Archive for the ‘Events’ Category
I landed in Brussels this morning at 7 am after an intense week of
cocktails antitrust events at the ABA’s antitrust spring meeting in DC. I’m knackered (I also have to recover from the sight of 2,700 antitrust lawyers under the same roof) and have lots of catching up to do, so let’s keep it simple today:
Nicolas’ Friday post criticized several pricing practices in the conference market, namely excessive pricing and lack of pricing discrimination in favor of academics and students.
This is not a new topic; some of you might remember that many posts ago I proposed an algorithm for competition conferences, positing that “the likelihood of getting to listen to new and interesting stuff is inversely proportional to the combination of three cumulative variables: the price of the event, the number of attendees, and the number and lenght of slide decks. It’s generally not a good sign if an event is pricy and crowded. The ones with a greater chance of not being interesting at all are those for which you have to pay in order to be a sp
ayeaker (yes, there are plenty of those!)”.
I discussed Nico’s post with a few sensible people over the w-e, and the discussion quickly came down to one sole issue: the ‘funny’ (not as in haha, but as in questionable) but prevalent practice of paying for speaking slots, which I had only touched upon in passing in my previous post.
I would argue that paying to speak is essentially a marketing trick based on misleading the audience. Let me prove my point: how many spaykers do you think would want to appear at a conference if the audience had transparent information about who’s paying for the slot and who’s not?
If you’ve something interesting to say, you should get paid for it (not so difficult, even Sarah Palin gets paid to speak) or at least be invited to speak for free. Note also that people who pay to speak would not normally (there are of course exceptions) give objective overviews of the topic at issue; their presentation would tend to be a more or less obvious sales pitch. I’ve nothing against lawyers advertising themselves, but, as in other contexts (some might think of search engines), it’s generally good to be able to tell what’s advertising and what’s not.
The most obvious way to address this “market failure” and push for a merit-based allocation of speaking slots would be to have lawyers stop paying (smart, uh?), but since self-regulation is unlikely to work, I would suggest, for a start, that public officials refuse to appear in conferences where people pay just to sit with them.
What’s your take?
As explained in previous posts, there is a new and innovative Spanish competition law in the pipeline. I say innovative because the main change it will bring to the current system is the unification of sectoral regulators and the competition enforcer into a single “competition and markets authority”. We have voiced out some of our views about the draft law in a previous post. I’m still hesitating over the idea of writing a well thought out post explaining what’s going on in Spanish competition law (I do very little national work these days, but still follow it closely), but it might be wise to go through a cooling off period first.. Anyway, what I meant to say -mainly to our Spanish readers- is that the new draft law was approved by Congress and sent to the Senate earlier today. It’s available here.
Also, I’ll be flying to DC on Tuesday for the ABA’s section of antitrust law spring meeting. The program is interesting, but this event is mostly about
attending free cocktails networking (which may reinforce the perception some people have of lawyers as heavy drinkers). If any of the readers of Chillin’Competition is around, you can drop me a line (firstname.lastname@example.org); unfortunately we don’t always get to meet those of you outside Brussels. My firm will not be hosting a reception [hosting cocktails in the State can be risky from a legal point of view ;)], so I’m collecting cocktail invitations from others. I actually have a bet with an in-house counsel friend to see who gets more, and he’s clearly way ahead. Being an in-house at one of these events must feel like being the hot girl at a night club: everybody wants to buy you drinks…
As you know, we like to use this blog to favor our own related services So here’s some advertising on three upcoming seminars to be held in Madrid within the framework of the Competition Law Course that Luis Ortiz Blanco and I co-direct, now on its XVI edition. (The pic above was taken during a lecture I gave there last Wednesday on antitrust in non-regulated network industries).
