Chillin'Competition

This 9th edition of the Friday Slot features an interview with Damien Geradin (Covington & Burling, TILEC). I owe a lot to Damien. If Alfonso ever did me the honour to invite me on the Friday Slot, I would explain that Damien is the one who really got me into competition law. We met at the College of Europe, where I was his student. Came the end of the year, he offered me a research assistant position in Liege. I took it, and he then taught me how to write, introduced me to the more economic approach of EU competition law and taught me that all established truths – and in particular legal principles – deserve to be discussed. I will never be grateful enough for all the things he brought me. More generally, in the competition community, Damien is known for his many powerful papers on abuse of dominance law. He is also amongst the very few EU law scholars who managed to obtain a teaching position in a US university, and to reach position 40 in the ssrn ranking of top authors for law. We are immensely happy to publish his interview today.  

“Oscar” of the best competition law book?  And of the best non-competition law book?

I have never really used any competition law book (as when I am looking for a piece of information, I am rather trying to find the relevant law review article), so it is a hard question to answer.  The Antitrust Paradox of Robert Bork was certainly very influential and a good read, but it was flatly wrong on some points.

Mémoires d’Hadrien by Marguerite Yourcenar is a fabulous historical novel, which I read when I was a teenager. Since then, I have read very many books, but none exceeded the level of perfection and erudition of that book. Albert Speer’s memoir Inside the Third Reich is also a book that needs to be read (as it explains how the unthinkable happened), although I regretted that Speer did not express stronger regrets for his actions.

“Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development?

Although this is not a case-law development, I think that the Commission did a fine job with the guidelines on horizontal cooperation agreements. The Commission managed to find a good balance on some complex and sensitive issues.

As to the worst case-law development, the ECJ judgment in TeliaSonera is a terrible piece of work. It will be hard to explain to future generation of students why margin squeeze is conceptually different from refusal to supply, and why the condition of essentiality that must be met in refusal to supply cases doesn’t apply to margin squeeze cases. This leads to patently absurd results.

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?

1. I would split investigative and decision-making functions in EU competition cases. No one would create enforcement agency combining such functions today. There is a large consensus among scholars and practitioners that such a reform is needed even if it is resisted by the Commission. How this should be done in practice is subject to discussion and various modalities could be envisaged. But the principle that no authority should combine investigative and decision-making functions is fundamental.

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For this eighth edition of the Friday Slot, Chillin’Competition has interviewed Johan Ysewyn (Covington). Our readers willing to improve their presentation skills should once attend Johan’s seminar on cartel law at the Brussels School of Competition (BSC). With his partner in crime Ewoud Sakkers, they have managed to craft a real attractive seminar which combines high-level competition law teaching with role-playing. Both instructive and hilarious. And each year, the students’ evaluation reach sky-high levels. All of this to just say that the powerful and humourous Johan denotes within the grey world of the legal community. We are immensely proud to have him on this slot. Enjoy!

PS: In a gesture of solidarity with our fellow Spanish professor who got sued for defamation on his blog, Chillin’Competition will be closed next week. This decision has nothing to do with the fact that Alfonso will be away in Croatia with ‘Ms Lamadrid’ nor with the fact that I will be skiing in France.

“Oscar” of the best competition law book?  And of the best non-competition law book?

The Oscar for the best competition law research book still goes to Korah’s yellow book.    I kept my edition from my College of Europe days and although the last edition dates back to 2007, it still is a great – and to the point – introduction to the competition law field.   Judge Bork’s “The Antitrust Paradox“, has been mentioned already by a number of my co-Friday slotters and remains an essential read.   The idea that antitrust laws should be about protecting competition rather than competitors seems to be still a novel concept for a number of competition authorities.

A more fun competition-book is Christopher Mason’s “The Art of the Steal” which gives the background and history to the Christie’s/Sotheby’s cartel and is really a good “thriller”-type read.   Highly recommended.

On the non-competition side, I have started reading some of the French modern literature.  Jonathan Littell’s “Les Bienveillantes” is simply a must-read in dealing with the darkest period of the 20^th century.  Am also a big fan of Amélie Nothomb, especially where she describes the cultural clash between East and West.   “Stupeur et tremblements” is an essential read for those of you who have Japanese clients.  A friend recommended me Michel Houellebecq – La Carte et le territoire – but haven’t got beyond the first 20 pages yet.

“Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development?

Oscar of the best case-law development: All of the cartel judgments of the last year where the Commission is being criticised for misreading/misinterpreting the evidence.   Finally.

Oscar for the worst case-law development: Pfleiderer.  Commission now needs to legislate to avoid leniency statements being disclosed, something which strikes me as a no brainer.

