Author Archive
For Whom the Bell Tolls
This is what happened to my computer tonight … The blue screen of death, as most IT geeks name it… Very scary…
Quote of the Day
“Price mechanisms must be put in place to correct the market when it proves incapable of setting a socially acceptable energy price, while allowing private operators to make necessary investments in the network“.
And a question: at what level does a price become socially unacceptable?
My gut feeling: when the market fails to serve all those customers whose reservation price is superior to the producers’ costs. But I suspect the author of this quote to envision something else.
Found in J. DELORS’ foreword to “Towards a European Energy Community: A Policy Proposal” drafted by Sami ANDOURA, Leigh HANCHER and Marc VAN DER WOUDE. Congratulations to them for putting together such a creative, and potentially controversial, policy report. The text of the report can be found hereafter.
(Image possibly subject to copyright: source here )
State Aid and General Interest
Julien de Beys (invited lecturer at the University of Louvain) has posted here a freely downloadable version of his Phd on State aid and General Interest (in French). The good, refreshing thing about this work is that it takes a rather original perspective on State aid. Unlike most other authors, who start from the idea that State aid is genuinely distortive, this research starts from the other side, and seems to argue that State aid is generally necessary to ensure general interest. Obviously, hardcore free-marketers, who believe that the accumulation of egoistic self-interest is the sole drivers of collectively optimal outcomes, will find this work particularly controversial. I paste hereafter the abstract, and wish to congratulate the author for his impressive piece of work.
The present thesis analyses the State aid control carried out by the European Commission as regards the concept of general interest. In doing so, this research contributes, on one hand, to situate the current position of this concept within EU law, as well as, on the other, it underlines the profound developments this control inflicts on the Member States’ economic intervention policies. Any person interested in State aid law knows that, in one way or another, State aid is deemed compatible with the single market because it benefits to society, namely because it allows the realisation of general interest objectives. Consequently, if general interest is at stake, what are the legal bases used in order to express it? What are the references of the Commission and how does it nourish its reflection? How come that the European Parliament and the Council appear to be apart? How are national interest and European interest articulated? In addition, Member States today have to justify to what extent their economic interventions are preferable to the free market and put them in the prolongation of the objectives sought at the European level. The necessity of this national policies’ orientation is not questioned. However, Member States should collectively find at European level the room for manoeuvre that they individually lose at national level. The first part of the thesis analyses the scope of State aid control. Why a general ban of State aid? Why are certain exemptions accepted? The second part describes the method by which certain general interest objectives are recognised. It specifies that these objectives are also “configured”, according to an original concept identified by the author. The third part shows that State aid control constitutes a national interest control at the service of the European policies. An important exception to this statement is however examined: the Member States’ competence to determine, set up and finance their public services.
(Image possibly subject to copyrights: source here)
Back to the Front
Back from Moscow, an absolutely awesome place.
A number of puzzling things though:
- The density of Porsche, Lamborghinis and other sports cars is far higher than in rich western European countries;
- Prices for consumer goods are not lower than in western European countries;
- Most shops are opened overnight;
- Most dairy goods are imported from the West. In fact, besides Oil and Gas, Russia seems to be very dependent on imports from other economies. This is strange though, and I wonder why Russia keeps importing basic goods, incorporating little technology, rather than developping local production.
- Traffic in Moscow is horrendous. Their metro network, which dates back from Staline, has nothing to envy to the dirty London tube, or to the old Paris metro.
Now, besides this, a number of hot, burning news:
- Registration for the IEJE’s Conference on the Reform of the New Framework for Electronic Communications is still open. The Conference will take place on 30 April. See here for more.
- The 44th Lunch Talk of the GCLC, entitled “The Lisbon Treaty and the Future of EU Competition Policy”, will take place on 28 April at the Marriott Hotel in Brussels. Hereafter, the registration form Registration Form – 44th GCLC Lunch Talk – 28 April 2010
- Antoine Masson received the Montesquieu Prize for the book he edited last year on the Legal Aspects of Firms’ Business Strategies. Congratulations!