28 February- 1 March: Seminar on Competition Law in the Public Sector (coordinated by José Luis Buendía -Garrigues- and Jorge Piernas -EUI-), also featuring Joaquín Fernández (DG Comp), Luca Rubini (Univ. Birmingham), Jerónimo Maillo (CEU), Carlos Urraca (Legal Service, European Commission), Deborah Heredia (Spanish Ministry of Foreign Affairs), Juan Arpio (Univ. Zaragoza), Alejandro Requejo (Compass Lexecon), Juan Pedro Marín (SEPI), Rafael Calvo (Garrigues) and Juan Espinosa (Spanish Competition Authority). Program available here: Competition law in the public sector 2013
8 March: Seminar on Recent Developments in Merger Control and Art. 102, featuring Cecilio Madero (Deputy Director General, DG Comp), Per Hellström (Head of Unit, DG Comp), Nick Banasevic (Head of Unit, DG Comp), and Milan Kristof (Référendaire, CJEU). Program available here: Recent developments in EU merger control and Art. 102 TFEU
15 March: Seminar on IP and Antitrust (coordinated by Alvaro Ramos), featuring Claudia Tapia (IP Director, Blackberry), Gil Ohana (Senior Director, Cisco Systems), Gunnar Wolf (DG Comp), Ief Daems (EU Counsel, Samsung), María Álvarez (Advisor, Spanish Competition Authority) and Victoriano Darias (Managing Director, The Napkin Idea). Program available here: Seminar IP and Antitrust 2013
Just in case you haven’t yet registered….
Lunch Talk Series – Searh Engines and Competition Law- Friday 8 February 2013
12:00 – 12:30: Sandwich lunch and socializing
12:30 – 13:45: Presentations and comments
- Mr Cédric ARGENTON, TILEC – Tilburg University
- Mr Alfonso LAMADRID, Garrigues
- Ms Anne PERROT, MAPP
13:45 – 14:00: Q&A
Please register online at: http://63rdgclclunchtalk.eventbrite.com
Registration is open until 6 February 2013.
Standard rate: 35 EUR (VAT incl.) – free seats available for sponsors.
Global Competition Law Centre
College of Europe, Bruges
As Pablo noted yesterday, my blogging urgers trump doctor’s recommendations; I figured that if Cervantes could write Don Quijote with one hand I could at least try typing a couple of posts on competition law single handedly..
We’ve undertaken a search for the most relevant competition law events to be held in February, and decided to advertise the results here. Coincidentally (or not) the events shown below are related either to friends or to us. We are aware that promoting one’s own stuff has for some become a risky business, but oh well…
On 1 February 2013 we will be holding a seminar on recent developments in relation to Article 101 within the framework of the IEB course in Madrid. Eric Gippini Fournier and Fernando Castillo de la Torre have come up with a great line-up of speakers: Viktor Bottka (Legal Service); Pablo Ibañez Colomo (LSE) and Luis Ortiz Blanco (Garrigues) will be dealing with object/effect issues; Cani Fernández (Cuatrecasas), Marisa Tierno Centella (DG Comp until recently, now CNC) and Fernando Castillo will speak about sanctions (fines, leniency and private enforcement); Lorena Boix (DG Connect), Helena Larsson Haug (DG Comp) and Ainhoa Veiga (Araoz&Rueda) will focus on online distribution and distribution of digital works. For further info you can drop me a line (email@example.com)
On Friday 8 February at 12.00 h. there will be a Global Competition Law Centre lunch talk in Brussels on “
On a larger scale, on 22 February 2013 our friends at Concurrences will be holding the New Frontiers of Antitrust 2013 conference at the Assamblée nationale in Paris. This conference has earned its place among the top competition law events of the year. Even though it’s not cheap, it’s always packed, so that should tell you something about the quality of the sessions. For info and registration see here. As you will see in the program, the interface between data protection and competition law will be one of the main topics dealt with; we’ll provide you with some personal views on this
We move on with a last panel on the relationship between EU and National enforcement in relation to sanctions.
