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Archive for September 2012

The Friday Slot (12) Einer Elhauge

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For this twelfth edition of The Friday Slot Chillin’Competition is proud to bring to you an interview with a true antitrust guru: Einer Elhauge. Einer is the Petrie Professor of Law at Harvard Law School, where he teaches antitrust and many other subjects. He was actually one of the reasons why I applied for the Harvard LL.M (I got unlucky because he did not teach antitrust that year!). When someone asks me about the students and professors at HLS my usual response is that most people there are generally as smart/dumb as most other people, with the difference that they’ve had more opportunities in life. There are some exceptions to this and Einer is one of them: you can quickly tell that his mind works at a different pace….  Aside from teaching at Harvard he also testifies regularly as an expert in antitrust economics and is President of Legal Economics; he was Chairman of the Antitrust Advisory Committee to the 2008 Obama Campaign, and is currently on the 2012 ABA Antitrust Transition Task Force.  His most recent book is Obamacare on Trial, and his past books include Global Antitrust Law and Economics; Global Competition Law and Economics; U.S. Antitrust Law and Economics; Statutory Default Rules; and Research Handbook on the Economics of Antitrust Law.  He has also authored many other articles on antitrust and other topics.  

For those wondering: the pic above shows Einer trying to move mountains 😉  We leave you with his great replies:

Why do you work in antitrust law? How did you first get into it?

I loved antitrust from the first class I had with Phil Areeda.  It just came so easily and naturally to me, and it involved a combination of creativity and analytical precision that I found very attractive from the get go.  I knew immediately that I had found my calling.  (I had already gone to and left medical school, so finding my calling did not initially come easily to me.)

What do you like the least about your job?

Grading exams.  But then again, the rest of the job of being a law professor is something I would do for free, so it is not so bad if I take the view that my entire annual salary is for grading exams.

What do you like the most about your job?

Thinking about whatever I find most interesting.  Really, that is an incredible luxury that I am thankful for every day.

Any favorite antitrust books?  And favorite non-antitrust law books?

Favorite antitrust books.  Bork’s The Antitrust Paradox: A lot was wrong in it, but he was also right in skewering many bad prior antitrust doctrines, and it is still the best written antitrust book ever.  Carlton & Perloff, Modern Industrial Organization: A wonderfully clear exposition of the antitrust economics that every antitrust lawyer and professor should master.

Favorite non-antitrust law booksEly’s Democracy and Distrust: Of course, that may be because it essentially used an antitrust theory to explain constitutional law.  Black’s Law Dictionary: I have always been impressed by the incredible brief lucidity of this book; it explains an amazing amount of conceptual logic in few words on every legal topic under the sun.  The Federalist Papers: A beautiful exposition of political thought, even though recent historical work suggests it might not have influenced the Constitutional adoption that much.  Richard Posner, Economic Analysis of Law: Never has any human said so many insightful things about so many areas of law in just one book; he had the advantage of living at a time when there was lots of low-hanging fruit, but by God he picked them all clean.  Bruce Ackerman, Social Justice in the Liberal State: It kept me up all night once because I found it so fascinating.  David Strauss, The Living Constitution: An elegant explanation for many anomalies in constitutional law.  John Rawls, A Theory of Justice: The philosopher most relevant to many legal issues, even though his mini-max is to me implausibly risk-averse.  Bob Woodward, The Brethren: Just a lot of fun; the stories about Chief Justice Burger are worth the price alone.   John Haar, A Civil Action: I could not put it down; who would have thought one could make civil tort litigation so gripping?

 You teach comparative US-EU antitrust law. How big is the transatlantic divide?

I think it is actually quite exaggerated.  Having co-written a Global Antitrust Casebook and taught Global Antitrust many times, I find that when you teach the cases on any particular topic side by side, you generally find that often there is a formally different way of expressing things, but a lot of substantive convergence.  And when the substance diverges, I think it can often be explained by a divergence in remedies.  The US courts repeatedly cite the overdeterrence threat from criminal penalties, private treble damages and class actions as a justification for narrowing US antitrust law.  That same logic suggests that competition law should be broader where those remedies do not exist, like in the EC.

