Archive for the ‘Other interesting papers’ Category
Much more on the Intel Judgment
Writing about the Intel Judgment seems to have become one of the favorite hobbies of some of our leading competition law experts.
One of the most downloaded and talked-about competition law articles of the year was Wouter Wils‘ one on “The Judgment of the EU General Court in Intel and the So-Called “More Economic Approach” to Abuse of Dominance“, which we discussed and first announced here.
Wouter’s piece was followed by other equally interesting ones, like Richard Whish‘s (see here), and like my current co-blogger’s, which also received considerable attention (see here for Pablo Ibañez‘s “Intel and Article 102 TFEU Case Law: Making Sense of a Perpetual Controversy” [Wouter’s and Pablo’s articles are by the way both nominated for the Antitrust Writing Awards (see the “Dominance” category here); for some reason Pablo is also co-nominated in the business category for two other pieces I wrote myself (I now understand why he likes to theorize about free riding… 😉 ]
The latest addition to this list of worthy reading is a paper just made available by our friend and founder of this blog, Nicolas Petit. His piece, titled, Intel, Leveraging Rebates and the Goals of Article 102 TFEU discusses the positive law standard applicable to exclusivity rebates following Intel. He finds that the GC’s Judgment sets a modified per se prohibition rule for exclusivity rebates, and endorses the theory of anticompetitive leveraging that formed the core of the Commission’s Guidance Paper on Article 102 TFEU. Nicolas also discusses the purposivist debate that has arisen in the scholarship, and whether it is right that the General Court endorsed a non-welfarist approach to Article 102 TFEU. In his view, this cannot be right, for non welfarist goals cannot be acclimated in moden competition law. Nicolas calls for clear dicta from the ECJ along the lines of Post Danmark.
Those interested in knowing even more (or, rather, in having even more mixed views) about the Intel case should (1) have attended Nick Banasevic’s (who was Case Manager in Intel) excellent talk about the Judgment last Friday in Madrid; and (2) take a look at a new competition law journal (Competition Law & Policy Debate) which, in its first number, features a bunch of Intel-related articles authored by a very impressive line-up of authors (the same issue includes as well an interesting piece on the Google case by the former President of the CFI, Bo Vesterdorf, also available in SSRN).
P.S. Following the publication of this post I have received another piece on the Judgment. This one is authored by Luc Peeperkorn -a European Commission official and one of the main proponents of the effects-based approach, currently on a one-year leave of absence at NYU-, and its title is self-explanatory: “Why the General Court is wrong in Intel and what the Court of Justice can do to rebalance the assessment of rebates“. The piece is also interesting, and unusual, for it is not every day that a Commission official criticizes (although in an academic capacity) a Judgment that the Institution won in first instance and is defending on appeal.
Non-working papers (on two-sided markets, object/effect, cartel evidence and Google)
I recently had to devote most of my non-billable work to finishing a few publications (the fact that after a few missed deadlines I was almost under death threat from editors also played a role) and preparing some courses. As if there weren’t better things to do with one’s time…
Anyway, since I did the work, I thought that it could perhaps be useful to post it or refer to it here, both to justify myself and in case any of you might find them interesting or have comments. These “non-working” papers include:
– A paper on “The Double Duality of Two-Sided Markets” which, to a large extent, is a beefed up version of my speech (the ppp is available here) at the Swedish Competition Authority’s Pros and Cons Conference back in November. The editors of Competition Law Journal have kindly offered to publish it, so it will appear there soon. The paper posits that competition law enforcement regarding multi-sided platforms may have not always accounted for the ambiguity of business practices carried out in these settings and attempts to identify the causes at the root of this problem and to propose some solutions. In essence, my take is that multi-sided platforms raise old questions but with renewed intensity, and that this must force us to go back to basics and recall some general principles that we should never lose sight of.
– A presentation on the Cartes Bancaires Judgment (here: Some additional reflections on Cartes Bancaires_Lamadrid ). It’s titled “some additional reflections” because it followed previous interventions at a seminar on the part of Javier Ruiz Calzado (Latham&Watkins; his very good ppp is also available here: Cartes Bancaires_Ruiz Calzado ) and Nicholas Khan, from the European Commission’s Legal Service. It was a privilege to share the panel with them.
– An absurdly lengthy not so succint paper I’ve co-written with my colleague Ana Balcells on cartel evidence in Spain: La prueba de los cárteles en España (Lamadrid_Balcells), forthcoming in JM Beneyto y J Maillo (Dirs): La lucha contra los cárteles en España, Aranzadi, 2015.