Christophe Lemaire (Paris I and Ashurst) gave a comprehensive presentation on the process of convergence in terms of sanctions and, more generally, on procedural and institutional settings in the EU. And the list is impressive, as Member States seem to informally or through the ECN be working on how to streamline their approaches to sanctions. A working group related to sanctions was apparently created a short while ago in the ECN, but the timeline for the deliverables remains uncertain.
Eddy de Smijter (DG COMP, EU Commission) talks of the interplay between public and private enforcement. Eddy made the funny remark that it is currently “sales period” at the Commission, with rebates for leniency, for settlements, etc. Some want additional presents, such as reductions for compliance programmes and for voluntary compensation. But a key concern is that this is likely to reduce the gap between the n°1 and n°2 leniency applicants, and this is no option for the Commission. Moreover, if the Commission is ever to extend such rebates, this is likely to further decrease fines for everyone, on grounds of non discrimination. Then Eddy mentions in passing the theoretical debate, that exists in the US, that compensation could be a condition for leniency. He then moves to the question of what can be adjusted in leniency programmes to promote compensation. The idea of a “civil mirror” looks attractive to would be applicants: you get immunity at the administrative stage, you get it in the context of civil litigation for damages; you get fines reductions at the administrative stage, you get similar reductions in terms of damages at a later stage. Or another option is to state in the law that leniency applicants are to be the last resort defendants in claims for damages. A third option is that if you go after the immunity recipient in civil damages, then the immunity applicant should not be jointly and severably liable for the damages with the other cartel participants.
Eric Morgan de Rivery covers the Menarini case. His presentation speaks for itself. There should be, after Menarini and KME-Chalkor, full review. But he doubts the EU Courts are willing to move beyond words on this, and he argues that if the Court state that full review is actually discharged, a close examination of the facts reveals that it is not.
A nice lunch, and we are back on track.
We start with Cédric Argenton‘s (TILEC) presentation. Cédric seeks to identify a system of penalties that achieves optimal deterrence considering that firms are akin to black boxes, in other words that the management board has little control over what managers actually do. But they can design compensation schemes that seek to incentivize managers ex ante. With this background, Argenton and Van Damme build an economic model that tries to assess how individual managers will behave, considering that they know that the management board has imperfect information over what they actually do. They explain that manager have three options: do nothing, achieve high profits by cutting costs, achieve high profits with collusion. The conclusions they reach in their paper are that individual sanctions are a very good way to increase the optimality of the current sanctioning mix. They are actually a “help” to firms that attempt to comply with the law. But individual sanctions should not come alone. They should also be accompanied by corporate sanctions. Cédric and Eric’s economic model is currently undergoing experimental testing at Tilburg university. Looking forward to read their empirical results.
The following speaker is Stefan Thomas (Tubingen University). His speech is essentially about the “single economic entity” doctrine. According to Stefan, this doctrine is in plain contradiction with the principle of personal liability, as protected by several constitutional rules and international instruments. The German supreme court actually recognized this. Moreover, this doctrine is also injurious of another fundamental principle, i.e. “nulla poena sine culpa“. Stefan also takes a shot at the inconsistency of not entitling the companies to rebutt the parental liability presumption, simply by showing that they have not known or that they have not participated to the infringement. Stefan says that the Commission should assess if the parent firm has done everything possible to avoid infringement. If this is the case, this should exculpate it from liability, or mitigate it, under the competition rules.
The third speaker is Anny Tubbs (Unilever). To her, no one is perfect and a fortiori, no company is perfect. Agencies should recognize this rather than using sabre-rattling words to talk of competition infringements. Anny then goes on to explain what she views as necessary components of an effective compliance programme. In this context, I advise the reading of the slides, where there is a nice one on the 5 Cs of a good compliance programme. She also explains the internal hurddles within companies to establish competition compliance programmes. Competition law is not the sole area of law where compliance matters. Money laudering, corruption, personal data, etc. are all areas where compliance is critical. In house lawyers from the same company, but representing distinct disciplines thus often compete to convince management to allocate compliance resources towards them. Anny also indicates that lawyers are often their worst ennemies when it comes to compliance, because when they talk to salesmen, they use words that are so complex that no one ever wants to listen to them. This makes it important for in house lawyers involved in compliance to develop clear and simple messages at the attention of businesses.