 You were the chairman of the Antitrust Advisory Committee for the Obama campaign in 2008 (also of the Blogs and Op-Eds Committee and a member of the health policy group –congrats on this last one!). How has antitrust enforcement under the Obama administration performed in comparison with previous Administrations?

I think it is impossible for any outsider to tell for sure because performing well is not being more active or less active in the abstract.  It is bringing antitrust cases when they should be brought and not bringing them when they should not.  And to tell whether that is happening to a great or lesser extent than prior administrations, one would need the confidential case information on all the cases, which obviously we lack.  The only ones who really know for sure are the agency officials, and they are not the most neutral judges of how well they have done.

Let’s do it like economists => assume that you could change 3 antitrust rules, principles, judgments or institutions. What would you do?

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Written by Alfonso Lamadrid

28 September 2012 at 10:00 am

Posted in The Friday Slot

Conference on Fines, 3 December 2012

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On 3 December 2012, TILEC and the Liege Competition & Innovation Institute (LCII, under construction) will hold in Brussels a one day event entitled:

Deterring EU Competition Law Infringements:

Are We Using the Right Sanctions?

This event will gather prominent speakers including judges from the EU and the US,  Commission officials, academics, practitioners and in-house counsels.

I attach the programme below.

This is undoubtedly one of the hotest issues in modern EU competition law. Hopefully, after this event, we’ll see a little clearer on what needs to be done to achieve optimal deterrence.

Download full programme and registration form:

Deterring Competition Law Infringements – Conference Programme and Registration Form

Written by Nicolas Petit

27 September 2012 at 7:10 am

Posted in Events

How to work less: Chillin’ Competition´s Ménages à Trois

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We are starting off a new section at Chillin’Competition called “Ménage à Trois”.

Readers of this blog know that I have a tendency not to over-criticize the European Commission. This doesn’t however blind me;  anyone familiar with the permanent revolution suffered by EU competition law in recent years will find a common denominator in all major policy reforms in which the Commission has embarked: they were all aimed at working less under the pretext of refocusing  (think about 1/2003; the State aid action plan, the Guidance paper on Art. 102, etc)      🙂

Nicolas and myself have decided to follow the Commission’s lazy wise approach to policy reforms:

We  have realized that we often can’t find the time to timely report to you the most interesting aspects of case-law developments. Also, we tend to give you our personal views on issues, which by definition are subjective and incomplete. So we asked ourselves (i) how can we follow case-law developments more closely and give readers subjective yet balanced opinions?; and (ii) how can we do that by working less? (i.e. what would the Commission do?)

So here’s the plan: each time a relevant development takes place we will contact three people. The idea is for one of them to write a post on the development at issue. Instead of publishing the post right away, we will circulate it among the three experts, who will then discuss it by email (Nico and I may intervene as well). We will then post on the blog the  original post together with the trilateral debate that it may have given rise to.

We welcome applications for experts who wish to be contacted, as well as suggestions for possible topics.  We also want to profit from this new section to bring younger lawyers or academics to the sporlight and to have the minteract with other established heavy weights.

Our first ménage à trois will deal with last week’s Judgment in the Greek Lignite case (concerning the inteface between Arts. 106 and 102 TFUE). Our three inaugural guests will be three good friends of this blog: two of them (Makis Komninos -White&Case- and Marixenia Davilla -Shearman&Sterling- were actually involved in the case (on the winning side) and the third (José Luis Buendía -Garrigues-) is the author of the bible on Article 106 (of which a new edition is on the pipeline).

Written by Alfonso Lamadrid

26 September 2012 at 12:19 pm

Posted in Uncategorized

Monday Read

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Our colleague Christian Bergqvist, Associate Professor at Copenhagen University has offered us a working paper version of his piece on the “Use and Abuse of EU Competition Law”. See link at the end of this post.

In brief, Christian reviews the case-law under 101, 102 and the EUMR, searching whether the rules have been twisted, bent or manipulated to achieve objectives alien to the protection of competition.

