Price-fixing Agreements Research Articles

PERLINDUNGAN HUKUM BAGI KONSUMEN AKIBAT PRICE FIXING AGREEMENT PADA TARIF ANGKUTAN UDARA YANG MENYEBABKAN PERSAINGAN USAHA TIDAK SEHAT

A price fixing agreement is an agreement practice entered into by companies in the same industry to fix prices for goods/services together in the relevant market. Price fixing agreements on air freight rates have a negative impact on business competition, especially for consumers who use air transport services. This study aims to determine the form of price fixing agreement practices on air freight rates and the form of legal protection for consumers against price fixing agreements on air freight rates. This research uses normative legal research methods through literature study. The results of this study indicate that business actors who enter into price fixing agreements to increase the price of airplane tickets beyond the specified tarif limit have violated the provisions of business competition law, which can harm consumers. The legal protection provided to consumers in the form of preventive legal protection and repressive legal protection depends on the jurisdiction and the applicable legal framework.

ANTICOMPETITIVE PRICE FIXING IN DISTRIBUTION AGREEMENTS – ECJ C-211/22, SUPER BOCK V. PORTUGUESE COMPETITION AUTHORITY

On June 29, 2023, the judgment concerning the case C-211/22, Super Bock v. Portuguese Competition Authority, was released by the European Court of Justice (“ECJ”). This judgment delivers a comprehensive review of fundamental competition law principles pertaining to vertical agreements. In this judgement was examined the business approach of Super Bock, a manufacturing Portuguese company. The preliminary ruling emphasizes to the court referring the case the vital distinction between hardcore restrictions as defined by the Vertical Block Exemption Regulation (VBER) and competition-constraining practices falling within the purview of Article 101(1) of the Treaty on the Functioning of the European Union (TFEU). Furthermore, the ruling clarifies the expansive scope of the term “agreement” according to Article 101(1) of the TFEU, while also highlighting the array of (both direct and indirect) evidence that can substantiate the identification of an agreement. In alignment with established legal precedents, ECJ reinforces the principle that an agreement encompassing nearly the entire geographical expanse, though not entirely exhaustive, of a Member State can still impact the inter-member trade. Vertical agreements involve relationships between entities at various levels of the supply chain, such as manufacturers and distributors. The key aspects addressed in this judgment have direct relevance to how manufacturers interact with their distribution networks and set pricing policies, which in turn can affect market dynamics and competition within the manufacturing industry. The Super Bock v. Portuguese Competition Authority judgment serves as a pivotal milestone in clarifying the legal framework governing vertical agreements in the European Union. Its comprehensive analysis of competition law principles provides valuable guidance to businesses operating within the EU, ensuring a more transparent and predictable regulatory environment for vertical agreements and, consequently, fostering healthy competition in the market. The ECJ confirmed for the first time the established EU law principles regarding vertical price-fixing agreements. It emphasizes that an agreement should not rigidly be classified by actions without considering the broader context. Although deviating from stricter framework centered on the primary purpose and severe restrictions may complicate the application of the law, this ruling encourages a more thoughtful evaluation of vertical agreements and their overlap with competition law.

Does Enforcement of the Cartel Prohibition in Healthcare Reflect Public and Political Attitudes Towards Competition? A Longitudinal Study From the Netherlands

Abstract In market-based healthcare systems, due to the high and increasing degree of integration between healthcare providers and purchasers, the enforcement of the cartel prohibition is both important and ever more complex. Competition authorities operate independently, but their approach to enforcement may be influenced by the public and political context. Within the setting of the Dutch healthcare system, we study how the cartel prohibition was enforced between 2004 and 2020 and focus on whether a relationship with public and political attitudes towards competition in healthcare can be observed. Using both qualitative and sentiment analyses, we assessed 38 formal and informal documents issued by the competition authority, 126 written parliamentary questions and almost 1,500 newspaper articles. Our findings reveal that during the first half of the study period (2004–2012), ex-post punitive formal enforcement of violations of the cartel prohibition, such as market-sharing and price-fixing agreements, predominated. During the second half of the study period (2012–2020); however, the competition authority’s focus seems to have shifted toward providing ex-ante informal guidance. We clearly observe negative public and political attitudes towards competition in healthcare as well as a distinct shift in enforcement of the cartel prohibition in Dutch health care. However, we are not able to test for a causal relationship between both observations.

