International Antitrust Law & Policy: Fordham Corporate Law 2001

Price: $125.00 667 pages. 1 Hardcover Volume.
ISBN-13: 978-1-57823-100-3 / ISBN-10: 1-57823-100-0

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Book Overview

Foreword

Chapter 1
RECONCILING DIVERGENT ENFORCEMENT POLICIES: WHERE DO WE GO FROM HERE?
by Charles A. James

I. Introduction

II. Globalization and Increased Cooperation

III. When Cooperation Is Not Enough

IV. Implications for the Future

Annex 1

Chapter 2
CONTINUED FOCUS ON REFORM: RECENT DEVELOPMENTS IN EC COMPETITION POLICY
by Dr. Alexander Schaub

I. Introduction

II. The Continued Drive Towards a More Economic Approach

A. Technology Transfer Agreements

B. The Draft De Minimis Notice

III. The Reform of the Rules Implementing Articles 81 and 82

A. The State of Play of the Reform

B. Article 3 and the Level Playing Field

C. The Network and the Allocation of Cases

D. The Network and the Role of the Commission in the New System

E. Article 81(3) as a Directly Applicable Defence and the Role of Block Exemptions in the New System.

F. The Commission’s Powers of Investigation

IV. Enhancing the Fight Against Cartels By Improving the Leniency Programme

V. The Merger Review

VI. Reform in the Field of State Aids

Chapter 3
U.S. AND EC ANTITRUST POLICY

A. Paul Victor, Presider

Luis Pais Antunes

Charles A. James

James F. Rill

Dr. Alexander Schaub

Chapter 4
COMPETITION POLICY, STATE AID AND STATE ENTERPRISES
by Adinda Sinnaeve

I. Introduction

II. The Development of the Concept of State Aid in Relation to State Enterprises - Some Recent Evolutions

III. Convergence and Interaction Between Different Pillars of Competition Policy

IV. State Aid Control in a Global Context

V. Conclusion

Chapter 4a

STATE AIDS CONTROL AND THE DISTORTION OF COMPETITION —UNBUNDLING “DISTORTION”
by Eleanor M. Fox

I. Introduction

I. State Aid Policy—a Perspective

II. “Distortion of Competition”—What Are We Talking About?

III. Conclusion

Chapter 5
IS DECENTRALIZATION OF COMPETITION LAW ENFORCEMENT DANGEROUS? DRAWING LESSONS FROM THE U.S. EXPERIENCE
by Piet Jan Slot

I. Introduction

II. State Antitrust Laws

A. Commerce Clause

B. Supremacy Clause

C. Equal Protection Clause

D. The Due Process Clause

E. The Double Jeopardy Clause

F. Double Recovery

III. Treble Damage Actions and Injunctive Relief for States

IV. State Actions Parens Patriae

V. State Consumer Protection Statutes

VI. Other Provisions Relevant for State Antitrust Enforcement

VII. The 1993 Horizontal Merger Guidelines of the National Association of (State) Attorneys General (NAAG)

VIII. The 1995 Vertical Restraints Guidelines of the National Association of Attorneys General (NAAG)

IX. State Immunity/Action

X. Summary and Conclusion

Chapter 6
EC STATE AID POLICY

Clive Stanbrook, Presider

Eleanor M. Fox

Adinda Sinnaeve

Piet Jan Slot

Chapter 7
MULTI-JURISDICTIONAL MERGER REVIEW
by Dr. Ulf Böge

I. Introduction

II. Difficulties from the Viewpoint of the Firms Affected

III. Multiple Filings in the EU

Chapter 8
EUROPEAN MERGER CONTROL: DO THE CHECKS AND BALANCES NEED TO BE RE-SET?
by Rachel Brandenburger & Thomas Janssens

