Chillin'Competition

Relaxing whilst doing Competition Law is not an Oxymoron

Competition Law Everywhere

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I often tell my studs that there’s competition law everywhere.

Here’s an example, found this morning when reading the news at breakfast.

In several recent lectures, I have explained that the case-law insulates organs with “exclusively social functions” from the ambit of the competition rules. This is especially the case of social schemes that operate under the solidarity principle (ECJ, C-159/91 et C-160/91, Poucet and Pistre).

In France, the “mutualités” (complementaty social schemes) have recently announced their intention to collectively raise prices, to pass-on tax increases decided by the Government. I suspect that some of them do not operate under the solidarity principle, and might thus not benefit from the above exception. Needless to say that any coordinated plan to increase prices could be akin to an unlawful concerted practice or decision by associations of  undertakings under Article 101 TFEU.

Moreover, it seems that the governement does not force them to pass-on the price increase (in which case they could benefit from the act of State defense). Hence, the sole economic situation in which 100% repercussion would be unavoidable, is where the “mutualités”  already price at marginal costs. Otherwise, if they make a profit, they can take part (or all) of the tax increase on their profits. In this case, they should compete on the tax increase absorption. A joint decision to transfer it on consumers should thus be forbidden, in that it chills competition.

Now off to watch France v. Wales

Written by Nicolas Petit

15 October 2011 at 9:58 am

Posted in Uncategorized

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