Chillin'Competition

Relaxing whilst doing Competition Law is not an Oxymoron

Archive for October 2010

OFT and Competition Commission to merge

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There had been rumours about it in the past few weeks, but it now appears to be confirmed: the Office of Fair Trading and the Competition Commission will be merging as part of the British coalition government´s plan to cut costs (the monopoly in the enforcement of the competition rules is justified on the basis of its alleged efficiencies).

Despite its apparent complexity and notwithstanding certain duplication of tasks between the two agencies, the British enforcement system  has until now worked extremely well. According to press reports, some regard this move as a negative one,  fearing that it will endanger the reputation of the system. I (obviously not an expert on British competition law ) see no major objections to it.  Does anyone have strong feelings about it?

Unrelated: I´ve just learnt via a communication from the ABA that you run the risk of being disbarred if you charge $3.500/hour fees, call a court clerk a “f…. bitch” and suggest that the judge in front of you is a pedophile. I suppose we´ll all have to adapt and change our argumentative techniques..

Written by Alfonso Lamadrid

15 October 2010 at 12:10 pm

AmCham

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There’s only a few excellent speakers on the AT conference circuit. I though I knew most of them.

At yesterday’s Amcham annual conference, I had the great pleasure to meet Bill Batchelor (Baker McKenzie).

Bill is certainly one of the best speakers I met in the past months. Lively, funny and to the point. He made an excellent presentation on a very complex, and possibly borying, subject, i.e. tying and rebates.

I attach his slides  below.

Bill Batchelor – AMCHAM – TYING REBATES

(PS: for my part, I had the difficult task of delivering a talk just after him. I talked about  tying-law post Microsoft. A paper, that I am co-writing with my assistant Norman Neyrinck, will shortly be released on this website).

Written by Nicolas Petit

14 October 2010 at 4:14 pm

Posted in Uncategorized

Teaser

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I attach the slides of our ppt. presentation on judicial review in competition law cases (delivered at the GCLC annual conference last week). A paper will shortly be posted on ssrn.

Slides DG – JUDICIAL REVIEW IN EUROPEAN UNION COMPETITION LAW

 

Written by Nicolas Petit

13 October 2010 at 9:56 pm

Posted in Uncategorized

A French poll, non-profit-maximizing behavior and tacit collusion

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A poll that appeared last Friday on Le Monde offers some interesting data regarding issues that have attracted our attention in the past.

The poll´s main finding is that 71% of French consumers would not switch to a competing internet provider in the event of a price increase.  This further confirms that, as priorly discussed here, assuming profit-maximizing behavior on the part of consumers  -although perhaps inevitable and irreplaceable as a proxy –  is a hell of an assumption.

28% of those who would not switch in response to the hypothetical  price increase in the order of 2-3 euros a month seem not to perceive such increase as a big change. These consumers could be regarded as the per se inelastic part of demand.

If I refer to per se inelasticity it’s because it seems that there´s a greater source of inelasticity derived from consumers expectations with regards to the parallel behavior of competitors:  38% of those who would not switch argue that switching would be pointless given that all undertakings would simultaneously increase their prices too. Interestingly, past experiences of conscious parallelism could thereby be enhancing the rigidity of the market and the individual market power of certain undertakings.

The data reflects a, certainly justified, disbelief on the part of consumers regarding competition law’s ability to face the oligopoly problem (see here for a controversial exception). A chap you might know has written a bit on this topic.

(Thanks to Napoleón Ruiz for the pointer!)

Written by Alfonso Lamadrid

12 October 2010 at 1:46 pm

Posted in Guest bloggers

A funny video

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<object width=”480″ height=”384″><param name=”movie” value=”http://www.dailymotion.com/swf/video/x9o7a6_la-verite-sur-la-religion_webcam?additionalInfos=0″></param><param name=”allowFullScreen” value=”true”></param><param name=”allowScriptAccess” value=”always”></param></object><br /><b><a href=”http://www.dailymotion.com/video/x9o7a6_la-verite-sur-la-religion_webcam”>La verit&eacute; Sur la RELIGION</a></b><br /><i>envoy&eacute; par <a href=”http://www.dailymotion.com/tribaleft”>tribaleft</a&gt;. – <a href=”http://www.dailymotion.com/be-fr/channel/webcam/featured/1″>Plus de vid&eacute;os de blogueurs.</a></i>

The funniest market sharing agreement ever (video in French).  Thanks to Sonia for the pointer.