Cartel Indications on Determination of Loan Interest Rate in Fintech Lending

<em>The application of information technology platforms that appear in business transactions in Indonesia is a pattern of business models that cannot be avoided. One of the rapidly growing technology companies is an online loan service.The ease of borrowing funds through these services supports business growth. In contrast to the banking sector, which is regulated by a series of strict government regulations and the determination of interest rates that have been determined by looking at economic conditions. The absence of regulation in the legislation makes AFPI set the limit for determining the maximum interest rate, but the determination of interest rates by AFPI is suspected to lead to cartel actions. There is a close relationship between fair business competition and consumer protection. This research is a normative juridical research with a statutory approach and a comparative approach. In this case, the setting of interest rate limits will reduce consumers’ rights to get competitive prices. The existence of conscious parallelism by the AFPI on the LPMUBTI services can be categorized as a price fixing agreement. It is because the determination of the maximum interest rate limit is not regulated through direct government regulations.</em>

PEMAKNAAN ISTILAH TINDAKAN BERSAMA (CONCERTED ACTION) DALAM PERJANJIAN PENETAPAN HARGA (STUDI PUTUSAN KPPU NOMOR 04/KPPU-I/2016 DAN NOMOR 15/KPPU-I/2019)

There is no explicit explanation of the term concerted action in Law Number 5 of 1999, but this term is often used by the KPPU to uncover cases of cartels and price fixing. Therefore, it is necessary to raise the issue of how to interpret the term concerted action in price fixing agreements according to Article 5 of Law Number 5 of 1999 and its implementing regulations; and how the KPPU applies the concerted action qualifications in Decision Number 04/KPPU-I/2016 and Number 15/KPPU-I/2019. The study uses a normative method, which is equipped with the result of interviews. The results of research show that the meaning of concerted action in the form of a meeting of minds from business actors is realized in verbal agreements which are followed up with actions aimed at gaining profit. The application of concerted action in KPPU decisions is to contain four (4) elements which include the meeting of mind, a verbal agreement followed by concerted action and changes in market conditions which cause price increases. The KPPU should complete the guidelines by explicitly stating joint actions, and business actors should prepare compliance guidelines as a means of preventing violations of Law Number 5 of 1999

SANKSI TERHADAP PERJANJIAN PENETAPAN HARGA (PRICE FIXING) PADA SEKTOR JASA PENGANGKUTAN UDARA (Analisis Putusan KPPU Nomor 15/KPPU-I/2019)

This study discusses the sanctions imposed by the KPPU in the price fixing agreement and how the Commission Council considers the price fixing agreement. This research uses normative legal research, with the research approach used in this study using a statutory approach and a case approach and the data collection method in this research is library research. The results of this study are that the administrative sanctions imposed on the Reported Parties in this decision are only to notify the Business Competition Supervisory Commission in writing before taking any business actor policies that will affect the business competition map. The reported parties should be subject to administrative sanctions in the form of fines. However, due to the ratification of Law Number 11 of 2020 concerning Job Creation, especially Article 48 and also Article 49 concerning additional penalties in this Law, it was removed. Then, according to Article 5 of Government Regulation Number 44 of 2021, especially in paragraph (1) letter c, the Commission Council in deciding this case considered a clear reason, namely the Corona Virus Disease 2019 (COVID-19) Pandemic. So, the Reported Parties in this case were only given administrative sanctions and they were not given. Then, in deciding the case, the Commission Council considered it from the philosophical, sociological and juridical aspects.

The Concept of Hedging Instrument Forward In Islamic Economic Perspective

This research aims at explaining more in-depth about Islamic hedging related to the problem of muwa’adah status in Islamic hedging. The use of muwa’adah as an Islamic hedging instrument which promises to carry out transactions in the future, actually still becomes a subject of debate since there are some different opinions about whether or not it is permissible to carry out the concept of muwa’adah in a transaction. This research is descriptive qualitative research and uses qualitative data analysis, by conducting a direct analysis of the hedging scheme through the process of data reduction, data display, and verification. The results of this study reveal that in sharia hedging, swap and forward contracts should not be used, because swaps and forwards contain elements of usury. While the option contract contains speculation (maysir). If the forbidden aspects (haram) in ‘forward’ and ‘swap’ instruments are analyzed, generating al-sharf al-ajil and maysir (khathar/speculation), then the alternatives are 1) forward agreement by way of a price-fixing agreement; 2) bay’ al-iltizam; 3) bay’ al-‘urbun; and 4) al-bay’ bi al-shart.

QUAIS CARACTERÍSTICAS DOS ACORDOS DE FIXAÇÃO DE PREÇOS ESTÃO RELACIONADAS A UM MAIOR DANO AOS CONSUMIDORES?