– Also, a few days ago the founder of this blog, Nicolas Petit, asked me (with a most kind anticipation of less than 24 hours…) to conduct a case study on the Google investigation at the Brussels School of Competition. It was a very interesting exercise. I only directed the debate asking questions and linking issues together and it was the students who brilliantly taught themselves and arrived to their own conclusions (I’m being nice to them because I told them that suscribing to the blog is a prerequisite for passing, so I assume they’re reading this). The legal issues underpinning the case (which have not always received the necessary attention) are very well-suited to reflect about some basic concepts of Article 102. In fact, Pablo also did this with his students at LSE a few days ago. Just in case any of you is interested in conducting a similar exercise, here is the (very hastily drafted) list of questions I used: Google Case study – BSC_Lamadrid.
Antitrust Writing Awards 2015
Concurrences has launched the 2015 edition of the Antitrust Writing Awards.
Among the roughly 50 articles selected for each of the “academic” and “business” categories there are many written by friends of this blog, and also some authored by Pablo (namely this one), Nicolas Petit (see here) and myself (here and here) (btw, if you click on any of those you might as well give us a 5 star vote 😉 )
Regardless of the degree of importance that you may give to these things, scrolling through the list of selected articles is a great way of catching up with some of the best scholarship of the past few months (and also with our writings). Being the sort of person that reads a competition law blog, you’ll surely find some stuff of interest in those lists.
P.S. An additional thought: I just saw once again the pic of Pablo that appears in the Concurrences website (at one point in time he was the most read author in that site) and couldn’t help thinking that it’s well suited for a before-and-after Men’s Health cover…
International Conference on Cartels- Materials
The Universidad San Pablo CEU (which thanks to the work of Prof. Jerónimo Maillo has always paid an unusual attention to competition law) and the Spanish Competition Authority recently held an international workshop on Cartels in Madrid which I hear was a great success.
I couldn’t make it, but I’m told that my colleague Konstantin Jörgens did a great job discussing a piece I’ve co-written on the assessment of evidence in cartel cases.
All materials are now available at the website of USP-CEU’s Institute for European Studies , but since we know you’re a bit lazy (no offence) we’ll save you the effort of an additional click:
- Opening Speech
Eduardo Prieto
Download pdf - Integrating Regulatory and Antitrust Powers
Juan Delgado
Download pdf - Calculating fines: Practical problems
Alberto Escudero
Download pdf - Lessons from the Damages’claims in the Spanish sugar cartel
Francisco Marcos
Download pdf - EU Antitrust Damages
Evelyne Ameye
Download pdf - European Commission’s settlement procedure – a success story
Eric Van Ginderachter
Download pdf - Leniency programmes and the problematic use of confidential information
Javier Guillen
Download pdf - An economic assessment of the judicial review of the CNMC’s fines
Javier García-Verdugo
Download pdf - Cartel Settlements
Jean-François Bellis
Download pdf - Leniency and Cartel Detection
Juliane Schulze
Download pdf - Sanctioning hard core cartel infringements in EU Competition Law: towards a more compliance-driven approach
Aaron Khan
Download pdf - Fines and Evidence in Cartels
Konstantin Jörgens
Download pdf - Prosecutorial & Non-Prosecutorial Systems and the Fight against Cartels
Marianela Lopez-Galdos
Download pdf - Leniency – Dutch experience
Pablo Amador Sánchez
Download pdf - ‘How (Not) to Design a Criminal Cartel Offence: Learning from the UK Experience’
Peter Whelan
Download pdf - Swedish Competition Authority
Karin Montelius
Download pdf - EU Judicial Architecture Facing Anti-Cartel Enforcement
Georges Vallindas
Download pdf - Leniency Plus: a Building Block or a Trojan Horse?
Marek Martyniszyn
Download pdf - Class Actions to Claim Antitrust Damages
Pablo Gutiérrez de Cabiedes
Download pdf
European Commission’s literature
Having to spend a couple of quieter than usual days sick at home, I decided to catch up and so some summer reading on some recent European Commission’s publications.
As you know, DG Comp is quite prolific from a literary viewpoint (I’m not saying that this is because anyone there may have free time). Aside from an extraordinary number of soft law instruments it has also tried new genders, such as show-off comics, and regularly issues other seldomly read stuff.
A first point to be made –and oddly enough I’ve just realized about it- is that the Competition Policy Newsletter has disappeared for good. I don’t know what has led to its termination, but it’s a pity; the articles featured in it often offered interesting insights on how some cases were viewed from the inside. The publication has been replaced by the Competition Policy Brief, which mainly deals with policy issues; not really the same concept.