A recurring issue in the presentations was the parental liability doctrine.
Very fortunately, a Commission official who was sitting in the room accepted to make some remarks (in personal capacity).He first vindicated that compliance programmes are, at any rate, a good thing, and that there is no need for additional discounts because those programmes (i) diminish the risk of infringement in the first place; and (ii) decrease the duration of infringements with efficient self reporting mechanisms.
He also gave some thoughts on parental liability, being supportive of AG Kokott’s opinion in the Gosselin case. To him, parental liability is not a problem, because the mother company, even if it is very remote from the subsidiary, derives some profit from the cartel at any rate. In reaction to this, S. Thomas counter-argued that we had spent decades to build fundamental principles such as “nulla poena sine culpa“. Those are great progresses of the rule of law. They should not been thrown away, simply for the sake of designing an optimal sanctioning programme.
This led me to a puzzling analogy: to me the Gosselin’s Kokott doctrine is akin to sanctioning with criminal fines the heirs of criminals, simply because they have given birth to a delinquant, and that they may have profited from it through presents and other gifts. Unless those persons are actual accomplices (they have instructed or assisted to illicit activities), there should be no ground to blame them.
Judge Ginsburg ( United States Court of Appeals for the District of Columbia Circuit) opens this session. In his view, the main flaw of current deterrence policy is to only seek to make cartels unprofitable for companies. But as long that it is not unprofitable for individuals to craft cartels, there will be cartels. What must be understood is that individuals profit from price fixing in ways different from corporations. The fact that individuals are compensated for divisional profits, regardless of firm’s performance when faced with cartel proceedings is for instance one of the things that keeps cartels creeping the economy. Moreover, there are many ways sanctions on individuals are mitigated by firms, thereby nullifying their potential deterrence (compensation schemes, etc.). Judge Ginsburg mentions for instance that some Korean firms re-hired businessmen involved in cartels, after jailtime in the US, and had taken care of family, etc.
His bottom line is that to do nothing against individuals involved in cartels makes no sense. Individual fines (monetary) are not a necessarily a good deterrent because they find a limitation in individual’s wealth. Jail sentences are probably the most deterrent penalty. Debarment is possibly a good thing, but it has no teeth against persons at the end of their career. It can also be wasteful to take away this human capital from society (but the same is true with jail). The focus of attention should thus be, in his view (i) on individuals (in particular on compensation scheme); and (ii) on what is the most efficient mix of sanctions. Finally, judge Ginsburg draws an analogy between firms and a whipping boy. Leave it to you to understand the parallel.
Andreas Stephan (East Anglia) opens with a note of disagreement with Judge Ginsburg, but promises to come back to this. He moves on explaining that the current “fines-only” approach of agencies is not the right one. Fines are not deterrent, plain and simple. And the debate on how to improve fines is dead in the water, given it is proven that optimal fining would lead most firms to bankrupcy.
Andreas’ second concern has to do with the protracted nature of antitrust investigation. All too often, this gives rise to the odd situation where the victims of corporate fines are the current shareholders, employees and consumers (through fines being passed on) of a company, whilst employees responsible of cartels are often no longer in business, and immune from any penalty. Andreas also makes an interesting point on economic studies that show that share valuation decreases when investigation are announced, but increase when investigation are closed with an infringement decision. According to him, this means that capital markets worry more about uncertainty than about sanction.