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?

• Find a comity-rule for multi-jurisdictional merger filings.  What a waste of time and money.   Good for law firms but the benefit of having 20 countries or more looking at a merger – where some of them only have a tangential interest escapes me;
• Reinforce internal checks and balances within DG Comp.  They have been slipping on that.   And yes, I know we’d all look to split the decisional and the investigatory layer but I am a realist;
• More judges in the GC, resulting in speedier appeals.

Average working time/week?

I have realized that hours in the office and efficiency don’t necessarily match up.

Why do you work in competition law? How did you first get into it?

As many people from my generation, I started off doing a lot of general EU-type work as well as commercial work.   There was the Internal market push by Delors – 1992 remember – and there was lots of advisory work on distribution contracts and the like.   But things were changing.  The  Merger Regulation had just entered into force and national authorities were being set up all over Europe.   So there was simply more competition work to do.

And yes, I enjoy it too.   Saying that it combines law, economics and policy is so cliché – but it is true.

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This seventh edition of The Friday Slot features an interview with Maurits Dolmans (Cleary Gottlieb). Most of us are aware of his tremendous reputation as a leading antitrust lawyer, but his answers to our questionnaire will reveal facets of his personality and of his life that, until now, remained mostly unknown. It’s a privilege for us to publish Maurits’ bright and most interesting answers. Enjoy!

“Oscar” of the best competition law book?  And of the best non-competition law book?

I do not read competition law books;  I just use them as reference.  A truly memorable “legal” book is Natural Justice by Ken Binmore, with fascinating game theory showing how, for all our competitive spirit, justice and fairness are innate in the human existence – a comforting thought in a turbulent world.

My non-legal favourites are probably Robertson Davies’ Deptford trilogy (The Manticore) and Cornish trilogy (What’s Bred in the Bone).  I re-read these every once in a while – the sign of a great novel.  Recent great reads include The Elegance of the Hedgehog, Robert Merle’s Fortune de France, and Het Woud der Verwachting (a magnificent historical novel by Hella Haasse on the life of Charles d’Orleans).  From more innocent days, I loved reading The Education of Little Tree to our children (writer was a horrible man, but it’s a lovely little book).

“Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development?

Best non-case law are the Horizontal Guidelines. Undisputably the best judicial decision is KME v. Commission.  The detailed and intensive review required in merger cases after Tetra Laval  now also applies also to cartel cases.  It is already having effect:   In the hearing on the appeal for Masco in the bathroom fittings and fixtures case in February, the Commission explicitly agreed that the General Court should exercise a complete judicial review over the facts.

The worst is Pfleiderer v. Bundeskartellamt. Leniency statements should not be disclosed. The Court did not distinguish self-incriminating leniency applications from pre-existing documents. That is a mistake and could interfere with public policy to encourage revealing and closing down cartels.

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?

1.  The Commission should recognize privilege for in-house counsel who are full members of the Bar.  Even after AKZO, the Commission has the discretion to do so.  It is even more wrong for the Commission to reserve the right to seek access to legal advice from outside counsel who are members of a non-EU bar.  It is a fundamental right of every client to seek legal counsel in confidence from a lawyer of his/her choice.
2. To avoid confirmation bias, the DG Comp team that investigates a case and writes an SO should not be the one to make and write the final decision.  The decision should be adopted (or recommended to the College for adoption) by a separate panel chaired by the Commissioner, which should independently review SO and written pleadings and attend oral hearings.  Right now, decisions are adopted by a College of Commissioners none of whom have read the pleadings or attended the oral hearing, based on internal notes written by the team than write the SO, not accessible to the defendant.  I have great respect for the integrity of EC officials, but this process is institutionally unsound.
3. The “me-too” spirit of international merger control has led to a glut of unnecessary merger laws requiring parallel notifications.  This is a monumental waste of time and resources, combined with a risk (already materializing) that merger control is used by “new authorities” to give advantages to national industries.  Some kind of comity rules should be set out to allow the, say, three jurisdictions most affected to review a case, with others declining or focusing on local product markets.

Average working time/week?

Too long.  Fortunately I love what I do and have an understanding wife, our children have grown up, and the firm has a generous sabbatical and vacation policy.

Why do you work in competition law? How did you first get into it?

It’s intellectually satisfying and relevant.  I have always believed in the European ideal.  Integration of national economies should prevent re-emergence of the old enmities that we have not seen for 67 years, and hope never to see again.

Most interesting, intense or funny moment of your career?