I. Introduction

II. The Objectives and Principles of the Merger Regulation

A. The Key Objectives

B. The Key Checks and Balances

C. Two Fundamental Principles

III. The Challenges of the Last 11 Years and the Future

A. The Challenges: An Ever Changing Business World

B. The Impact of these Developments on European Merger Review

IV. Which Transactions are Regulated by the Merger Regulation, and Which Should Be?

A. Structural Transactions: The Concept of Concentration

B. Simplifying Merger Control: The Commission’s New Procedure

C. Ancillary Restraints: A Remarkable Change in Policy

V. Which Transactions Are Pan-European, and Which Are Not?

A. Pan-European Transactions: The Concept of Community Dimension

B. Corrective Referral Mechanisms

C. Exception: Protection of Legitimate Interests

VI. Against Which Criteria Should Mergers Be Reviewed?

A. Dominant Position

B. Evolution of Collective Dominance

C. Other New Concepts of Dominance

D. Need for a New Standard?

E. The Need for Certainty

VII. Does the Balance Between Merging Parties and Third Parties Need to be Reset?

A. Background: A Two-Stage Process

B. Reconciling Conflicting Interests

C. An Unbalanced Exercise?

1. Information Gathering

2. The Fixed Timetable

D. Towards a Multiple-Stage Approach?

VIII. Does the Balance Between the Commission and Member States Need to be Reset?

A. Close and Constant Liaison

B. Allocation of Cases: Merger Review 2000.

IX. Is the Merger Regulation Anti-Mergers?

A. Ability to Settle Cases

B. Types of Settlement Commitments

C. Divestment Commitments

D. Behavioural Commitments

E. Need for Creativity

F. Who Should Take the Initiative?

G. Market Testing

H. Timing

X. Is the Judicial Control Adequate?

A. Access to the Courts: The Right to Challenge Merger Decisions

B. Scope of Judicial Control: Marginal Review by the Courts

C. Timing of Procedures Before the Courts: A Barrier to Effective Judicial Protection?

D. Interim Relief: An Adequate Remedy?

E. Is the Judicial Control Sufficient?

XI. Conclusion

Postscript

Chapter 9
UNBUNDLING GE/HONEYWELL: THE ASSESSMENT OF CONGLOMERATE MERGERS UNDER EC COMPETITION LAW
by Gotz Drauz

I. Introduction

II. Types of Leveraging Effects

A. Commercial Tying Based on Pressure on Downstream Agents

B. Commercial Tying Based on Pricing Incentives

C. Technical Tying

III. The Assessment of Conglomerate Effects in the GE/Honeywell Case

A. The Commission’s Case in a Nutshell.

B. GE’s Toolkit for Market Dominance

C. GE Capital was a Factor

D. GECAS was a Factor

E. Interim Conclusion on GE’s Ability to Become Dominant

F. The Effects on Honeywell, at the Core of the Commission Decision

G. Related Elements

1. Exit of competitors

2. Antitrust protects competition, not competitors

3. A false efficiency debate

4. Was product bundling an efficiency or an exclusionary practice?

5. Is ex-ante control the only way to deal with leveraging of market power?

IV. Conclusion

Chapter 10
INTERNATIONAL MERGERS: THE VIEW FROM A NATIONAL AUTHORITY
by John Vickers

I. Introduction

II. Viewpoint

III. The Present System in the UK

IV. UK Merger Reform

V. UK Procedures

VI. The UK and the European Commission

VII How Many Mergers are International?

VIII. Practical Examples

IX. ECMR Reform

X. Conclusion

Chapter 11
MERGERS AND ACQUISITIONS

Reman P. Harry, Presider

Rachel Brandenburger

Gotz Drauz

Richard Gilbert

William E. Kovacic

John Vickers

Chapter 12
OLIGOPOLIES AND JOINT DOMINANCE IN COMMUNITY ANTITRUST LAW
by John Temple Lang

I. Summary

II. Introduction

III. The Main Judgments of the Community Courts

A. British-American Tobacco and Reynolds Industries (“the Philip Morris case”) (1987)

B. SIV v. Commission (Italian Flat Glass) (1992)

C. Almelo(1994)

D. France v. Commission— Kali und Salz (“Soda Ash”) (1998)

E. The Gencor judgment (1999)

F. Irish Sugar (1999)

G. Compagnie Maritime Beige (2000)

IV. The Main Decisions of the Commission

A. Nestle/Perrier (1992)

B. Pilkington Techint/SIV (1994)

C. ABB/Daimler Benz

D. Pricewaterhouse/Coopers and Lybrand

E. Enso/Stora(1999)

F. Danish Crown/Vestjyske Slagterier(1999)

G. Exxon/Mobil (1999)

H. Alcan/Pechiney(2000)

I. Airtours/First Choice(2000)

]. Pirelli/BICC(2000)