Written by Nicolas Petit

11 October 2010 at 11:04 am

Posted in Uncategorized

Yet another interesting conference announcement

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In addition to Nico´s recommendation yesterday, here is another interesting conference:

The Centre for Competition Policy at San Pablo CEU´s  Institute of European Studies and the Spanish Competition Authority will be holding an international conference under the title Reviewing Vertical Restraints in Europe: Reform, Key Issues and National Enforcement.  The conference will take place on November 11th and 12th at San Pablo CEU University in Madrid. Amongst the speakers there will be many distinguished scholars and practitioners, and the program looks certainly well (nothing to do with the fact that this is actually the University where I got my law degree).

Btw, only today I´ve received 6 emails advertising conferences and competition law courses (in addition to those, you´ve also read a blog post doing the same). Some of them look great and others don´t. Now,  isn´t there an excess of offer on the “market” for conferences? Should output be somehow restricted?

This excess of offer may be at the origin of an opinion I´ve heard from various people: the traditional Fordham conference, which was held a couple of weeks ago, seems not to be at its best moment in terms of attendance. A real pity for an event which is always amongst the yearly highlights in our small world. Let´s hope it rises back up.

Written by Alfonso Lamadrid

7 October 2010 at 8:30 am

Ties that bind

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In Tomra sytems and others v. Commission the General Court explained that there is no de minimis abuse:

the foreclosure by a dominant undertaking of a substantial part of the market cannot be justified by showing that the contestable part of the market is still sufficient to accommodate a limited number of competitors. … the customers on the foreclosed part of the market should have the opportunity to benefit from whatever degree of competition is possible on the market and competitors should be able to compete on the merits for the entire market and not just for a part of it.”

This is not entirely new. Yet, taken to extremes, this reasoning entails that a firm unlawfully abuses when it forecloses 1% of the market (as rivals cannot compete for the entire market). Also, this means that a dominant firm cannot offer exclusivity (or other ties) to any of its existing customer base.

This principle is clearly at odds with §145 of the Discussion Paper, where the Commission rightly noted, in relation to single branding that:

“The potential negative effects will in general depend on the size of the tied market share”

But this is also at odds with the de minimis doctrine under Article 101 TFEU, where exclusivity agreements fall short of Article 101 when the market share of the producer and purchaser is<15%. The de minimis doctrine considers that there is nothing to care about when an agreement ties les than 15% of a market.

Of course, the EU case-law outranks those instruments. Yet, Tomra is not fully in line with the GC’s own precedents  such as Van den Bergh Foods Ltd. v . Commission, T-65/98  (in particular its §160 which seemed to imply – a contrario – that a 6% foreclosure would have been de minimis).

(Picture possibly subject to copyrights – am a great fan of this band)

Written by Nicolas Petit

6 October 2010 at 5:49 pm

Posted in Case-Law

Conference Announcements

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The Academic Society for Competition Law (ASCOLA) in cooperation with King’s College London will hold its 6th Conference in London on 1 and 2 July 2011 on the topic of ‘New Competition Jurisdictions: Shaping Policies and Building Institutions’ (see call for papers below).

Also, the Austrian Competition Authority will host a Panel Discussion on a subject of dear interest to me: “Screening Devices for Detecting Collusion”, with Prof. Rosa M. Abrantes-Metz, PhD. Prof. Maarten Janssen, PhD and  Dr. jur. Christina Hummer,  will comment. This seminar will take place on Monday, October 18, 2010 in Vienna (see info below).

Written by Nicolas Petit

5 October 2010 at 6:49 pm

Posted in Events

First course at the BSC this afternoon

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Went really well, a good group of students (around 30 of them), mostly in-house lawyers.

Great infrastructure and very stimulating course. Am hungry for more.

Thanks also to Alfonso for accepting to talk to my students in Liege.

Written by Nicolas Petit

1 October 2010 at 10:00 pm

Posted in Uncategorized