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Prof. Jacques Bourgeois is on this week’s Friday Slot. A few words about Jacques are in order. I first met him as a student at the College of Europe. He was presenting his seminar during the “beauty context” shopping week, when students select their options. I was impressed, so impressed that I did not chose the seminar, for fear of not being up to the challenge. Jacques seemed a somewhat demanding Professor for the continental student I was, navigating with increasing ease in competition and trade law matters, requesting active student participation, and professing in beautiful English.

Our paths crossed again 8 years after, when I started as the executive secretary of the GCLC. We worked together for several years. In my short career I have had the immense chance to meet very many professionals. Yet, I have rarely seen a lawyer with a such mastery of social skills and management capabilities. Jacques is the kind of person who can turn a tense meeting with irritated attendees into a relaxed, and possibly funny, event. This is maybe why everyone in the business likes him, and why we at Chillin’Competition like him so much. Thanks to him for having taken the time to answer our questions. 

“Oscar” of the best competition law book? Non-competition book?

In the competition law field, I praise the book of David Gerber: Law and Competition in Twentieth Century Europe. Protecting Prometheus (Oxford University Press, 2001)

Out of the antitrust world, but still related to the legal field, John Rawls’ A Theory of Justice (Belknap, 1971) is a must.

 “Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development? 

In my opinion, the CJEU made a great job in Confédération européenne des associations d’horlogers-réparateurs (CEAHR) v European Commission (CJEU, 15 December 2010, Case T-427/08).

On the contrary, I am very critical towards the Alrosa ruling (CJEU, European Commission v Alrosa, Case C‑441/07 P).

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?

The one reform that I would organize in priority: that fines be decided upon by a court of law.

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For this fifth edition of the Friday Slot, Chillin’Competition has interviewed a true master competition lawyer, Jean-François Bellis (Van Bael & Bellis, Brussels). The ITW tells it all, Jean-François is a person with many facets, i.e. litigator, entrepreneur, academic, teacher, etc. And the thing is, on all those fronts, he just stands out… It is a great honour for us to publish today his stimulating, inspirational interview.

“Oscar” of the best competition law book? Non-competition book?

Without question, the Van Bael & Bellis competition law book, now in its fifth edition, should win the prize! Seriously now, in my view, the most influential competition law book ever written is Robert Bork, “The Antitrust Paradox”, which so powerfully contributed to establishing the current accepted wisdom that the aim of competition law is to maximize consumer welfare. It is difficult to find a competition law book that has had as significant an effect on the practice of antitrust/competition law.

On the non-competition side, there is an embarrassment of riches. I have great respect for Orwell who, among other things, deserves the Oscar for the best opening line (“The idea really came to me the day I got my new false teeth” in “Coming up for Air”). But, as a lawyer, my vote will go to “The Trial” by Kafka. Quite fittingly, this book was one of the highlights of the course on literature in the first year of my law studies at the University of Brussels. Since I began practicing competition law, I had the impression of performing in it more than once.

“Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development? 

The KME judgment issued by the Court of Justice on 8 December 2011 may turn out to be a landmark case in that it spells out the concept of full review in competition cases. To some extent, it mirrors the Strasbourg Court Menarini judgment issued on 27 September 2011 which affirmed the consistency with Article 6 of the Convention of administrative enforcement procedures provided that they are subject to full review by an independent court.

In terms of worst case-law development, I am concerned that the Court of Justice’s revisiting of parent liability issues last year may be generating uncertainty, and fear that this could potentially have unintended consequences in other areas of EU competition law (such as the possibility that Article 101 TFEU may be applied to intra-enterprise agreements between subsidiaries of the same group).

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For this fourth edition of the Friday Slot, Prof. Richard Whish has taken the time to address our questions. As everyone knows, Prof. Whish is the author of the ultimate EU competition book, a book with a big B which is a model of clarity and accuracy. Amongst other things, in this  ITW, Prof. Whish takes distance with the dominant view on Tomra and TeliaSonera and alludes to encounters with mutant economists. Thanks to him for accepting to appear in the Friday Slot. A great honour for chillin’competition.

“Oscar” of the best competition law book?  And of the best non-competition law book?

Well, obviously I cannot say Whish on Competition Law! I greatly admire Oke Odudu’s The Boundaries of EC Competition Law for incisive and original thinking and for in-depth research. On procedure there is nothing to match the series of essays written by Wouters Wils and published in a series of books since 2002.  As for other books, where to start! I suppose if it had to be just one I would go for George Eliot’s Middlemarch for a view of all things English (good and bad). I am not aware of a finer character in literature than Dorothea Brooke.

“Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development?