K. EMI/Time Warner(2000)

L. Outokumpu Steel/Avesta Sheffield(2000)

M. VEBA/VIAG (2000)

V. Other Commission Decisions on Joint Dominance Under the Merger Regulation

VI. Article 82 Cases: Abuse of Joint Dominant Positions

VII. The First Uncertainty: “Economic Links” Between Oligopolists

VIII. Four Views on Oligolopolistic Pricing

IX.. The Test of Whether Collusion Could Be Monitored as Evidence that Price Competition Will Be Ineffective

X. Past Conduct as Evidence of Joint Dominance

XL The Presence of Uncompetitive Features in a Competitive Market

XII. “Substantially Lessening Competition?”

XIII. The Significance of Capacity in Joint Dominance Cases

XIV. Absence of Competition Is Not Proof of Collusion

XV. Is Joint Dominance the Same Under Article 82 and the Merger Regulation?

XVI. So What Is the Best Way to Understand the Law?

XVII. Effective Competition

XVIII. “Vertical Joint Dominance”

XIX. Features Leading to Joint Dominance

XX. Price Levels and Profits

XXI. Facilitating Practices

XXII. Shareholding Links Contributing to Joint Dominance

XXIII. Contractual Links Contributing to Joint Dominance

XXIV. State Measures Contributing to Joint Dominance

XXV. The European Market, or a Series of National Markets?

XXVI. Patent Pools, Standards and Joint Dominance

XXVII. A Series of Anticompetitive Actions By Oligopolists

XXVIII. The Likelihood of Future “Abuses”

XXIX. Factors Inconsistent with Joint Dominance

XXX. The Less Empirical Approach in Europe

XXXI. The Consequences of Joint Dominance - Article 82

XXXII. The Consequences of Joint Dominance: Merger Regulation Cases

XXXIII. The Consequences of Joint Dominance: Article 81

XXXIV. Defences in Joint Dominance Cases, Including Efficiency Defences

XXXV. Remedies in Joint Dominance Cases

A. Article 82 Cases

B. Remedies in Joint Dominance Cases: The Merger Regulation

C. Remedies: Oligopoly Cases Under Article 81

D. Remedies: Non-Discriminatory Access

XXXVI. Some Procedural Issues in Oligopoly Cases

XXXVII. The New Expedited Procedure for Merger Regulation Cases

XXXVIII. Oligopolies and Joint Dominance Cases Before National Antitrust Authorities

XXXIX. Conclusions: The Need for a Clearer Policy

Chapter 13
COLLECTIVE DOMINANCE AND THE EC MERGER REGULATION
by Frédéric Jenny

I. Dominance and Collective Dominance

II. A Look at the Economic Concept of Oligopoly

III. The Challenge of Combining the Legal Approach to Collective Dominance and the Economic Approach to Oligopoly

IV. Different Possible Concepts of “Collective Dominant Position”

V. Merger Control and the Question of Causality

VI. Past Behavior and Performance in the Industry

VII. A Modest Proposal

Chapter 14
COLLECTIVE DOMINANCE/OLIGOPOLY BEHAVIOR UNDER ARTICLES 81/82 AND THE EC MERGER REGULATION

Hans-Jörg Niemeyer, Presider

Götz Drauz

Frédéric Jenny

John Temple Lang

Chapter 15
ENERGY LIBERALISATION AND EC COMPETITION LAW
by Michael Albers

I. The Role of EC Antitrust Law

II. Free Consumer Choice of Suppliers

A. Gradual and Uneven Market Opening

B. Locking-in of customers.

III. Free Supply Competition

A. Electricity

B. Gas.

IV. Open Access to Networks

A. Development of Transmission Tariffs

B. Dealing with Congestion

C. Cooperation with National Regulators

V. Public Service Obligations and Competitive Energy Markets

VI. Conclusion

ANNEX

Chapter 16
EMERGING ANTITRUST ISSUES IN THE TRANSITION TO DEREGULATED ELECTRICITY MARKETS
by Mike Naeve & Jerry L. Pfeffer

