Archive for the ‘Guest bloggers’ Category
An intellectual somersault??
While reading last Friday an article written in a Spanish newspaper by Jesús Alfaro (who, by the way, has sometimes made comments on this blog), I came accross a reference to a Wall Street Journal piece that looked interesting. I checked it and thought that it illustrates pretty well the way in which EU competition law is perceived by many in the US. Check out this excerpt:
“So if you, as an executive, were to be so foolish as to ask your in-house counsel whether a particular action might run afoul of the EU’s increasingly complex and draconian competition regulations, both your question and your lawyer’s answer would become potential evidence against you.
Yet in the sort of intellectual somersault for which European competition law has become notorious, the Court declared that its ruling would not undermine businesses’ rights of defense. That’s because, according to the Court, “the rights of the defence is a fundamental principle of European Union law,” enshrined both in case law and in the Charter of Fundamental Right of the European Union.”
Aside from the fact that the second paragraph does not make much sense, the article reveals a misconception of EU competition law that I´ve observed many times in the recent past, particulalry on the other side of the pond. Antitrust/competition law is admittedly an area where legal certainty is sometimes the exception rather than the norm. However, are there really any reasons why EU competition law could be considered more of an”intellectual somersault” than its US counterpart? I truly don´t see them.
A thought on the Commission´s Air Freight Cartel Decision
As we announced last week , the Commission adopted its decision in the air freight cartel yesterday.
From a policy standpoint there´s one thing that strikes me:
The Commission has fined 11 companies, and all of them (except for Singapore Airlines) have been granted reductions pursuant to the Leniency Notice. At the same time, the Commission has left out of the Decision a significant number of airlines which had been included as addressees of the Statement of Objections. “Coincidentally”, the ones left out are the ones which had not asked for leniency (my guess is that many of them would´ve done it and didn´t because ten other airlines were ahead of them).
In my view there were many reasons for excluding some of the airlines from the decision. I´m also conscious that adopting a decision such as this one with regards to more than 20 companies would have implied a hell of a lot of work. However, and from a policy standpoint, what message does the fact that only leniency appliccants have been sanctioned convey to future potential leniency applicants? Isn´t the Commission shooting its own foot?
(For full disclosure: I participated in the case in representation of a company which is not amongst the ones fined. It´s one of those for whose exclusion there were good reasons).
Guidance (and some other stuff)
The OFT keeps doing interesting stuff. They have now published two concise and useful guidance documents aimed at ensuring compliance by small and medium companies as well as by company directors. (The Spanish CNC also did a good job in releasing guidance for associations not so long ago).
Btw, for those of you who have not yet heard about it, one of the members of the OFT´s Board, Philip Marsden, is the new competition law Professor at the College of Europe, where he´ll be replacing Richard Whish.
Unrelated:
-Rumour has it that next week the Commission will finally announce its long-awaited decision in the air cargo cartel. You can expect truly huge fines.
-Also, yesterday I attended part of the sessions of the FIDE Congress in Madrid, and it was really a privilege to see such an unusual concentration of great legal minds. I could only attend the discussion on competition issues (excellentely chaired by Judge Lenaerts), but I hear that all three panels were of great interest.
Competition Law and Sport (V) FYI
Some days ago I participated together with José Luis Buendía in a conference on sports law held at the UNED (the only state-run Spanish distance-learning university). We covered a wide array of issues concerning the application of competition law in this sector, some of which have also been discussed here in the past (e.g. football tv rights, salary caps, state aids in sports, or the SCOTUS decision in American Needle).
In addition, we talked a bit about two cases on which we´ve worked but about which there is not much information available apart from news clips. I think both cases raise extremely interesting questions, and I believe that some of you may have an interest in knowing about their existence. Accordingly, and as an exception, this post deals with two cases on which I was directly involved (take that as a diclaimer too). I´ll be as objective as I can in exposing the facts:
The first case is currently pending before the Court of Arbitration for Sport, so I won´t say much about it. It relates to a complaint lodged by the Spanish Basketball League against the project to partially close the Euroleague (the basketball equivalent to the Champions League). In the near future the CAS will therefore be ruling on whether the partial closure of a previously open league could restrict competition in any of the many markets in which basketball clubs are active.
The second case, which was recently settled, deals with exactly the same issue as the withdrawn preliminary reference in the Oulmers case, i.e. the right of clubs to be compensated by national federations for the release of their players for international games and tournaments. It was initiated by a complaint lodged by ASOBAL (the Spanish Handball League) before the European Commission in March 2009. The complaint argued that by precluding the payment of a compensation to clubs the regulations governing the release of players restricted competition in a way contrary to both articles 101 and 102 TFEU (in the latter case, it was argued that the resulations were setting “unfair trading conditions”). The Commission took an interest in the case and started a preliminary investigation which was only put to an end pursuant to an agreement between ASOBAL and the European Handball Federation. This case adds up to the settlement between FIFA, UEFA and the European Clubs Association to put an end to Oulmers as one of the most interesting “non-precedents” regarding the application of EU competition law to sport.