I very much liked the judgment of the Court of Justice in TeliaSonera, a view that is not widely shared, it would seem. To suggest that a margin squeeze cannot be an abuse in the absence of a duty to deal, to my mind, would emasculate Article 102 and to limit it to the control of monopoly rather than dominance.

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 wish that we could start over again on refusal to supply and on rebates. I am not a critical as some commentators about the current law in these areas, but I do think that it is difficult to explain quite how we got to where we now are. I have difficulties with Commercial Solvents, which is where the law on refusal to deal started: to what extent was the Court really concerned that Commercial Solvents had discontinued a customer who had become dependent upon it? The national laws on economic dependency do not, to my mind, qualify as ‘competition’ laws, but their existence has percolated into the competition rules.  As for rebates, some of the judgments contain statements that suggest per se illegality, which cannot be correct. Tomra and Intel will be very important judgments on this: to what extent, I wonder, will the Commission’s Guidance document have an influence on the Courts dealing with those appeals?

A different point is that I think that changes are needed at the General Court as to the way that it conducts its review of Commission decisions: I am not thinking so much of the intensity of the review as the actual procedure.

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For this third edition of the Friday Slot, Antoine Winckler (Cleary Gottlieb, Brussels) has taken a shot at our questions. I met Antoine five years ago at a conference on “Non-competition concerns under the EUMR”. He made a great impression and since then, with my competition friends, we refer to him as the “Tribun”. A full biography of Antoine can be found here.  I also know for a fact that Antoine reads our blog regularly.  It is a great honor that he took the time to answer to our questions.

“Oscar” of the best competition law book?  And of the best non-competition law book?

Judge Bork’s  Antitrust Paradox

Boccacio’s Decamerone

“Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development?

Worst : CJEU, C 439/09, Pierre Fabre Dermo-Cosmétique SAS v Président de l’Autorité de la concurrence and Ministre de l’Économie, de l’Industrie et de l’Emploi (another move away from the effects theory)

Best:  Advocate General Sharpston’s Opinion in CJEU, C-389/10 P, KME v. Commission

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 would transform DG COMP into an EU Prosecutor and give the General Court the power to make all antitrust decisions (but only after making sure judges have all followed economics 1.01).

Average working time/week?

When does work really stop?

Why do you work in competition law? How did you first get into it?

You get to work with non-lawyers a lot.

I really wanted to work in Brussels – just kidding.

Most interesting, intense or funny moment of your career?

Watching Judge Vesterdorf being shown a streamed James Bond movie (James Bond in his Aston Martin) during the Microsoft v Commission hearing.

Hearing my learned colleague/partner/dear friend Mario Siragusa and his opponent Antonino Abate from the Legal Service – both pure Sicilians – plead a State-aid case in re-invented French.

Your role model (if any) in the competition community? And outside of it?

Don Holley and Mario Siragusa (my mentors at Cleary)

Winston Churchill

What do you like the least about your job?

Difficult clients

What do you like the most about your job?

Difficult clients

What you like the most about economics in competition law?

Finding an economist coming up with the right answer

What you like the least about economics in competition law?

Economists who repeat what lawyers say

What career/personal achievement are you most proud of?

Having had fun (most of time) working

A piece of “counterfactual” analysis: what would you do if you weren’t in your current position?

Teaching philosophy/literature/history or riding horses

Besides being a “competition geek” (sorry for this one, but we all are), what are your hobbies?

Philosophy and horses

Favorite movies?

Gilda, The Night of the Iguana, Hitchcock and Marx Brothers generally

Favorite music style in general?

Opera

Your favorite motto?

Work is the curse of the drinking classes (Oscar Wilde)

Websites that you visit the most (besides Chillin’Competition)?

Google of course

A piece of advice for junior competition professionals?

Have fun

For this second edition of the Friday Slot, Bill Kovacic (George Washington University, former FTC Commissioner and Chairman)  has  kindly accepted to answer to our questions. I suppose Bill needs no further introduction to most of our readers. Yet, for those of you who have never seen Bill “live”, I have to say he belongs to the top five speakers on the antitrust conference circuit. A biography is attached at the end of this post. Thanks again to him for taking the time to answer our questions (with, as you will see, a great sense of humour and humility).

Question 1: “Oscar” of the best antitrust law book?  And of the best non-antitrust law book?