A great candidate for an article on the Competition Policy Newsletter would have been the case on spare pieces of luxury watches shelved yesterday by the Commission, which did not find an infringement. This marked the first and only time that the Commission has used the claw-back clause provided for in Article 11(6) of Regulation 1; it took the case from a national competition authority (the Spanish) that was on the verge of sanctioning it and now it has concluded that there is no infringement. [For advertising disclosure purposes: we were active in both the national and EU phases of the case representing a number of the companies investigated].
I’ve also done some catching up on actual decisions. We keep on complaining that the Commission adopts fewer infringement (Art 7) decisions in non-cartel cases than it should and that we lack guidance, but then very few people read the scarce ones there are. How many people have, for instance, read Telefónica/Portugal Telecom, which raises very interesting and never discussed points on the self-assessment of restrictive agreements? The very recently published Motorola decision is also an interesting read for those geeky enough.
Then I skimmed trough the latest set of documents published by DG Comp in relation to the 10th anniversary of Regulation 1/2003, namely the Communication on Ten Years of Antitrust Enforcement under Regulation 1/2003: Achievements and Future Perspectives and the accompanying Staff Working Documents (here and here) Aside from interesting stats on enforcement, these documents contain a cautionary discussion on institutional issues related to national competition authorities (in relation, mainly, to their independence vis à vis political authorities, the necessary appointment of members of the authority on the basis of merit, “amalgamation of competences” risking “a weakening of competition enforcement”). I wonder if they had any specific NCA in mind… Some of the understatements in these papers make evident a couple of problems; for instance, when the Commission says that the “mechanism by which the Commission is informed of national courts judgments (…) has not worked optimally”, what it means to say is that national courts have completely ignored this mechanism in practice.
But what those documents are mainly about –and they’re right on point- is in identifying procedural divergences across Member States as the next obstacle to tackle. This is a recurrent issue on which I’ve insisted every time I had the chance (both in lectures and papers like this one –the others are in Spanish-). At the present moment, and due to the principle of procedural autonomy, very significant differences remain regarding, for instance, inspection powers, discretion to take on cases, powers to impose structural remedies, regulation of commitment decisions, leniency rules, existence of cartel settlements, procedural rights and calculation of fines. This leads to the result that the application of the same –EU competition- rules is very likely to lead to very different outcomes depending on the authority dealing with the case (and rules on jurisdiction often make it difficult to predict who that would be). To me, this is legally the big, fat, painted elephant in the EU competition enforcement room (hence the pic –taken at a Banksy show- at the top of the post)
Lastly, I also read a few speeches by high officials at DG COMP. In preparation for a paper which will touch a bit on commitment decisions and on the technology sector, I read a speech by Vice President Almunia on commitment and settlement decisions in which –this grabbed my attention- he referred to the e-books case explaining that the Commission “accepted commitments in a nascent and extremely dynamic market which called for quick and decisive action”. Why is that so, you may ask. The response is contained in para. 90 of the Staff document on the 10 years of Regulation 1 referred to above: at the beginning of a special section on IT, Internet & Consumer Electronics, the Commission states that “these are industries characterized with strong network efforts [it seems quite likely that they meant to say effects, not efforts] which enable the lock-in of customers and further strengthening of dominant positions. Vigilance on the part of competition authorities is thus warranted”. So, we’re told that nascent and extremely dynamic markets call for quick and decisive action because of the risks generated by network effects. The thing is that I sort of recall having read something different somewhere…
Recent output
In the course of his time off blogging, Nicolas has remained pretty productive on the academic front. Here are the abstracts and links to some of his latest work:
1. A sequel to the World Cup, with a short paper on the UEFA Financial Fair Play Regulation. In brief, he expressess doubts that the FFPR recently introduced by UEFA will promote competition in the football industry. According to Nico’s view, the FFPR is likely to create an ‘oligopoleague’ of football clubs that will freeze the market structure, to the detriment of the smallest clubs. The conclusion is that the FFPR may well constitute an unlawful agreement under Article 101 TFEU. The paper can be downloaded here.