New appointments in DG COMP
I believe that we´re the first ones to report the following changes within DG COMP (approved today by the Commission and effective from 1 November):
Nadia Calviño has been appointed Deputy Director General in DG Market. In order to replace her, Cecilio Madero has been appointed Acting Deputy Director General for Antitrust & Mergers.
In addition, Joachim Luecking will be acting as Director of C; Eduardo Martinez will act as Head of C/1; and Gert-Jan Koopman will become Deputy Director General for State aid.
Paul the Octopus dies
This is really (heart)breaking antitrust news. Paul the Octopus died yesterday at the Sea Life Centre in Oberhausen.
This is dramatic news for the competition community: precisely yesterday I saw that the market intelligence company Mlex had very recently referred to Paul as Damien Neven´s replacement (see the great picture above, extracted from the October-December 2010 issue of Mlex magazine).
The aquarium has announced that Paul´s body is in cold storage while decisions are made on “how best to mark his passing”. Paul will be given his own small burial plot and a permanent shrine would be erected in his memory”. For a modest idea from chillingcompetition as to how Paul could better rest in peace, see here
Chillin’Competition celebrates 1st Year
We hadn´t realized, but yesterdat chillingcompetition turned 1 !
It was on October 2oth that we started spreading the word around about the existence of this blog. Nicolas probably knew what to expect after the hotchpotch experience, but I´ve been frankly surprised by the reach of this tool.
Chillingcompetition has had nearly 70.000 visits; its daily visits are currently in the order of 350 (and constantly increasing).
Moreover, its visitors are from very varied places (check the map on the lower right side of the web, right now showing visits from all over Europe, the US, China, Colombia. Kenya, Thailand, Indonesia, Japan, India or Dubai).
We are proud that some people might find the posts here interesting, and we´re committed to improving all the many things that surely can be done better.
Thanks for your trust and interest in our stories!
Nicolas / Alfonso
Satisfaction
In the past both Nicolas and I have resorted to this blog to express our views on the issue of competition lawyers who can get no satisfaction (jobwise) (see here and here). It now seems that U.S. Law Schools are reacting to the perception of lawyers being unhappy by offering their students the chance to study this phenomenon in depth with a view to coming up with some sensible solutions.
Those are good news. There are many of us who, although enjoying what we do (or precisely because of this), believe that many things could be done differently and better within the legal profession. The best lawyers deserve better. In the long term, outstanding legal skills and excellent client service can only be offered by satisfied lawyers. Otherwise, our profession risks losing new generations of not so short-sighted and highly skilled lawyers.
OFT and Competition Commission to merge
There had been rumours about it in the past few weeks, but it now appears to be confirmed: the Office of Fair Trading and the Competition Commission will be merging as part of the British coalition government´s plan to cut costs (the monopoly in the enforcement of the competition rules is justified on the basis of its alleged efficiencies).
Despite its apparent complexity and notwithstanding certain duplication of tasks between the two agencies, the British enforcement system has until now worked extremely well. According to press reports, some regard this move as a negative one, fearing that it will endanger the reputation of the system. I (obviously not an expert on British competition law ) see no major objections to it. Does anyone have strong feelings about it?
Unrelated: I´ve just learnt via a communication from the ABA that you run the risk of being disbarred if you charge $3.500/hour fees, call a court clerk a “f…. bitch” and suggest that the judge in front of you is a pedophile. I suppose we´ll all have to adapt and change our argumentative techniques..
A French poll, non-profit-maximizing behavior and tacit collusion
A poll that appeared last Friday on Le Monde offers some interesting data regarding issues that have attracted our attention in the past.
The poll´s main finding is that 71% of French consumers would not switch to a competing internet provider in the event of a price increase. This further confirms that, as priorly discussed here, assuming profit-maximizing behavior on the part of consumers -although perhaps inevitable and irreplaceable as a proxy – is a hell of an assumption.
28% of those who would not switch in response to the hypothetical price increase in the order of 2-3 euros a month seem not to perceive such increase as a big change. These consumers could be regarded as the per se inelastic part of demand.
If I refer to per se inelasticity it’s because it seems that there´s a greater source of inelasticity derived from consumers expectations with regards to the parallel behavior of competitors: 38% of those who would not switch argue that switching would be pointless given that all undertakings would simultaneously increase their prices too. Interestingly, past experiences of conscious parallelism could thereby be enhancing the rigidity of the market and the individual market power of certain undertakings.
The data reflects a, certainly justified, disbelief on the part of consumers regarding competition law’s ability to face the oligopoly problem (see here for a controversial exception). A chap you might know has written a bit on this topic.
(Thanks to Napoleón Ruiz for the pointer!)
Chillin'Competition 