(Image possibly subject to copyrights: source here)
Closed
I will be away most of next week with only sporadic access to the Internet. Normal posting activity on Chillin’Competition will resume as of 12 April. Meanwhile, Alfonso will certainly drop a few lines on this blog.
1 April
For all antitrust geeks: read the American Antitrust Institute 1 April column (pasted in full below). Simply hilarious.
AMERICAN ANTITRUST INSTITUTE LAUNCHES THE ANTITRUST CHANNEL |
| FOR IMMEDIATE RELEASE CONTACT: Bert Foer April 1, 2010 (202) 276-6002 bfoer@antitrustinstitute.org WASHINGTON, DC –
In a major breakthrough for cable television, the American Antitrust Institute (AAI) today announced that it has purchased the Golf II Channel from Comcast/NBC and will immediately convert it to The Antitrust Channel, airing antitrust news and events 24/7. AAI President Albert A. Foer refused to disclose the amount the AAI paid for the Golf Channel. He promised that The Antitrust Channel will not dismiss any reasonably plausible antitrust views, although this would exclude those of the Chicago School. Foer reported that content development is well underway and provided examples of the kind of programming that will be aired on the new channel:
In a move clearly aimed at expanding the public’s interest in the new channel, the AAI invites viewers to send additional ideas to aai@antitrustinstitute.org. Look for The Antitrust Channel on the cable monopoly in your area. If it is not being offered, call the FCC to complain and send a copy of your complaint to the AAI. ### About the American Antitrust Institute The American Antitrust Institute is an independent non-profit education, research and advocacy organization. Since its formation in 1998, the AAI’s mission has been to increase the role of competition, assure that competition works in the interests of consumers, and challenge abuses of concentrated economic power in the American and world economy. To learn more about the AAI, please visit www.antitrustinstitute.org. Because previous April 1 columns have been reported verbatim by the media as news, our attorneys have advised us that these columns should be accompanied by a disclaimer. We have rejected this advice. (Image possibly subject to copyrights: source here)
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Duty to deal
Yesterday, Ofcom (the UK electronic communications regulators), decided to force Sky Sports to offer its TV packages Sports 1 and 2 to other TV retailers – for example, cable, terrestrial and IPTV – at a wholesale price set by Ofcom.
No doubt this decision will trigger massive controversy, in an area where exclusivity has long been hailed as THE sole efficient business model. I can certainly see an “output enhancing” effect on users (increased availability to customers). The remedy may thus be good in terms of allocative efficiency. In addition, one can anticipate a downward effect on prices for the acquisition of sports rights. Purchasers will bid lower, for fear of having to share their sports rights later.
My gut feeling: in light of the obscene amounts lately paid by TV channels for sports rights, and of the possibly detrimental snow-ball effects this may have in the long term on sports clubs, Ofcom’s decision does not look too bad.
Thanks to E. Provost for the pointer.
I chose the picture as a reference to the famous Aspen Skiing case.
(Image possibly subject to copyrights: source here)
PS: I am told by a good friend, Chris Brown, that “OFCOM has not in this decision imposed a duty to deal. Sky already dealt with rivals, including Virgin Media (the subject of a previous dispute), so you can already watch Sky Sports on platforms other than Sky’s; what OFCOM has forced Sky to do in this decision is to reduce the wholesale price it charges to Virgin and others by roughly 25%“.
Penguin Dinner 2
This really addictive game will learn you how to allocate scarce resources efficiently, how to make economies of scale, and how to increase labour productivity.
Beware, your own productivity might in turn decrease dramatically. Found on the hilarious blog optimum (in French).
A question to our readers
For weeks now, I have unsucessfully been looking for a specialist of horizontal cooperation agreements under EU competition law.
Could someone help? I need to find a person able to deal with the various types of cooperation agreements.
You can throw names as comments to this post, or if you want full confidentiality, email me at nicolas.petit@ulg.ac.be. I would be immensely grateful for some help.
Chillin'Competition 