2. A paper arguing that the TeliaSonera judgment on price squeezes has been in part repealled by subsequent case-law. The paper resorts to a short numerical example to show the flaw of finding a price squeeze in the presence of positive margins. The final version of this paper was published in the “Revue du Droit des Industries de Réseaux“, a new journal on the regulation network industries. See here: Price Squeezes with Positive Margins – Economic and Legal Anatomy of a Zombie (Final)
3. A presentation on the General Court’s Judgment in Intel, where he argueS that the Guidance Paper is not yet dead. In his view, the impact of Intel is confined to leveraging rebates – ie retroactive rebates – which are subject to a quasi per se illegality standard. As for the other rebates – eg incremental rebates – they remain subject to a rule of reason standard, though the assessment method need not be quantitative. The General Court also has generalized the Article 102(3) defense in abuse of dominance cases, though it is complex to see if this will be practical. The paper concludes with an optimistic note on the future of the Guidance Paper, and discusses the more philosophical point of whether Article 102 should seek to protect competitive OUTCOMEs or rather the PROCESS of competition. Nicolas submits that if 102 protects the PROCESS of competition, this should not dispense agencies and complainants to bring a certain degree of economic evidence in support of their allegations. See here: Intel v Commission – ABC Seminar – 10 07 14
4. A presentation on “Problem Practices”, ie practices that do not fall neatly within the conventional antitrust prohibitions: planned obsolescence strategies, most unfavored customer clauses, IP tracking- pricing, etc. He gave a speech on this at the CCP (University of East Anglia) Annual conference on Problem Markets arguing that existing EU rules can be flexibly stretched to capture such practices, and that we do not need a Section 5-type provision in our legal framework. In other words, he submits that there is no gap within the EU competition toolbox. See here: Problem Practices – CCP
5. A presentation on the principles of effectiveness and procedural autonomy in EU competition law given before an audience of judges at EUI as part of a seminar hosted by Giorgio Monti. See here: The Principles of Equivalence and Effectiveness -Petit
Nicolas is currently writing papers developing the content of presentations 3 and 4, so he’ll be grateful to anyone interested in sharing thoughts on those.
More on the antitrust-privacy interface
In some previous posts we’ve commented on the interface between the competition rules and data protection/privacy regulation, which is one of the trendiest topics in international antitrust these days.
As you may recall, the European Data Protection Supervisor recently held a high level workshop (high level but for my intervention on it, that is) on Privacy, Competition, Consumers and Big Data. On Monday, the EDPS made available on its website a report summarizing what was discussed in the workshop (conducted under Chatham House rules). The EDPS’ summary is available here: EDPS Report_Privacy, competition, consumers and big data.
A summary of my intervention at the workshop was published in two recent posts (here and here).
For more, you can re-read Orla Lynskey’s A Brave New World: The Potential Intersection of Competition Law and Data Protection Regulation as well as the interesting comment by Angela Daly on my latest post on the issue.
The German Monopolkommission has also addedd its voice to the debate by issuing a recent report (“A competitive order for the financial markets“) which contains a section on data-related questions regarding the internet economy. The Press Release (in English here) expressess some concerns but notes that, according to the report, “an extension of the competition policy toolkit does not (yet) seem advisable on the basis of current knowledge and understanding“.
‘Stealth Licensing’ – Are Antitrust Law and Trade Regulation Squeezing Patent Rights ?
Monsieur le Professeur Nicolas Petit has just published a piece titled “Stealth Licensing”- Or Antitrust Law and Trade Regulation Squeezing Patent Rights. In this paper he illustrates his points by resorting to metaphors on black swans and butterflys (read the last sentence in the 3rd paragraph below), which is a good indication that he may well have definetely lost it 😉
In Nico’s view (and from now I’m pasting the paper’s abstract): a “stealth licensing” paradigm is emerging across the globe. It can be seen through subtle interventions from policy makers, judicial organs and administrative agencies. Those interventions seek to facilitate compulsory licenses outside the TRIPS agreement exceptions and/or to water down those exceptions. Altogether, they ramp up pressure on patent owners to give away their freedom – it is actually a “right” – to exploit their innovations as they see fit. The paper submits that stealth licensing is a significant phenomenon that adversely impacts the social welfare functions of the patent system. It risks undermining investment in technology, technology creation and the dissemination functions of the patent system at a critical juncture in time, as new critical technologies like green technology, the internet of things, machine to machine technology, smart medical devices or biotechnologies are being called for, and rolled out, across the globe. Moreover, stealth licensing is occurring despite the fact that both private and public investment in R&D is critical to help developed economies back on the path to growth, competitiveness, employment and prosperity.
This paper the concept and policy of “stealth licensing”. To that end, it first surveys the literature on the social functions of the patent system, and in particular, on the role of patents to incentivise (risky) R&D efforts and to disseminate successful technological innovations (I). In this context, it recalls that whilst divided on the exact function of patent law, scholars broadly concur that patents have social utility. The paper then shows the emergence a “stealth licensing” paradigm adversary to the social functions of the patent system. To aid understanding, it starts with a definition of the concept of “stealth licensing” (II). It then describes its emergence in international trade regulation where a “flexible” interpretation of the TRIPS compulsory licensing exceptions is making way (III); and in antitrust law, where a distinct though equally problematic “undercover” licensing paradigm is gaining prominence (IV). Finally, it explains the perils of squeezing patent rights through stealth licensing with two metaphors: that of a black swan (V) and that of a butterfly (VI).
