Chillin'Competition

Relaxing whilst doing Competition Law is not an Oxymoron

Archive for January 2013

Antitrust and the political center

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A few weeks ago I published a post called “Antitrust and political imbecility“. The raw ideas in it had been in my mind for a while, but conscious that I would likely not take the time to refine them, I chose to publish them on this blog with the hope that they would benefit from public discussion. I wasn’t particularly proud of this post, but Lindsay Mcsweeney (Competition Policy International) thought it was original and asked me to develop it for a special issue of CPI’s Antitrust Chronicle to be published right after Christmas. I accepted thinking that it would only take a few hours of my holidays; little did I know that I would break my arm and go through some pains to finish it! (btw, I’m back on track as of today). In any event, and thanks to Lindays’s pressure encouragement,  it’s done.

Those interested in reading my take on why antitrust law can be regarded as sensible centrist economic policy can do so here. Non-CPI suscribers can read it here (courtersy of CPI): Antitrust and the political center-

Any critical feedback would be most welcome!

Written by Alfonso Lamadrid

31 January 2013 at 1:47 am

New paper

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I just posted a new paper on ssrn. It is entitled “New Challenges for 21st Century Competition Authorities“. It is a short and modest paper, which builds on my presentation in Hong Kong a few months ago. Hereafter, the abstract:

This paper discusses challenges for competition authorities in the 21st century. Those challenges were identified on the basis of a statistical review of the articles published since January 2011 in five major antitrust law journals. The assumption underlying this literature review is that the topics that statistically attract the most the attention from contemporary antitrust scholars are those that will likely constitute the main challenges for 21st century competition authorities.

Written by Nicolas Petit

30 January 2013 at 7:19 am

On judicial appointments

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We’re quite frustrated at the attitude of some Member States with regard to judicial appointments, which, to put it mildly, is disgraceful

First, because in spite of having been urged by the Court to confirm whether they would maintain or replace their judges, many Member States have remained totally inactive, thus effectively hampering the Court from planning its activities for the upcoming months. Second, because they fail to realize that continuity is a positive thing at an institution of this sort. Third, because they have found it impossible to agree on an increase in the number of judges and continue to lose time fighting as kids over who gets to nominate more judges. Fourth, because they fail to grasp the relevance of the Courts and of their members, and therefore take appointments lightly (hence the rejections of several unsuitable candidates proposed by Malta, Bulgaria, Sweden and Greece by the 255 Committee, which are shameful not for the individuals concerned, but for whoever nominates them).

We’ve said it before, but WE’LL SAY IT LOUDER NOW: WHY ON EARTH CANNOT MEMBER STATES FOLLOW THE EXAMPLE OF, E.G.,THE NETHERLANDS, THE UK, SLOVENIA OR CROATIA AND START SELECTING CANDIDATES PURSUANT TO OPEN MERITS-BASED FRAND COMPETITIONS?

Written by Alfonso Lamadrid

29 January 2013 at 6:34 pm

Nailing Mittal?

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Last week, the giant steel maker Arcelor Mittal announced the shutting down of several plants in Liege. 1,300 jobs are threatened.

This news has taken many by surprise. Politicians cry betrayal. Last year, Mittal had promised to invest millions of € in Liege.

In fairness, the posture of politicians is naive and cynical.

In Europe’s volatile and distressed economic context, how could politicians ever believe – and try to make believe – in the oral commitments made by Mittal (why did not they ask him to put commitments to paper?). All the more considering that since 20 years, industry analysts keep making cassandresque predictions, describing the steel industry in Liege as morribond.

At university, several colleagues asked me whether EU competition law could possibly undermine Arcelor Mittal’s proposed strategy. In the past hours, the debate has focused on whether a proposed nationalisation of the Liege plants by the Belgian State could constitute lawful/unlawful State aid. I am no State aid expert, so I’ll conveniently decline to answer.

A more powerful, yet wholly uncertain possibility would be to apply Article 102 (b) TFEU or its national equivalent under Belgian law. On its website, Arcelor Mittal says it enjoys a “leading market position and market share” in Western Europe and Eastern Europe.  Under a narrow market definition, one may thus well find a dominant position. And given that the stated purpose of Arcelor Mittal’s strategy is to reduce overcapacities on Western steel markets and stabilize (or raise) prices, why not hold the shutting down of steel plants akin to unlawful abusive exploitation?

After all, if Mittal believes he can influence prices – and on this we may trust him – by closing off some plants, then this is implicit recognition that he enjoys some degree of monopoly power.

