Author Archive
The Friday Slot (11) – Bernard van de Walle de Ghelcke
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.
Change of Times
In contemporary antitrust law, price-fixers have enjoyed a somewhat “gentlemanesque” image.
Price-fixers, as the story goes, would typically be well-instructed managers, who would convene in the smoked-filled rooms of luxury hotels, drink Cognac and exchange views about prices, politics and philosophy.
But since yesterday, the masks have fallen, revealing the true face of XXIst century price fixers.
According to this website, and as reported by the Handelsblatt:
“the Steel managers who were fixing prices and dividing up the railway track market took Deutsche Bahn employees to brothels after talking business over dinner, spending more than €71,000 on “entertaining” over five years“.
The bottom-line (courtesy of a good friend met yesterday at RBB’s party): “Germans always put business before pleasure“.
Compliance
Is the Office of Fair Trading racing for the prize of the most business-friendly competition authority in Europe?
I know this reads a bit controversial, but many have had the impression that, in recent years, the OFT was on a soft enforcement course, preferring to focus on high-level policy work, than on running – and terminating – cases.
A few days ago, the OFT issued a document entitled “OFT’s guidance as to the appropriate amount of a penalty“.
In this document, the OFT announces – with many caveats though – that firms that have compliance programme can benefit from mitigating circumstances.
Concretely, the OFT may offer a 10% haircut on the anticipated fine.
Here’s the text of the Guidelines:
§2.15 “Mitigating factors include: […] adequate steps having been taken with a view to ensuring compliance with Articles 101 and 102 and the Chapter I and Chapter II prohibitions”
And footnote 26: “The starting position with regard to competition law compliance activities will be neutral but the OFT will consider carefully whether evidence presented of an undertaking’s compliance activities in a particular case merits a discount from the penalty of up to 10 per cent. Thus, the mere existence of compliance activities will not be treated as a mitigating factor. However, in an individual case, evidence of adequate steps having been taken to achieve a clear and unambiguous commitment to competition law compliance throughout the organisation (from the top down) – together with appropriate steps relating to competition law risk identification, risk assessment, risk mitigation and review activities – will likely be treated as a mitigating factor. The business will need to demonstrate that the steps taken were appropriate to the size of the business concerned and its overall level of competition risk. It will also need to present evidence on the steps it took to review its compliance activities, and change them as appropriate, in light of the events that led to the investigation at hand“
I have expressed elsewhere my intuitive concerns about the sophistic argument that agencies should reward compliance programmes with discounts on fines, so as to induce firms to set up such programmes. Here’s what springs to mind:
First, it is somewhat odd to provide financial incentives to promote compliance with the law, or to be more accurate to reward the initiative of trying to comply with the law (in reality, the caught firm did not comply). If we push this logic to its end, agencies should then reward infringing companies if they can prove that they have hired lawyers to obtain regular competition advice.
Second, rewards on compliance programmes could have perverse effects, with firms adopting compliance programmes as a damage limitation mechanism, which limits the cost of punishment if they ever get caught. In other words, the reward on the existence of a compliance programme acts like an insurance policy, which in turns reduces firms risk aversion to antitrust infringements.
Third, a well-designed compliance programme can adversely promote the risk of antitrust infringement, if clever managers understand better how to exploit the loopholes and deficiencies of the antitrust enforcement system. Why reward this?
Finally, compliance programmes have benefits at any rate, and there’s no need for an additional fining stimulus to encourage their adoption. Compliance programmes promote awareness to what constitutes an antitrust infringement within firms, and to how much it costs to commit one. They thus decrease the probability of antitrust infringement in the first place, and with it the risk of antitrust penalties. Moreover, with better trained in-house lawyers and business executives, the legal costs of outsourcing of competitive assessments to external lawyers may decrease.
My bottom-line: rather than tinkering with the fining system to foster compliance, let’s just turn to individual sanctions (director disqualification and prison sentences).
Conference – EU Competition Law and Financial Markets
On 22 November 2012, the Brussels School of Competition (BSC) and the Liege Competition and Innovation Institute (LCII) will hold in Brussels a joint conference on Competition Law and Financial Markets.
Issues covered span the emerging role of competition law amidst large scale price fixing allegations in the financial industry, open and fair access to financial infrastructure, competition in credit rating services, the trade-off between competition enforcement and financial stability, the impact of prudential rules, etc.
No State aid on the menu, there’s been far too many events devoted to this topic in recent months.
To discuss those issues, we have invited a range of triple A experts, including EU Commission and ECB officials, industry representatives, lawyers as well as leading academics.
More info on the programme can be found here. The registration form is accessible via this hyperlink.
Misc.