A very interesting read. Christian is looking for comments on his work. You may directly write to him at: CBE@jur.ku.dk

Use and abuse of competition law (1)

Written by Nicolas Petit

24 September 2012 at 7:00 am

Breaking News

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I was baffled yesterday when I learnt that Professor Richard Whish is leaving King’s College London.

Richard is one of our antitrust gods (we are polytheists at chillincompetition), and the author of a true competition bible.

(Click here to read our Friday-slot interview with him).

How can King’s let Richard go? If I were King’s dean, I would have offered a raise.

PS: I attach hereafter the slides I presented yesterday at a conference on Aims and Values in EU Competition Law in Copenhagen. The slides make a number of remarks on (i) industrial policy and competition law; and (ii) the current status of the Guidance paper on Article 102 TFEU.

Aims and Values in EU Competition Law – N PETIT (19 09 12)

Thanks to Caroline Heide Jorgensen and Christian Bergqvist for having me on the programme of this very good conference.

Written by Nicolas Petit

21 September 2012 at 12:46 pm

XVI Edition of the Competition Law Program at the IEB (Madrid)

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For 15 years now Luis Ortiz Blanco has been directing a top-notch competition law course in Madrid, which is actually where Nico and I first met.  I took this program as a student already 8 years ago, have lectured on it since then, and this year I’m starting to co-direct it together with Luis.

The line-up of more than 50 high-profile guest speakers who come every year from all over Europe to lecture in Madrid is a true Who’s Who of EU competition law experts. Moreover, the 115 hours of scheduled classes allow for a more detailed coverage than that offered by many other competition law courses on the market. About half of the course is lectured in English. Price wise the course is unbeatable: full registration is available for only 3,000 euros.

The final program for each module and seminar has yet to be confirmed, but the overall structure and dates have been set, so I’ve included the info below. Anyone interested can register both for the full program or just for specific module/s or seminar/s.  Anyone interested in more information can contact me at alfonso.lamadrid@garrigues.com

The 2013 program will be structured as follows:

– An  inaugural/introductory session will take place on January 11.

– A module on cartels (coordinated by myself) will be held on January 14-16.

– A module on other restrictive agreements and practices (coordinated by Juan Andrés García Alonso; Peugeot) will take place on January 21-23.

– On February 1 there will be a seminar on recent developments in relation to Art. 101 (coordinated by Fernando Castillo de la Torre and Eric Gippini Fournier, both from the Legal Service of the European Commission).

– A module on abuse of dominance (coordinated by Alvaro Ramos; Legal Director at Cisco Systems) will be held on February 4-6.

A module on merger control (coordinated by Jerónimo Maíllo; San Pablo CEU University) will be held on February 11-13.

A seminar on competition law and regulation in network industries (coordinated by myself) will be held on February 18-20;

– A module on the application of competition and state aid rules to public entities (coordinated by José Luis Buendía; Partner at Garrigues) will take place on February 28- March 1.

A seminar on recent developments in abuse of dominance and merger control coordinated by Cecilio Madero (Deputy Director General for Antitrust at DG COMP), Nicholas Banasevic and Per Hellström (both Heads of Unit at DG COMP) will be held on March 8.

– A seminar on competition law and IP (coordinated by Álvaro Ramos; Legal Director at Cisco Systems) will take place on March 15.

Written by Alfonso Lamadrid

20 September 2012 at 9:53 pm

European Law Moot Court Competition 2012/13

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The 2012/2012 edition of the European Law Moot Court Competition (ELMC) is on, and this edition’s case is pretty much about competition law (you can download the case by clicking here) (the competition’s rules are available here).

The ELMC is a great initiative (for an overview of its history click here) that has introduced many to the beauty of EU Law (how geekish did that sound?). As such, it deserves all possible pubicity.

If you’re reading this and you’re a student, you should seriously consider participating (Nico and I unfortunately never did, but all of our friends who took part on the competition speak wonders about it).

As a way of humbly contributing to this initiative, the winning team will be invited to discuss the competition law aspects of the case here.

