Network or the International Competition Network are becoming generators of soft law that may harden into national, EU or international law, the importance of legitimacy in agenda-setting and in the development of best practices, rules, and standards increases. This paper discusses the legitimacy of the harmonization process which takes place in the European Competition Network(ECN) on the basis of Regulation 1/2003, with regard to the administrative procedures of the Member States the NCAs apply when they enforce EU competition rules. This harmonization process is seemingly the result of voluntary harmonization among the Member States but in fact it is being steered and dominated by the EU Commission. This paper will examine the role of the Commission in initiating harmonization of national administrative procedures and institutional settings of the Member States by analyzing the Report on the functioning of Regulation 1/2003 and the Commission Staff Working Paper accompanying the Report on the functioning of Regulation 1/2003 , as well as through the recent work of the European Competition Network’s Working Group on cooperation issues and due process. The paper will look at the centripetal and centrifugal effects Regulation 1/2003 had on the substantive and procedural rules as well as the institutions of the Member States’ competition law. The paper critically assesses the methods of voluntary convergence that is taking place among the Member States and the way the Commission extends harmonization of the administrative procedural rules as well as certain substantive rules in the EU Member States.