ABSTRACT Despite the deterrence effect generated by antitrust laws, the fact is that many collusive agreements end up forming in the economy. An essential task is to understand how distinct market characteristics affect cartel profits and damages. This paper develops a theoretical model to assess which characteristics of price-fixing agreements are related to greater damage to consumers. Results indicate the following characteristics as responsible for greater damage: higher product similarity (substitutability); lower elasticity of demand (in absolute values); greater number of members; higher demand potential; and a higher velocity of transactions. Price-fixing agreements that have these characteristics more intensely, in comparison to others, tend to be more harmful to consumers, and, therefore, should be prioritized by antitrust authorities regarding detection, prosecution, and punishment.

Price-Fixing Agreements and Financial Reporting Opacity

Price-Fixing Agreements and Financial Reporting Opacity

Partial Price-Fixing and Semi-Collusion

Many cartels do not directly fix the price of products. Instead, the participants may agree on a starting price for negotiations or the price of a component of the overall price. Antitrust investigations reveal that cartel agreements are also often very imperfectly implemented. Antitrust law in the United States and the European Union has typically taken a robust approach to these practices even where economic analysis might be unable to show that such practices always or almost always harm consumer welfare. The decision of the New Zealand Supreme Court in Lodge Real Estate Ltd. v. Commerce Commission offers a New Zealand perspective on the concept of a price-fixing agreement and imperfect collusion. The Court, this article argues, reached the correct decision in Lodge. The decision, however, evidences a pragmatic judgment, rather than the confident deployment of economic learning or foreign case law within the statutory framework of the Commerce Act 1986. The language of sections 30 and 30A of the Act was borrowed from an Australian statute, which in turn had attempted to capture the state of United States price-fixing law in the 1970s. A more formalistic and pre-Chicago approach to antitrust is evident in the language, much of which was inspired by United States v. Socony-Vacuum Oil Co. The case also highlights some of the distinctive features of the competition law in New Zealand. The reluctance to develop to guide in the application of the general provisions of the Commerce Act and requiring a demonstration of an effect on price on the facts may mark a departure from the body of pricing case law in the United States and the European Union and risks undermining the per se prohibition of cartel conduct in the Commerce Act. Without the same depth and breadth of cartel case law, the adoption of a more flexible approach to anticompetitive agreements evident in some decisions in the United States and the European Union could have different effects in a smaller jurisdiction.

TINJAUAN YURIDIS TERHADAP PERJANJIAN YANG DILARANGDALAM UNDANG-UNDANG NOMOR 5 TAHUN 1999 TENTANG LARANGAN PRAKTEK MONOPOLI DAN PERSAINGAN USAHA TIDAK SEHAT YANG DILAKUKAN OLEH PELAKU USAHA KERAMBA JARING APUNGDI HARANGGAOLHORISON KABUPATEN SIMALUNGUN

This study aims to analyze the forms of agreement prohibited in Law Number 5 of 1999 concerning the Prohibition of Monopolistic Practices and Unfair Business Competition carried out by floating net cage business actors in Haranggaol Horison, Simalungun Regency. This study uses a juridical empirical and normative juridical approach, through field research and literature research to obtain primary data and secondary data. Literature study is carried out on statutory regulations and other literature and field research is carried out by interviewing business actors of floating net cages in Haranggaol Horison, Simalungun Regency. The data obtained were then analyzed using a quantitative approach and described by analytical descriptive. The results of the study concluded that the forms of agreements that are prohibited under Law 5 of 1999 carried out by business actors in Haranggaol Horison include oligopoly, price fixing agreements, oligopsony, and vertical integration. To prevent the form of a prohibited agreement, it is necessary to establish a cooperative for floating net cage fish business actors to supervise business competition, direct and mitigate the impact of unfair business competition.

Leniency Programs and Cartel Organization of Multiproduct Firms

AbstractWhen multi-product firms make simultaneous price-fixing agreements in different markets, they may compartmentalize these agreements by having different individuals manage them so as to avoid the contagion of antitrust authority investigations. Leniency programs can overcome this strategy but may also lead to procollusive effects for centralized firms. The introduction of US amnesty plus programs can have different competitive effects, and leniency programs may modify firms’ choice of internal structure.

