Collusive networks in market sharing agreements in the presence of an antitrust authority

This paper studies how the presence of an antitrust authority affects market-sharing agreements made by firms in oligopolistic markets. These agreements prevent firms from entering each other´s market. The set of market-sharing agreements defines a collusive network, which is under suspicion by antitrust authorities. This paper shows that, from the firm´s point of view, the probability of being caught is endogenous and depends on the agreements each firm has signed. Stable collusive networks can be decomposed into a set of isolated firms and complete alliances of different sizes. While in the absence of the antitrust authority, a network is stable if its alliances are large enough, when the antitrust authority is considered, the network is stability depends on the network configuration as a whole. Antitrust laws may have a pro-competitive effect as they give Firms in large alliances more incentives to cut their agreements at once

Does Antitrust Need to be Modernized?

In 2002, Congress established the Antitrust Modernization Commission to address whether the antitrust laws needed to be changed in light of globalization and rapid technological change. This paper addresses that question. Although the basic framework of the antitrust laws is suitable to deal with current economic conditions, the paper identifies several areas where antitrust can be improved. The paper first examines whether the proper criterion for antitrust should be total or consumer surplus. Then it identifies some key issues that need to be clarified and explains how they should be clarified. Those issues include market definition, merger policy and the treatment of efficiencies, the interaction of antitrust and intellectual property, exclusionary conduct, the right of indirect purchasers to sue, and the proper allocation of responsibility between regulation and antitrust.

Antitrust and Regulation

Since the passage of the Interstate Commerce Act (1897) and the Sherman Act (1890), regulation and antitrust have operated as competing mechanisms to control competition. Regulation produced cross-subsidies and favors to special interests, but specified prices and rules of mandatory dealing. Antitrust promoted competition without favoring special interests, but couldn't formulate rules for particular industries. The deregulation movement reflected the relative competencies of antitrust and regulation. Antitrust and regulation can also be viewed as complements in which regulation and antitrust assign control of competition to courts and regulatory agencies based on their relative strengths. Antitrust also can act as a constraint on what regulators can do. This paper uses the game-theoretic framework of political bargaining and the historical record of antitrust and regulation to establish and illustrate these points.

Antitrust Private Enforcement – Case of Poland

This article presents the main difficulties surrounding private enforcement of antitrust law in Poland, currently the key implementation problem in the field of antitrust law. Whereas the basic standards concerning the public pillar of antitrust enforcement have already been established, either in the European Community (EC) or in its Member States, the private pillar of antitrust enforcement has not yet been fully developed. The fact that private enforcement of antitrust law is possible, and in fact equal, to public enforcement is not yet commonly recognized. In response to the European Commission’s White Paper on Damages actions for breach of the EC antitrust rules, private enforcement of antirust law is presently under intense discussion in EC Member States. This article should be considered as one of the contributions to this debate. It presents the main legal framework of private enforcement of antitrust law in Poland. In order to do so, it directly refers to the Polish Act on competition and consumer protection, the Civil Code and the Civil Procedure Code. This article also discusses Polish case law in this area. It aims to assess whether existing Polish legal provisions are, in fact, sufficient to ensure effective private enforcement of Polish as well as EC antitrust law. The article refers to the main proposals of the European Commission’s White Paper. It is concluded that private enforcement of antitrust law is indeed possible in Poland on the basis of currently applicable procedural rules, even if there are no special instruments designed to facilitate it. However, it cannot be expect that in the current legal climate, private parties will eagerly and frequently apply for damages in cases of a breach of Polish antitrust law. Antitrust cases are special in many aspects and, thus, they require specific solutions in procedural terms. This article aims to pinpoint those areas, where the Polish law needs to be changed in order to develop and promote private enforcement of antitrust law in Poland.private and public enforcement, private parties, antitrust damages, court proceedings, collective redress, damage actions

Challenges of the New Economy: Issues at the Intersection of Antitrust and Intellectual Property

There is wide agreement that the last decade or so has presented an unusually lively and challenging period for antitrust analysis. Among many reasons we can point to are deregulation and problems of transition to a free market (telecommunications and electricity production offer leading examples), developments in procedural cooperation and possible substantive convergence in response to the increasing globalization of competition and enforcement approaches, and priorities in addressing an unprecedented merger wave. An additional challenge involves the application of established antitrust principles to the growing high-tech sector of the economy. It is that application of antitrust law to the new economy, and particularly the relationship between antitrust and intellectual property, that I will address here