Supermarket power
Some of the tastiest issues in current competition law arise in the food sector. In fact, as you’ll see in a second, some of those issues are the same ones that we often face in other dynamic two-sided markets that generally attract more public attention.
At Chillin’Competition we’ve always paid our fair share of attention to food distribution and groceries (in fact our first posts on endives still ranks among out most read ever (actually, when you search for Chilling Competition on Google the word endives appears immediately in the autocomplete box, which may seem a bit odd). Today, we’re happy to include a “sponsored link” to the work done on this subject by a good friend of ours.
Javier Berasategi (former lawyer at Stanbrook in Brussels, former President of the Basque Competition Authority –yes, there is one-, surfer, runner, alpinist and overall a quite unique guy now running a solo legal practice) has authored an also quite unique work on supermarket power. As always, it’s original, thought provoking and perhaps a bit controversial.
But regardless of whether one agrees or not with the analysis and the suggestions in it, its approach is certainly interesting; here’s the abstract:
“This paper analyses the sources of supermarket power vis-à-vis shoppers and independent brands. This power transforms leading supermarkets into vertically-integrated competitive bottlenecks that are able to restrict competition between brands (including their own ones) and reduce consumer welfare. However, competition enforcement has failed to address their bottleneck role and the negative consequences of their practices on dynamic competition (i.e., a market where the competitive process fosters innovation, quality and variety), the ultimate goal of competition policy. This paper proposes complementary regulatory and competition remedies to ensure that access to supermarket platforms and competition within them promotes fair dealing, consumer welfare and economic growth. It draws inspiration from the remedies enforced in other competitive bottlenecks such as CRSs, mobile communication networks, internet service providers, internet search engines and credit card networks”.
[It’s interesting that the paper brings together groceries and tech stuff, particularly following Nicolas Sarkozy’s cautionary words about the perils of comparing endives to Apple (see here). Although, to be fair, Kevin Coates had done a similar link before with his “exploding banana hypothesis” (I’m saying this to force him to explain it on 21st Century Competition …)].
The report, titled Supermarket Power: Serving Consumers or Harming Competition, is available here Take a look, it’s only slightly above 350 pages.
Further work on this subject will also be made available through a new website: http://www.supermarketpower.eu/en/
P.S. The picture may be subject to copyright, but I deserve full credit for having found an image of a supermarket actually called power.
Antitrust and Tech Seminar Materials
A few days ago I participated at a very interesting AIJA seminar in Bruges on Antitrust and Technology. All panel discussions were great, but I’m particularly grateful to Pablo Ibañez (LSE) and Kevin Coates (DG Comp) for their participation in the panel I moderated on interoperability issues, which was truly excellent (and not because of me).
The presentations projected at the conference have been made available at AIJA’s website (I include the hyperlinks below for your convenience):
- Technology Licensing and the New TTBER
Dominic Muyldermans – Exclusion of termination for challenge of IP
Olivier Sasserath – Exclusion of the exclusive grant-back obligations
Anna Vernet – update after public consultation
Stefan Vollering – Big Change on a Minor Issue
- Keynote speech – With great power comes great responsibility
Dr Philip Marsden – With great power comes great responsibility
- Caught in the antitrust web -Regulating internet services
Gerardo Faundez – Travel as evolving market
Thomas Graf – The EU Google Investigation
Silke Hossenfelder – German Antitrust Cases in the Internet Economy
Sebastian Jungermann – Regulating internet services
- Patent litigation and settlements -The limits of settlements and Pay-for-delay
Tamar Dolev-Green – Pay-for-delay
Kyriakos Fountoukakos – Patent litigation settlements
Simone Gambuto – latanoprost-pfizer saga in Italy
- Patent strategies and abuse of dominance What are the antitrust boundaries
Miguel Rato and Nicolas Petit – Abuse in Technology Enabled Markets
Maria Troberg – Patent Strategies and abuse of Dominance
Jan Peter Van der Veer – An economic perspective on patent strategies
- Competition law and interoperability
Pablo Ibanez Colomo – Interoperability issues under EU Competition Law
Alfonso Lamadrid – Interoperability
(Image quite possibly subject to copyright)
Chillin'Competition 