Written by Alfonso Lamadrid

19 September 2012 at 7:47 pm

Posted in Events

Never mind! (Case T-119/09, Protégé v Commission)

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In December 2010 we wrote a post on the General Court’s Judgment in Case T-427/08, CEAHR v Commission. Our post interpreted the Judgment as effectively limiting the Commission’s discretion to reject complaints.

That post concluded with the following opinion: “this is a most welcome judgment. Indeed, whereas previous case law imposed upon the Commission the burden of  “considering attentively all the matters of fact and of law which the appliccant brought to its attention”, the General Court has, by virtue of its in-depth review, turned those words -until now a mere formality- into a real, practical, obligation”.

But now we’ve read last Thursday’s Judgment in Case T-119/09, Protégé v Commission (concerning an appeal against a decision rejecting an abuse of dominace -sham litigation- complaint against Pernod Ricard) (available here, but only in French) (how wouldn’t we read a competition Judgment in which the relevant market is the one for Irish whiskey?) and I’ve realized that perhaps we were wrong.

The Protégé Judgment makes it clear that the strict analysis of the Commission’s exercise of its discretionary powers carried out in CEAHR was an exception. Certainly Protégés theory of harm doesn’t appear to be a particularly solid one to say the least (in this sense, the contested Decision and the Judgment are quite understandable). What is surprising is not the outcome of the case, not even the GC’s reasoning; what strikes me is that the Judgment does not make a single reference to the former precedent in CEAHR. In our view, by completely ignoring CEHAR the GC might have effectively overruled it.

The overruling becomes more explicit with regard to one particular point. You may recall the suggestion in paras. 155 and 174 of CEAHR that when an alleged infringement affects several Member States there could be a sort of presumption of “EU” (why do we still say “Community” when we talk about this topic?)  interest. In Protégé the GC makes it very clear that this is not the case.

In sum, we are still governed by Automec. The Commission can very much decide what’s interesting and what’s not provided that it doesn’t mess up big time  incur in a manifest error of appraisal in dealing with the factual elements that it may put forward to justify a rejection.

By the way, we have heard through the gravepine that the upcoming hearings on the De Beers distribution case may feature some interesting discussions on the notion of Community EU interest. We’ll stay alert.

So, to those who read our post on CEAHR: never mind.  To the Commission: false alarm.

Written by Alfonso Lamadrid

18 September 2012 at 11:08 pm

Posted in Case-Law

Politically incorrect: the political process through an antitrust lens

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Since I joined Chillin’Competition almost 2 years ago I always had the intention to write a couple of long and well thought out posts on antitrust and politics. One would attempt to apply antitrust principles and rules to political markets (one day we should also try to do that with the legal market too!), and the other would ideally explore the political content of antitrust in different jurisdictions. Undertaking such exercises would have the virtue of linking two of my preferred subjects, and -I’m pretty sure- would also yield some interesting results. However, I never found the time to develop these ideas and, since it is unlikely that I will find it soon, I’ve decided to hastily sketch what I had in mind without developing it further despite the obvious risk of sounding obvious. Let’s start with one question: what can antitrust tell us about the dynamics of political systems?

If you compare the “political market” to any traditional market (at the end of the day, parties/firms compete for the favor of voters/consumers), you will inevitably arrive to the conclusion that it would be an ideal market for antitrust enforcement. Think about it, the political systems in most developed countries are duopolies (the U.S. is a clear example or partisan parity with shifting temporary monopolies), oligopolies (also with temporary and assailable monopolies) and even permanent monopolies.

These concentrated market structures with transient or permanent monopolies can give rise to several concerns which are familiar to any antitrust lawyer. Political parties (be it the one in government or the one in government in combination with other major parties) unilaterally or collectively act to protect an individual or collective dominant position. Most often this is done by deciding to implement certain electoral rules that foreclose entry or growth by third parties.