I. Introduction

II. Overview of Industry Structure Prior to Deregulation

III. Regulation of Electric Utilities Prior to Restructuring

A. Overview

B. FERC Regulation of Wholesale Markets

C. State Regulation of Retail Markets

IV. Application of the Antitrust Laws to Electric Utilities

A. Department of Justice/Federal Trade Commission

1. Statutory Framework

2. Merger Guidelines

B. FERC

1. Consideration of Antitrust Issues Under the FPA

2. Different Standards for Review of Market Power Issues

a. Market Power Issues Under Section 203

(1) Horizontal Market Power

(2) Vertical Market Power

b. Market Power Issues Under Section 205

C. Securities and Exchange Commission

D. Nuclear Regulatory Commission

E. State Regulation

V. Key Developments in the Transition to Competitive Wholesale Markets

A. Technology Change and New Market Entry

B. The 1992 Energy Policy Act

C. Order 636

D. Orders 888 and 889

E. New Wholesale Market Structures

F. Order 2000

G. State Restructuring Programs

H. California Market Failure

IV. Current Antitrust Issues Resulting from Industry Restructuring

A. Antitrust Enforcement in Transitional Markets

B. Tension Between DOJ/FTC and FERC in the Review of Mergers and

C. Structural Versus Behavioral Remedies

D. Analytic Tools for Assessing Market Power

E. Identifying Transactions Requiring More Detailed Analysis of Competitive Issues

F. “Acceptable” Levels of Price Increases in Evaluating Proposed

G. Market Monitoring Mechanisms as a Deterrent to Anticompetitive

H. “Market Failure” versus “Market Power;” Antitrust Enforcement in Dysfunctional Market

I. Joint Ventures and Coordination Arrangements

1. Joint Purchasing Arrangements

2. Joint Project Development Ventures

3. RTOs and Reliability Groups

J. Public Disclosure of Production Cost and Market Pricing Data

K. Bundling and Tying Arrangements

L. Leveraging Monopoly Power Between Market Segments

M. State Action Immunity

N. Control Derived Through Contracts and Financial Instruments.

O. The “Number” of Market Participants as a Measure of Competition

VII. Summary

Chapter 17
EXCESSIVE PRICING UNDER EC COMPETITION LAW; AN UPDATE IN THE LIGHT OF “DUTCH DEVELPOMENTS”
by Erik Pijnacker Hordijk

I. Introduction

II. The Basic Concepts of U.S. and EC Antitrust Laws with Regard to Economic Dominance; a Brief Summary

III. Excessive Prices as Abuse of a Dominant Position Under EC Competition Law

A. General Observations

B. Chiquita: The Cost Price Analysis

C. SACEM and Bodson: The Comparative Market Analysis

D. Cases in the Air Transport Sector

E. Cases in the Telecommunications Sector

IV. Appraisal of Case Law and Administrative Practice; No Case for Price Regulation on the Basis of Article 82 EC

V. Once Again the U.S. Approach

VI. Decisions and Formal Positions Adopted By the NMa

A. Introduction

B. Postoffice Box Tariffs of PTT Post

C. KPN vs. Denda

D. Tariffs Applied by KLM on Routes to the Dutch Antilles and Surinam

E. Schiphol

F. Tariff Regulation for the Gas Sector

VII. Appraisal of the Steps Taken By NMa

A. General

B. Cost-orientation

C. Valuation of Assets

D. Review of “Excessive Costs”

E. The Fixing of a Normative Rate of Return.

F. Other Issues

VIII. Final Conclusion

Chapter 18
MARKET POWER IN ELECTRICITY MARKETS: REGULATION, DEREGULATION AND COMPETITION - LESSONS FROM THE ITALIAN EXPERIENCE AND OTHER EUROPEAN AND U.S. CASE STUDIES
by Giuseppe Tesauro

I. Introduction

II. The Italian Electricity Industry

A. Description of the Italian reform

B. A Comparison with the British and French Experiences

II. The Four Electricity Markets Which Comprise the Electricity Industry: The Italian Scenario

III. The Electricity Markets and Market Power

A. Market Power Indicators: The Limit of Market Share Analysis and the Necessity to Estimate the Capacity to Fix the Marginal Price

B. The Evolution of the Market Power Definition in a Multiutility and Multinational Electricity Industry

IV. Regulation and Deregulation in the Electricity Industry: The Most Important Things to Learn from the Recent Experience in California

V. Conclusions

Chapter 19
ENERGY LIBERALIZATION/DEREGULATION

William T. Lifland, Presider

Michael Albers

Erik Pijnacker Hordijk

Clifford M. Naeve

Giuseppe Tesauro

Chapter 20
THE POLITICAL ECONOMY OF ANTITRUST IN BRAZIL: FROM PRICE CONTROL TO COMPETITION POLICY
by Claudio Monteiro Considera
Paulo Corrêa