Andreas also points out that most supporters of criminal sanctions cite the US as an example of an efficient system. But what people ignore is that most such cases in the US are settled and not brought to an end. In fact, if the US have been so successful at running criminal antitrust cases, it is because they have a system of plea bargaining. We dont have any such thing in the EU, and if we had, it may not pass the bar before the ECHR.
Finally, Andreas mentions Director Disqualification Orders, which although in existence in UK law have never been enforced. And one of the problems with the UK regime, is that it only applies to Directors, and to Directors registered in the UK. Now, with the EU internal market, this can be easily circumvented, with UK firms appointing Directors in Belgium or elsewhere. Andreas concludes on the Commission’s reluctance to even initiate discussion on individual criminal sanctions. But this evolution is already taking place in the MS. In his view, the Commission should use the ECN to start this dialogue.
Tom Barnett‘s (Covington and Burling) speech’s is about differences between US and EU antitrust enforcement. He explains generally that what agencies try to do is to bring change in business culture. He talks about the growing awareness that cartel participation is risky. The main difference with the US, however, is that this evolution has taken place earlier there. In the EU, the evolution of business culture has been way slower. In the remaining of his speech, Tom focuses on more specific points. On compliance programmes, he recalls the audience that enforcers face the problem of separating wheat from chaff, i.e. what is a genuine compliance effort from a sham compliance policy. That said, Tom finds a genuine merit in compliance programmes (even sham ones it seems), which is to help educating business to antitrust risk. Rewarding them with some discounts on fines many thus not necessarily be a bad idea. His other important point is that the timing sanctions are imposed is important. Sanctions are adopted more quickly in the US than in the EU. In his view, it is important to speed up the fining process. First because, the closer to the facts the penalty, the more certain its deterrent effect. Second, because corporations need to move on and return to business quickly.
The final speaking slot goes to our good friend Luis Ortiz Blanco. Luis draws an analogy between antitrust fines and Rubens’ massacre of the innocent. This point, which ties in with Andreas’ Stephan presentation, is that the current fining policy harms many innocents, i.e. current employees and shareholders, whilst leaving managers unscathed. In turn, his presentation explores alternative ways to deter competition infringements. Luis makes a good point on The ECtHR in Menarini. The EU judicial review system may well pass the Menarini standard. But should we aim for a bare pass, or should we aim for the best possible, Nobel prize winning, system of judicial review. This point will be further elaborated in a forthcoming paper with Mark English. Luis then goes on to elaborate on a possible asymetrical administrative procedure in competition cases, with several types of proceedings available in distinct types of cases. His presentation, which was both hilarious and creative, is available below.
As a kid, I had a dream. That of becoming a professional journalist. And I must say that this blog has, at least to some extent, entitled me to achieve it.
Today, the TILEC-LCII conference on fines offers me an additional opportunity to
beat M-Lex do this. I’ll try to offer live coverage of the discussion, as we go through the day. For each session, the speakers’ ppt. presentations will be available at the end of the post. A disclaimer: please bear with the rough, instant reporting style of my posts.
So here we go. We start with Damien Geradin‘s introductory speech. A take away point: the usual argument against new sanctioning tools, is that it is not feasible under current EU competition law standards. Now Damien is very right to mention that competition law underwent many significant reforms in the past decade, including vertical restraints, decentralisation and the effects based approach in Article 102 TFEU.
We then have the presentation of André Uhlman, from ThyssenKrupp AG. André points out the difficult conundrum between the non recognition of in-house legal priviledge, and the increased role of self assessments in EU competition law. This leads companies to avoid documenting internal advice, for fear of subsequent disclosure, and involve external counsels in all aspects of business life. A second area where companies walk on thin ice is sanctions against employees. On the one hand, shareholders, the executive board and the public opinion may promote a zero tolerance policy, yet on the other hand, this will undermine employees incentives to cooperate in the context of investigations, or to report information useful in the context of leniency applications, for fear of being subsequently sanctioned. A third point is that compliance is expensive, in particular in times of crisis. So if NCA were to reward compliance efforts – like the OFT or the French NCA do – this could help convince to set up such programmes. Finally, André mentions a case that we should have covered on this blog, i.e. C-199/11, or the Commission’s private enforcement test case, where the Court held that the Charter did not prevent the Commission to act as a damages claimant and enforcer in one and a same case. Frankly, to me, the value of this case seems fairly limited, given the few instances in which the Commission (or a NCA) will be victim and enforcer at the same time, unless NCAs or the Commission are ever empowered to act on behalf of claimants in follow on litigation.