A hotch potch of AT-related news, including some self propaganda:
- The next GCLC lunch talk will be devoted to the Microsoft compliance case, following the General Court’s judgment in Case T-167/08. Speakers are Eric Barbier de la Serre (Jones Day) and Thomas Kramler (COMP). See link hereafter for registration form: 61st GCLC Lunch Talk – Registration form
- The next GCLC annual conference will take place on 8 and 9 November, and will be devoted to “Competition law in times of economic crisis”. The final agenda is in the making.
- I will be speaking at a conference in Hong Kong on 19 October 2012. Just cannot wait to be there. See here for the conference website and hereafter for the programme: Leaflet_2012_9_4. My speech will be about challenges for 21st century competition authorities. If you have any suggestions of topics, items, or remarks to convey at the conference, please do not hesitate to drop a line;
- Our good friend Ewoud Sakkers from COMP is taking a one year sabbatical. He will be thinking and writing at Yale law school. May he also take some good rest while there;
- Marek Martyniszyn, a Senior Research Fellow at the Institute for Consumer Antitrust Studies (Loyola University Chicago) has posted online an interesting book review of the liber amicorum in honour of Professor Jacques Bourgeois.
Antitrust Comics
It is a well-known fact that competition lawyers increasingly compete in court with economists (at least in the US).
But they may now have to compete with comics artists.
Some background: earlier in 2012, the DoJ filed suit against Apple and 5 e-books publishers for alleged violations of Section 1 of the Sherman Act.
Later in 2012, three publishers got off the hook, settling the case with the DoJ.
But the feud goes on between Apple, two publishers and the DoJ.
In this context, Bob Kohn, a media expert, has refiled a 25 pages request to participate as amicus curiae in the form of a comics. See link hereafter: 104906877-Kohn-Amicus (2)
The result is amazing, and possibly more convincing that the initial submission. Kohn even managed to quote judicial precedents.
So here goes the question: besides mock trial sessions, should law schools introduce drawing courses in their curriculums?
PS: the above pic is taken from the last strips I read. The Boys is dark, violent and very politically incorrect. A must read.
PS2: thanks to David Mamane (Schellenberg Wittmer) for the pointer.
Entry
With the fallout of the financial crisis, very few law firms have opened offices in Brussels in recent years.
To my best knowledge, the latest one would be Wilson Sonsini.
Several big US law firms without AT capabilities in Brussels thus keep referring work to EU law firms.
This decision clearly can be questioned under a simple cost/benefit analysis. Setting-up an office in Brussels seems to represent little costs, and can surely bring good money. All the more so given the thriving state of antitrust enforcement in the EU, irrespective of the crisis.
This may be what has prompted Baker Botts to launch today a Brussels practice.
Congrats and best of lucks to both Paul Lugard and Catriona Hatton for this new venture!
BTW, Baker Botts is known for being strong in the oil business, as well as for having taken over a large chunk of ex-Howrey lawyers in the US.
Best Antitrust Movie Ever
The Australian Competition and Consumer Commission just released “The Marker”.
In the category best compliance film, this one is poised to earn our Oscar this year.
Most antitrust films that we know look like crafted and played by competition officials themselves. Think of the hilarious “The Raid“.
Here, everything looks like the standard Hollywood film, i.e. casting, direction, music, photography, etc.
A real must see.
PS: Thanks to Joachim Marchandise for the pointer.
Where to work in Brussels?
Freshly graduated students often come with queries about life in law firms.
Many questions are related to wages and working hours.
But the key question is always about how cool (or stressful) it is to work for this or that law firm.
Here are a few cardinal principles to keep in mind:
- Wanna keep a social life? => Avoid merger factories;
- Life at European law firms is not necessarily better than in anglo-saxon law firms. This is because there is often a stronger pyramidal hierarchy in traditional (especially south european) law firms. In turn, junior associates are typically less involved in high level issues (meetings with clients, etc.) and must show a lot of deference to senior colleagues. In US law firms, partners – but this is again a generality – would tend to be more approachable;
- US firms pay better than UK firms, which pay better than continental firms. The same equation however applies to billable hours;
- What law firms seek to purchase with a strong paycheck is full availability, including at very short notice. Upon client/partner call, young associates must be ready to sacrifice family, holiday, wedding plans…;
- Minimum entry wage for a 1y associate in a Brussels competition pratice : 50K€/year;
- Like team work? Go for big law. Hate ghost writing? Go for academia;
- The above is of course contingent on the people. Several well-known merger factories are really cool places to work for, simply because the partners there are great professionals and very pleasant persons;
The bottom-line? The talk of the town is that there’s two places where it’s really good to work as a junior associate in Brussels, Sidley Austin and Hogan Lovells (and Garrigues, of course).
Chillin'Competition 