Kartel Angkutan Kontainer Pelabuhan Belawan Tahun 2011 Dan 2012

The rule of evidence in the existence of a price fixing agreement according to Article 5 of Law No. 5 of 1999 on Monopoly and Unfair Business Competition refers more to material evidence without prejudice to written evidence as formal evidence. Therefore, this study aims to analyze: first, what are the evidences that can be used by the Business Competition Supervision Commission (KPPU) in examining alleged cartel violations; and second, what is the rule of evidence which is carried out by KPPU in examining alleged cartel violations. This is a normative research with statutory approach and case studies. The results conclude that the actions of the business actors as reported parties tend to be the actions that are prohibited by law. Meanwhile, the KPPU Decision No. 06/KPPU-I/2013 on the Cartel Case of the Belawan Port Container Transport Tariff in Indonesia, in the process of proving it, applies indirect evidence as a guide to complete the evidence in the Commission Council session. The basis for the consideration of the District Court and Supreme Court is the belief that indirect evidence is not regulated in Indonesian procedural law. However, in its development, in 2011 the Supreme Court began to acknowledge indirect evidence through the Supreme Court Decision on rigging tender case No. 906K/Pdt.Sus/2010.

The Use of Per Se Illegal Approach in Proving the Price-Fixing Agreements in Indonesia

The Indonesia Competition Commission (the ICC) often faces difficulties to find evidence in the form of agreement made by business actors in determining prices. The agreement is the main element to prove the price-fixing which is prohibited under Article 5 of Law No. 5 of 1999 . The legal issue discussed in this research is whether the use of per se illegal approach in proving the price-fixing agreement requires direct evidence or it is sufficient with an indirect evidence. This normative study found that the competition authorities still impose sanctions to business actors even though the (legitimate) agreement does not exist. The examination requires an in-depth understanding of economic theories and should prioritize the principle of prudence due to its vulnerability to manipulation. The analysis of Decision No. 08/KPPU-I/2014 and 04/KPPU-I/2016 found that the ICC proved the price-fixing case using indirect evidence and included an analysis of the impact on competition. Both cases indicate that the ICC applied the rule of reason approach because of the difficulties in finding the evidence of the agreement. On the other hand, the ICC applied per se illegal approach in the Decision No. 10/KPPU-L/2009 and 14/KPPU-I/2014 due to the existence of direct evidence.

Slowdown Antitrust Investigations by Decentralization

When multi-product firms make simultaneous price-fixing agreements in different markets, the introduction of leniency programs may induce firms to compartmentalize their activities. Doing so results in slowdown antitrust investigations and decentralized firm can easily request leniency for a second cartel after the detection of an other. We study how variation of fine reduction may produce procompetitive but also procollusive effects.

COMPARATIVE ANALYSIS OF COMPETITION PROTECTION SYSTEMS IN EUROPEAN UNION AND UNITED STATES OF AMERICA

The origin and basic principles of legislation concerning the restriction, prevention, distortion of competition, as well as the conduct of monopoly companies, and consequently the abuse of dominant position, should be sought in historical legal circumstances. The American and European competition protection systems have a common goal, and both systems seek to protect consumers, the free flow of goods and services on the market, and access to competitors' markets. However, given the different historical and economic-political circumstances, the material and procedural rules that are driving the systems of protection of competition differ significantly in their content, their application and their institutional set-up in general. The basic principles, doctrines, and methods of enforcing US competition law stem from the provisions of three legislative acts that, while broadly and broadly formulated, still contribute to the regulation of actions that restrict competition and illicit market monopolization. Namely, these are the Sherman Act passed in 1890, the Clayton Act and the law regulating the work of the Federal Trade Commission passed in 1914. At first glance, there seems to be a great similarity between Community competition law and that of the United States of America. However, a detailed analysis shows that Article 81 of Treaty of Rome, which prohibits agreements that prevent, restrict and distort competition and, consequently, price-fixing agreements and the first part of the Sherman Act, which prohibits trade restrictive agreements are almost incomparable. The same is true of Article 82, which prohibits abuse of dominant position and Article 2 of Sherman Act, which prohibits monopolization and the attempts to monopolize.The purpose of this paper is primarily to illustrate the differences, similarities of these two systems. The reason for this, lies in trying to determine how and to what extent economic and legal circumstances affect the choice of the system of protection of competition and, consequently, legal provisions and their application.