The bottom line: on cursory analysis, the law provides a legal basis to nail Mittal. But are the facts supportive?

Written by Nicolas Petit

28 January 2013 at 5:01 pm

If you need a fix

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Has the Commission turned into a settlement junkie addict?

Until now, the Commission was ready to go through all sorts of legal compromissions to bring cases under the Article 9 commitments procedure:

  • In Microsoft II, the Commission settled a case which 3 years before had been solved with a fine (thereby violating the principle that settlements are not apposite in cases where fines are warranted, see recital 13 of Regulation 1/2003).
  • In S&P, IBM and in a gaggle of energy cases, the Commission settled cases where anticompetitive effects had lasted over a significant period of time, thereby failing to punish past anticompetitive conduct (and in turn, denying justice to the victims of the infringement).
  • In the upcoming Google settlement, the Commission will close a case which raises novel legal and economic issues. Yet, how can the Commission possibly suspect an infringement short of any significant precedent?

As I was hearing exams all day, I had the occasion to read more on the commitments from Apple and four publishing groups for the sale of e-books.

I was truly baffled when I realized, in this case, that the Commission had accepted to settle what it otherwise deems a “hardcore restriction“, namely an industry-wide resale price maintenance scheme.

With this new precedent, the next question is: will the Commission ever cross the rubicon and accept to settle a cartel case? The Libor investigations could provide good candidates for such a new policy. In those cases, the Commission may be reluctant to hammer the Libor participants with fines, on pain of undoing 5 years of accomodating State aid policy with Article 101 TFEU penalties. An article 9  settlement would provide the Commission with a “good looking” exit strategy.

From a more general standpoint, the Commission’s  “Settle ‘Em All” policy finds no merit in our opinion, and may well have adverse effects. After all, if firms know they can settle anything and face no penalties, why should they observe the law in the first place?

Written by Nicolas Petit

25 January 2013 at 8:53 pm

Posted in Uncategorized

Should I Stay or Should I Go?

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Comes the end of the day, most young lawyers face this question.

And many decide to stay at the office even if they have nothing to do, just to look busy before partners.

Courtesy of a keen reader of this blog possibly underoccupied in her own professional organisation ;): a nice chart on when to go home

Lawyers

Written by Nicolas Petit

24 January 2013 at 3:21 pm

Posted in Uncategorized

State aid and the European Economic Constitution

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9781849461054

With tough budget cuts in State universities and the bonkers rates charged by some academic publishers, university libraries are being margin squeezed.

At chillin’competition, we have thus decided to advertise competition law and economics books, provided we receive a free copy from the editor.

It is our pleasure today to advertise a new book entitled “‘State Aid and the European Economic Constitution” by Francesco de Cecco. The book is published by Hart Publishing. A full description + all relevant info can be found hereafter.

State Aid and the European Economic Constitution

By Francesco de Cecco

Recent years have seen the rise of EU State aid law as a crucial component of the European economic constitution. To date, however, the literature has neglected the contribution of this area of EU law to the internal market. This book seeks to fill this gap in our understanding of the economic constitution by exploring the significance of State aid law in addressing questions that go to the core of the internal market project. It does so by examining the case law relating to three different activities that Member States engage in: market participation, market regulation, and funding for Services of General Economic Interest. Each of these areas offers insights into fundamental questions surrounding the economic constitution, such as the separation between the State and the market, the scope for Member States to engage in regulatory competition, and the tension between market and nonmarket concerns.

Link to table of contents http://www.hartpub.co.uk/pdf/9781849461054.pdf

The Author

Francesco de Cecco is a Lecturer in Law at Newcastle University.

December 2012   210pp   Hbk   9781849461054  RSP: £50 / US$100

20% DISCOUNT PRICE: £40 /  US$80

Order Online

If you would like to place an order you can do so through the Hart Publishing website (links below). To receive the discount please mention ref: ‘CCB’ in the special instructions field. Please note that the discount will not be shown on your order but will be applied when your order is processed.

UK, EU and ROW: http://www.hartpub.co.uk/books/details.asp?isbn=9781849461054

US: http://www.hartpublishingusa.com/books/details.asp?isbn=978184946105

If you have any questions please contact Hart Publishing

Hart Publishing Ltd, 16C Worcester Place, Oxford, OX1 2JW, UK
Tel No: 01865 517530

Fax No: 01865 510710

E-mail: mail@hartpub.co.uk

Website: www.hartpub.co.uk

Hart Publishing Ltd. is registered in England No. 3307205

 

Written by Nicolas Petit

23 January 2013 at 4:16 pm