Here are two books which, owing to their age, may not be well known to new generations of competition economists and lawyers.  For the best antitrust law book, read Ellis Hawley, The New Deal and the Problem of Monopoly (Princeton University Press 1966).  Hawley provides essential background on the US antitrust system, and his discussion of antitrust in the 1930s has powerful relevance today.  For the best non-antitrust law book, read Marver Bernstein, Regulating Business by Independent Commission (Princeton University Press 1955).  Bernstein studies US experience with regulatory commissions, but his assessment has universal application.  Most honorable mention for category two: Richard Harris & Sidney Milkis, The Politics of Regulatory Change – A Tale of Two Agencies (Oxford University Press, 2d Edition, 1996).  Every newly appointed competition agency leader should read this book before the job begins.

Question 2: “Oscar” of the best case-law development in the past 5 years? “Oscar” of the worst case-law development?

My nominees for best and worst are FTC cases I worked on.  The envelope with my answers can be opened five years hence.

Question 3: Let’s do it like economists => assume that you could change 3 rules, principles, judgments, institutions in the current US antitrust system. What would you do?

Three institutional changes to the US system:

First, reform the criteria that academics, government officials, journalists, and practitioners frequently use to grade competition agencies.  Abandon performance measures that equate activity (cases filed, fines imposed, days in prison) with accomplishment.  Define agency effectiveness by the economic outcomes achieved by litigation and non-litigation policy tools.  When a competition agency official says “We’ve been very busy!,” respond “Have you been very effective?”

Second, bolster efforts by competition agencies and external researchers to measure the economic effects of antitrust policy.   Evaluating outcomes is a difficult, necessary task.   Distrust assertions that competition law is valuable economic policy, but there is no way to tell if it works.

Third, increase policy integration between the two federal antitrust agencies and among the federal authorities and the states.  Create a US equivalent of the European Competition Network.   Greater policy coherence at home is ever more important to influence norms abroad.

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At Chillin’Competition, we have decide to emulate an unpopular practice of DG COMP. From now onwards, we will be launching Friday requests for informations (“RFIs”).

In line with the spirit of this blog, our RFIs will be a bit different from those of DG COMP. Our targets will be big names in the antitrust world who, in addition, are interesting people with a good sense of humor. Just like this blog, our questions will be partly professional and partly personal.

To start this new venture – in principle, the Friday slot will be opened twice a month – we have sent our first RFI to no other antitrust superstar than Mr. Ian Forrester (White and Case, full biography available at the end at this post)!

And guess what: Ian has accepted to address our questions very swiftly, and has provided remarkable, insightful, thought-provoking answers. Again, we are immensely grateful to Ian for the time he took to answers our questions. In exchange for his time, we offered him to baptise this new series of posts, and he offered the title “The Friday Slot” that appears on top of this post.

Question 1: “Oscar” of the best competition law book?  And of the best non-competition law book?

The shortest and simplest book is by David Edward and Bob Lane: “European Community Law: An Introduction”.  Competition law is not complex, though it can be made sophisticated.  Proper analysis of the realities of the marketplace is where everything should start.

The items of competition law literature which I most regularly use are the reviews of competition law in the Oxford Yearbook of European Law since the first volume in 1981. Francis Jacobs was the first editor and for about fifteen years Chris Norall and I squeezed the juice from every development. We tried to avoid accepting the official propaganda and to enjoy advancing our particular theories. Then the reviews went through a period of being too comprehensive and too lengthily thorough, but now we are back on a good rhythm. The reviews are lively and opinionated, and you can disagree with them, but they ought not to be boring. Writing them has been hugely instructive for my colleagues (jacquelyn Anthony , Makis and a platoon of other talents) and me, a great way of learning, digesting and explaining. I often use the OYEL review as a way of reminding myself of what was important in a case. Sometimes that matches conventional wisdom and sometimes it doesn’t.

Question 2: “Oscar” of the best case-law development in the past year? “Oscar” of the worst case-law development?

The Oscar to the best case-law development could go to the Swiss watch parts case, where the Court overturned a Commission refusal of a complaint and took us back to simpler times when small folk could look to the protection of the competition rules. It is very rare for such challenges to succeed and the Court did a really careful job in writing its judgement.

Question 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?

Criminal liability; proof beyond a reasonable doubt; and judicial review as ferocious as the House of Lords.

Question 4: Average working time/week?

Excessive!  I travel a lot, and when I am away the e-mails multiply, as do the messages from editors wanting manuscripts.  But I am not complaining.  It is fun to do interesting work in interesting places.

Question 5: Why do you work in competition law? How did you first get into it?

By accident.  I was a customs specialist, then made a complaint for a friend’s uncle against a whisky producer (differential pricing): Bulloch/Distillers Co. Ltd.  That was my first case in Luxembourg.  Lord Bethell was the next, about the rights of complainants.  Others followed.  I never studied competition law, or indeed EEC law, at university, an educational void which is unlikely to be remedied. Read the rest of this entry »