Antitrust and Nonprofit Hospital Mergers: A Return to Basics

Courts reviewing proposed mergers of nonprofit hospitals have too often abandoned the bedrock principles of antitrust law, failing to pay heed to the most elemental hallmarks of socially beneficial competition. This Article suggests that courts’ misapplication of antitrust law in these cases reflects a failure to understand the structural details of the American health care market. After reviewing recent cases in which courts have rejected challenges to proposed mergers between nonprofit hospitals, it documents how courts have engaged in a faulty analysis that ultimately protects nonprofit hospitals from the rigors of standard antitrust scrutiny. It then identifies the core principles of antitrust law—preventing supracompetitive prices, optimizing output, and maximizing allocative efficiency—that have been absent from, if not violated by, the rulings in these merger cases

A Traditional and Textualist Analysis of the Goals of Antitrust: Efficiency, Preventing Theft from Consumers, and Consumer Choice

This Article ascertains the overall purpose of the antitrust statutes in two very different ways. First, it performs a traditional analysis of the legislative history of the antitrust laws by analyzing relevant legislative debates and committee reports. Second, it undertakes a textualist or “plain meaning” analysis of the purpose of the antitrust statutes, using Justice Scalia’s methodology. It does this by analyzing the meaning of key terms as they were used in contemporary dictionaries, legal treatises, common law cases, and the earliest U.S. antitrust cases, and it does this in light of the history of the relevant times. Both approaches demonstrate that the overriding purpose of the antitrust statutes is to prevent firms from stealing from consumers by charging them supracompetitive prices. When firms use their market power to raise prices to supracompetitive levels, purchasers pay more for their goods and services, and these overcharges constitute a taking of purchasers’ property. Economic efficiency was only a secondary concern. In addition, the textualist approach leads to the surprising conclusion that neither the Sherman Act nor the Clayton Act contain an exception for monopolies attained by efficient business conduct. A “plain meaning” analysis of the antitrust statutes reveals that they are supposed to prevent and condemn all privately created monopolies

Antitrust and Intellectual Property: Unresolved Issues at the Heart of the New Economy

The New Economy differs in degree rather than kind from the old economy. Part II of this discussion examines the key differences that define the New Economy. Part Ill turns to several implications of those differences as they pertain to antitrust enforcement. I argue that the differences do not justify sweeping generalizations that antitrust enforcement has no place in the New Economy, but do require antitrust enforcement to make adjustments and exercise sensitivity towards intellectual property issues on a case-by-case basis. The goal of a coherent overall competition policy, in deciding both what conduct to enforce against and what remedies to require, should be to achieve an appropriate balance between the complementary legal regimes of intellectual property and antitrust. Part IV examines several examples of recent antitrust enforcement decisions involving intellectual property. Without addressing the ultimate merits of individual decisions, I find that antitrust enforcement has generally evolved in recent years in a way that pays heed to the distinctive characteristics of the New Economy. These decisions demonstrate a concerted attempt to give reasonable, fact-specific consideration to both incentives and opportunities to innovate. Finally, to supplement the preceding review of substantive issues, Part V examines the institutional challenges posed to antitrust enforcement by the New Economy

Antitrust, Innovation, and Uncertain Property Rights: Some Practical Considerations

The intersection of antitrust and intellectual property circumscribes two century-long debates. The first pertains to questions about how antitrust law and intellectual property law interact, and the second pertains to questions about how parties can exploit property rights, including intellectual property rights, to exclude competitors. This iBrief finesses these questions and turns to practical considerations about how innovation and intellectual property can impinge antitrust enforcement. This iBrief develops two propositions. First, although collaborative research and development has often been and remains unwittingly misunderstood, what is understood about it is consistent with the long- standing observation that antitrust has rarely interfered with collaborative ventures. Second, shifting focus from “intellectual property rights” to “uncertain property rights” makes it easier to understand what innovation and intellectual property imply for enforcement processes. Both intellectual property and tangible assets imply the same processes, but the boundaries of intellectual properties may be uncertain and may, in turn, allow parties to game enforcement processes in ways that would not be feasible in antitrust matters that principally feature tangible assets. Even so, uncertain property rights might not frustrate enforcement processes as the antitrust authorities may yet be able to factor parties’ strategic behaviors into the design of antitrust remedies

Digital Platforms and Antitrust Law

This Article is about “big data” and antitrust law. Big data, for my purposes, refers to digital platforms that enable the discovery and sharing of information by consumers, and the harvesting and analysis of consumer data by the platform. The obvious example of such a platform is Google. The big platforms owe their market dominance not to anticompetitive conduct but to economies of scale. This Article discusses three types of anticompetitive conduct associated with digital platforms: kill zone expropriation, acquisition of nascent rivals, and denial of access to data. There is nothing so unusual about digital platforms that would require a reform of the antitrust laws. Some are described as two-sided markets, but this designation, even after Ohio v. American Express Co., should not present an obstacle to the application of antitrust law. I. Introduction II. Platforms III. Competition Issues ... A. Kill Zone Expropriation ... B. Acquisition of Nascent Rivals ... C. Denial of Access to Data IV. Antitrust Law V. Conclusio