Prof J. Harrington‘s talk (Wharton) walks us through the economics of anticartel enforcement. He starts with the dynamic incentive approach of deterrence. I like the idea that when cartels grow and endure, some documentary evidence is lost and this should be accounted in the deterrence equation. According to Prof Harrrington, the penalty inflicted should increase as time passes, to reflect for the lost evidence. Now, Prof. Harrington explains that in fact, fines that make cartels unprofitable (the current approach) may be higher than what is needed to make cartels unstable (the dynamic approach I just mentioned). And he seems to propose to muscle up the second approach. That said, to me, the first approach remain a necessary policy. Making cartels unstable is not enough because it does not eliminate the harm that existing cartels cause until they are destabilized.
Prof Harrington turns to the thought provoking question: “how can we be concerned with overdeterrence if all collusion is bad?“. Well, he goes on to explaining that competitive conduct can be wrongly accused of hardcore collusion because of flaws in the discovery and prosecution process. He takes, for instance, the example of the erroneous prosecution of R&D JVs, trade associations, etc. This concern may, however, be close to moot in the US, given the current sophistication of the law. Yet, in the EU – and this is my own view here – the problem may be more acute, for instance with the cartel-like prohibition of certain types of information exchanges. The other over-deterrence concern mentioned by Prof Harrington is that firms may invest excessively into compliance efforts, which can be potentially wasteful from a social perspective.
Prof. Harrington’s next point is about the methodological problems of measuring over or under-deterrence. For instance, studies that seek to assess the cartel overcharge are based of samples of discovered cartels only. There is thus a bias in the data.
Harrington also talks of companies compliance efforts. He says there can be doubts that all those efforts are serious. And he points out to some puzzling examples. Recently, BA promoted to its board a business executive that had been previously charged with price fixing allegations. More generally, agencies should seek to better understand what a firm’s true commitment to compliance is. Compliance declarations may after all be just cheap talk.
Harrington also alludes to screening mechanisms for cartel cases. Unlike what certain enforcers seem to believe, those tools are his view are complementary and not substitutes to leniency programmes. Leniency applicants primarily come forward for fear of being detected. Because screening programmes increase the risk of ex officio detection, they also increase the efficiency of leniency programmes.
Finally, Harrington touches upon individual penalties. If individual penalties are introduced, cartel trust busters will face a wealth of new incentives instruments – individual leniency being one of them – in their hunt against cartels. Harrington believes that races for individual leniency would be a powerful tool to detect cartels.
Here are the presentations.
The Brussels School of Competition (BSC) and the Liege Competition and Innovation Institute (LCII) are pleased to invite you to their joint conference on 22 November 2012.
This event is devoted to Competition Law and Financial Markets (see link to programme at the end of this post). Issues covered span the emerging role of competition law amidst large scale price fixing allegations in the financial industry, the prohibition of the Deutsche Börse/NYSE merger, open and fair access to financial infrastructure, competition in credit rating services, the trade-off between competition enforcement and financial stability, the impact of prudential rules, etc.
To discuss those issues, we have invited a range of triple A experts, including EU Commission and ECB officials, industry representatives, lawyers as well as leading academics.
Programme for download: INVITATION BSC – 22 11 12
For more information, please contact Cécile de Grand Ry (Phone: +32 2 515 08 36 – @:firstname.lastname@example.org )