Chillin'Competition

Relaxing whilst doing Competition Law is not an Oxymoron

The vertical expression of a horizontal desire

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A few days ago someone sent us a very interesting piece published by Okeoghene Odudu (who is also the author of a great book on Art. 101) in European Competition Journal (August 2011) under the title: “Indirect Information Exchange and the Constituen Elements of Hub and Spoke Collusion“.

Although we have enjoyed the substance of this article, the reason why it was sent to us in the first place was not its content but rather a particular footnote at the very end of it. It reads as follows:

“187.  In his blog posting of 21 February 2011, Nicolas Petit expressed the view that there was nothing worthy of analysis in the hub-and-spoke phenomenon and concluded by writing, “The bottom-line: I will fight any proposal to organise an event on hub-and-spoke agreements. See https://chillingcompetition.com/2011/02/21/much-ado-about-nothing/.”

[*Note by Alfonso: The original post features a smiley face like this :) right after this quoted statement. The face is nevertheless missing in the quote that appeared in the article. It’s a pity, because it would have been funny to see the smiley appear in European Competition Journal!].

However, by 24 May 2011 he seems to have had a conversion, announcing that, through the Brussels School of Competition Law, he had co-organised a seminar on information exchange, to deal in part with “Sharing Information through Intermediaries (supply-purchase relationships, distribution agreements, meet and release clauses, hub-and-spokes, etc)”. See https://chillingcompetition.com/2011/05/24/information-exchange-in-eu-competition-law-conference-22-june/

We were surprised at this footnote (since we don’t always take what we write seriously, it’s curious to find out that people do), which nonetheless expresses a very legitimate opinion.

To be frank, Nicolas’ first reaction was (I’m quoting a private email): “It seems I made someone unhappy!!??; Weird. I really like what he writes and we don’t even know each other!“.  However, after talking about it we realized that this is actually quite positive. For one, we’re proud to confirm that well-known academics read this blog, and that Chillin’ Competition is quoted in excellent articles appearing in top-notch academic journals. This is a very welcome development. Since we now also mention (and sincerely recommend) Odudu’s article here, this probably will turn into mutually beneficial cross-fertilization!

After witnessing the dangers of academic discussions (ah, the quiet and non-controversial life of the practitioner…), it would appear that the prudent thing to do is to not delve into the debate on whether hub & spoke agreements present or nor any particularly new challenges. Nonetheless, I believe that Nicolas’ posision/s  is/are understandable (and certainly so is Odudu’s).

For those who have not devoted much time to think about them, at first sight hub and spoke agreements are just like tango dancing: they both are the vertical expression of a horizontal desire (I’ve used this joke in class a couple of times and it always works quite well. Last time, however, a student corrected me: she explained that the desire does not necessarily have to be horizontal….; but let’s not go off topic). In that sense, they would not appear to pose any major substantial challenge. I guess this is what Nicolas had in mind when he wrote that there was nothing worthy of analysis in them.

But then, when someone who has experience or studied the complications that the assesment of such practices entails explains these to you (as Odudu’s article does, and as I suppose that whoever spoke at that conference at the BSC did too), one realizes that perhaps these arrangement do pose some enforcement problems. I regard this more as a “learning” process than as a “conversion”, but Oke Odudu probably did well in noting that perceptions over this subject might evolve after further reflection.

However, I don’t think that Nicolas was serious when he said “I will fight any proposal to organise an event on hub and spoke agreements  :)” . In fact, that the smiley face sort of indicates that he was not.

Moreover, had he really been serious in committing not to let anyone express a different point of view at a conference, his position would have been a bit “taliban-ish”, so I would see no problem to his conversion either. In fact, it would have only been a manifestation of what we had already advanced in our publicly stated very own disclaimer:

“The views reflected in our posts do not necessarily represent the views of Chilling Competition or of its authors. They merely reflect the thoughts that crossed our minds at the exact date and time that appears under each post. Those thoughts may actually be radically opposite to the ones that crossed our minds on the following second.

– If anyone feels offended or dislikes any of our posts, then we suggest that you assume that our opinion has evolved since the date of publication and that we have embraced more reasonable opinions.

– If, on the other hand, you like what we say, we recommend that you assume that since our opinions were sound, we will not have felt the need to change them”.

Written by Alfonso Lamadrid

28 March 2012 at 5:02 pm

One Response

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  1. Now you know how I felt when I discovered that apparently something I wrote in a comment on The Volokh Conspiracy is used as an example in the most recent edition of the Blue Book.

    martinned

    28 March 2012 at 7:06 pm


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