Public choice theory has dealt ad nauseam with the issue of self-interested lawmakers (i.e. the foxes guarding the henhouse). That’s what this is about too. Political parties are the ones in charge of adopting the rules that govern the functioning of the political market (how parties are financed, how electoral regimes work -i.e. how parties are rewarded-, how third-party entry in the political market can take place, etc.) and other related markets (such as media-related ones). These situations are not strangers to antitrust analysis; just think of well-known EU competition law cases concerning regulatory professional bodies such as Wouters or Piau. The main difference between those precedents and the situation at issue in political markets is that the consequences of the latter are much more significant and potentially harmful.

The idea of applying antitrust principles to examine the political process is by no means original. Some well-known scholars have already done it in the past, generally in relation to gerrymandering practices (see, among others,  Issacharoff´s Gerrymandering and Political Cartels or the great amicus curiae that Einer Elhauge submitted to the U.S. Supreme Court, also in a gerrymandering case (available here).

To be sure, political parties are exempt from the application of antitrust rules, and there might be good reasons for this. However, in view of current enforcement trends that have extended antitrust liability to collective bargaining agreements by workers’ unions and even to governmental bodies  -see here for a Spanish precedent-, one can’t help wonder whether political parties are really shielded from the potential application of antitrust rules.

[This may sound subversive, but, we’ve consistently proposed to extend the reach of the antitrust rules to those who appeared to be exempt from them…. remember our post suggesting an antitrust challenge to God? ]  😉

In any event, even if antitrust standards aren’t applicable, they are useful to help us realize -regardless of whatever political beliefes one may have- about legal but undue practices carried out by incumbents with the aim of thwarting political competition. I’m sure most of you can quickly come up with a good bunch of examples…

Written by Alfonso Lamadrid

17 September 2012 at 4:36 pm

The Friday Slot (11) – Bernard van de Walle de Ghelcke

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It’s been a while since we last had someone on the Friday Slot. For this new start, Bernard van de Walle de Ghelcke (Linklaters) has accepted to answer our questions. I met Bernard when I started as the bag-carrier at the GCLC, and we then worked together when he latter served as President. Bernard is a “gentleman” competition lawyer, a thorough expert of Regulation 1/2003 and on top of this someone who has relentlessly worked to foster debate on competition issues. Think of his role at the GCLC or at the head of the main Belgian competition gazette. He also has a strong track record of being able to communicate his passions to other. In addition to the many students he introduced to EU law at the College of Europe, his son is a young, enthusiastic antitrust lawyer at a Brussels law-firm.

1. “Oscar” of the best competition law book? And of the best non-competition law book?

I have always “Bellamy and Child” close to hand (and “the” Kerse for Antitrust procedure). However it is striking how increasingly textbooks seem to lose importance. One looks “life” at the case law as well as to recent specialized publications. As a practitioner our workload does not allow much academic reading unfortunately and we have to focus on the literature needed for a specific case. As regards competition law theory I often go back to the masterpiece “Politique de la Concurrence de la CEE” by the late Jacques A. Vandamme. It was early days of EC competition law but all the founding principles are there.

Outside competition law there are so many … I still consult De Page, Droit civil belge, Van Ryn & Heenen, Principes de droit commercial belge and W. Van Gerven’s “Algemeen deel” in Beginselen van Belgisch privaatrecht. As I am very interested in EU institutional law, K. Lenaerts’ “Constitutional Law of the European Union” is a must as well as the Wyatt and Dashwood “European Union law”.

2. “Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development?

Best : the Court of Justice case law applying fundamental rights (Kadi) …. Worst : the same case law where it is timid or dismissive and fails to take all consequences.

The case law on parental liability is very troubling.

3. Let’s do it like economists => assume that you could change 3 rules, principles, judgments, institutions in the current EU competition system. What would you do?

  • I know it is not realistic and maybe against a trend but separate investigation, prosecution and decision for antitrust enforcement. This is the only decent system in an “état de droit”. Or why did we have Montesquieu for ?
  • Force the Commission to also adopt positive decisions.
  • Revisit the whole system and test it as to what competition law enforcement does for competitivity, industrial policy, employment and welfare.

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Written by Nicolas Petit

14 September 2012 at 5:05 pm

Posted in The Friday Slot