I. Introduction

II. The Historical Background

A. The Post-World War II Industrialisation Period - 1945-1964

1. Politics and Economics

2. Competition and Antitrust

B. The Military Governments - 1964-1984

1. Politics and Economics during the “Miracle” - 1964-74

2. Competition and Antitrust during the “Miracle” - 1964-74

a. Price Control as a Cartel Organiser

b. The New Role of Producer Associations

C. “Stop and Go” and Recession - 1975-84

1. Politics and Economics during the “Stop and Go” and Recession

2. Competition and Antitrust during the “Stop and Go” and Recession

D. The New-Democratic Regime - Years of Uncertainty: 1984-94

1. Politics and Economics

2. Competition and Antitrust

E. Democracy and Economic Reforms - 1994-2001

1. Politics and Economics

2. Competition and Antitrust

III. The Present State of Arts and the Future

IV. Political Economy Aspects of Competition Law and Policy in Brazil

A. What are the Objectives of Antitrust Law and Policy in Brazil?

1. Main provisions of the act

2. Enforcement.

3. Comments

B. What Should be the Objectives of Antitrust Law and Policy in Brazil?.

Chapter 21
POLITICAL ECONOMY INSIGHTS FROM COMPETITION POLICY IN IRELAND
by Dr. John Fingleton

I. Introduction

II. Irish Competition Policy Pre-1991

A. Pre 1991 Legislation

B. Economic Policy

III. 1991 Competition Act

A. Article 81 and 82 Analogues

B. The Competition Authority

C. Mergers

D. Constitutional Background

IV. Rationale Underlying 1991 Act

A. Arguments Favouring a Strong Law

B. Arguments Against

C. Result

V. Developments Following the 1991 Act

A. The Positive Side

B. Problems

C. Calls for Reform

VI. Public Enforcement and Criminalisation: 1996

A. 1996 Competition Amendment Act

B. Rationale

C. Outcome

D. Proposals for New Competition Law: 2001

VIII. Political Economy Insights

A. Merger Policy is Different

B. Convergence Does Not Require Identical Laws

C. Private Litigation

D. Templates for Designing New Law

E. Self-Equilibrating Mechanism

F. Role of Economics Underlying the Policy Debate

G. State Restrictions

H. EU Influence

I. Coalitions of Support

VIII. Conclusion

Chapter 22
THE KALEIDOSCOPE OF ANTITRUST AND ITS SIGNIFICANCE IN THE WORLD ECONOMY: RESPECTING DIFFERENCES
by Eleanor M. Fox

I. Introduction

II. Commonalities and Differences

III. The Pervasive Influence of Political Economy Perspectives

IV. Antitrust Diversity and the Single (World) Market

Chapter 23
REALITY BITES (OR BITS): THE POLITICAL ECONOMY OF ANTITRUST ENFORCEMENT
by Dr. Michal S. Gal

I. Introduction

II. Politics Cannot Be Simply Ignored

A. How Does Politics Affect Antitrust?

B. Reality Bits of the Political Economy of Antitrust

1. Political Influences that Help Fuel the Antitrust System

2. Political Considerations that Determine the Final Outcome

C. Political Influences that Motivate the Creation of Laws that Bypass Antitrust

III. Combating Poltical Influences Through Institutional Design and Social Planning

A. Autonomous Agency

B. Non-political Nomination of the Director

C. Independent Budget

D. Juridical Scrutiny

E. Legal Limitations on Discretion

F. Joining Forces with other Governmental Bodies

G. Transparency of Decisions

H. Empowerment of Consumer Groups

I. Positive Public Opinion

J. Criminalization of Antitrust Proceedings

IV. If You Can’t Beat Them - Join Them?

V. Conclusion

Chapter 24
THE POLITICAL ECONOMY OF ANTITRUST
by David Lewis

Chapter 25
COMPETITION LAW AND POLICY - THE ROLE OF POLITICAL INFLUENCE
by Ilya Yuzhanov

I. Should Antitrust Policy Be Based on Pure Economic Principles or Should It Also Take into Account Political Goals?

A. Adoption

B. Enforcement

C. Modernization of Legislation

II. The Status and Competence of Antitrust - An Important Factor in Political Considerations

III. Self-Development of Antitrust Authorities - Are There Effective Correctors?

IV. Efficiency Grounds Via National Political Economy Grounds

Chapter 26
POLITICAL ECONOMY OF ANTITRUST ROUNDTABLE

Frédéric Jenny, Presider

Claudio Monteiro Considera

John Fingleton

Eleanor Fox

Michal S. Gal

David Lewis

Nataliya Yacheistova

Book Overview