Price agreement and market provision between principal and distributor in the constitution no. 5, 1999

Market structure is one of the things that determines potential occurance of price fixing. Market characteristics with large entry barriers for newcomers causing difficulties for competitors to enter so that there are no substitutes. Distributor is one of the business actors namely a national trading company that acts for and in its own name based on an agreement with the principal to make purchases, storage, sales and marketing of goods and/or services. There are pricing activities in business activities carried out by distributors with their networks in controlled markets, so the main issue in this study is whether the pricing is included in the price fixing agreement which is prohibited by the Law Prohibition of Monopolistic Practices and Unfair Business Competition. The approach used to analyze the problem is statute and conceptual approach to examine and find legal concepts that are relevant to the issues raised, thus finding a way out and produce solution for business actors to become more competitive and avoid anti-competitive behavior.business competition, price fixing, market share, distributors, principals

How are Price Fixing Agreements Unfair?

The present article advances the understanding of antitrust law by providing some theoretical considerations and empirical results of what people view as unfair regarding price-fixing agreements. Specifically, two theories were tested: the dual entitlement and double effect doctrine. Building on these theories, five hypotheses were formulated. People's attitudes towards price fixing were obtained through experimental surveys on Amazon Mechanical Turk in the United States. The empirical results suggest that people view it as unfair when they feel that businesses rip them off through unequal transactions, such as price fixing and other forms of collusive behavior. But there is more to it than that. People's price-fixing attitudes vary depending on the circumstances, such as when a cost increasing event affects firms' profits and firms price fixed to recoup the loss suffered or when a third-party benefit from the price fixing. Moreover, results suggest that people’s intuitions about price fixing are not static and move whenever the social and moral context changes. The fact that people care about rules of fairness when encountering antitrust scenarios indicates that antitrust law is not built on solid ground, not because economics is not important but because it itself is incomplete. The present research contributes to filling the gap that exists between antitrust law and morality by studying what is wrong about price fixing.

An Ensemble Optimization Framework for Coupled Design of Hydropower Contracts and Real‐Time Reservoir Operating Rules

AbstractRevenues from hydropower generation often depend on the operator's ability to provide firm power in the presence of uncertain inflows. The primary options available for optimizing revenue are negotiation of a firm power contract before operations begin and adjustment of the reservoir release during operations. Contract and release strategy optimization are closely coupled and most appropriately analyzed with stochastic real‐time control methods. Here we use an ensemble‐based approach to stochastic optimization that provides a convenient way to construct nonparametric revenue probability distributions to explore the implications of uncertainty. The firm power contract is a simplified bilateral fixed price agreement that partially insulates operator and buyer from price fluctuations. The release control laws and firm energy target are jointly optimized to maximize the operator's expected revenue. Revenue probability distributions and related spill performance statistics indicate that predictive operating strategies such as stochastic dynamic programming and model predictive control can give significantly better performance than standard deterministic operating rules. The performance obtained from batch optimization with perfect inflow information establishes a convenient upper bound on potential revenue and provides a baseline for assessing the significance of differences between real‐time operating strategies. Sensitivity analysis indicates that the benefits of predictive operational strategies are greatest for reservoirs with medium nondimensional residence times and less important for reservoirs with large residence times. Overall, probabilistic analysis of the coupled hydropower contract‐operations problem provides a realistic way to assess revenue and risk for reservoirs that must provide firm power when inflows are uncertain.

THE MEANINGAND THE FUNCTIONING OF EQUALITY PRINCIPLE INBUSINESS COMPETITION SUPERVISORY COMMISSION DECISIONOFAGREEMENTPRICINGAPPROACH BASED ONMARKET STRUCTURE

The interpretation and the application of the equilibrium principle in competition law raises issues of the philosophy of law, legal theory and legal dogmatic. Based on these issues, then the legal problems, namely: 1) What is the advantages and disadvantages of market structure approach used in the decision of the KPPU to analyze the principle of balance in competition law particularly in price fixing agreement. 2) How is the market structure approach in the KPPU decision, should be developed and used to analyze the principle of balance in competition law particularly in price fixing agreement. 
 To answer the third issue, used the theory: (1) fairness, (2) equity markets, (3) the welfare state in the context of a market economy. This research is based on paradigmatic legal normative hermeneutic approach. 
 The study concluded: 1) The advantages of the approach in the consideration of the legal market structure.KPPU decisions, creating more justice to the parties. The disadvantages of structural analysis approach, namely: the difficulty of proof in writing, setting procedural law clash between the KPPU and the Court of the country, lack of basic legal drafting guidelines that made by the KPPU. 2) In its development, the analysis approach used the Commission's market structure can be used as direct evidence in the form of a letter and stated in Government Regulation and prioritized approach to the analysis of market structure in the KPPU decisions on the prohibition of price fixing.