Daniel Sokol ‘Reinvigorating Criminal Antitrust?’ (2019) William & Mary Law Review 60 1545

A number of non-cartel antitrust infringements remain crimes under US law, even if they are not prosecuted in practice. This article, available here, deals with the implications of recent claims for increased antitrust enforcement for the application of such provisions.  A natural extension of enforcement would be to advocate the use of criminal sanctions for various antitrust violations outside of collusion which are “on the books” but have not been used in over a generation. The article argues that a return to the criminalisation of non-collusion related antitrust abuses is problematic not only as a matter of optimal deterrence, but also unconstitutional as a matter of law. Section one describes how antitrust criminalisation is a form of achieving deterrence. Antitrust enforcement builds on models of optimal deterrence. Under an optimal deterrence antitrust framework, a firm or individual will be deterred where the expected costs of illegal activity, taking into account the probability of detection and magnitude of the penalties, exceed…

Beatrice Stange on ‘Romano Pisciotti v Bundesrepublik Deutschland: Increased Risk of Extradition for EU Citizens after Involvement in US Cartels’ (2019) Journal of European Competition Law & Practice 10(2) 89

This paper, available here , discusses the first deportation of an EU citizen to the US for competition law infringements. It focuses on a recent judgment by the Court of Justice of the European Union on this matter. A first section outlines the factual background of the case. In 2010, a US arrest warrant was issued for Italian businessman Romano Pisciotti on account of his involvement in the marine hoses cartel. In 2013, the German federal police arrested Mr. Pisciotti at Frankfurt Airport during a stopover of his flight from Nigeria to Italy. He was provisionally detained and, a few months later, the German authorities accepted the US request for extradition despite Mr. Pisciotti’s legal appeals, inter alia before the German Federal Constitutional Court. Other extradition requests from the US authorities had so far been unsuccessful, mainly because most international extradition agreements (including the Treaty between Germany and the US) require that the sanctioned conduct must be a crime in…

Chiara Muraca ‘Cultural and Political Forces in the Criminalisation of Cartels: A Case Study on the Chilean Experience’ (2018) World Competition 579

In addition to rising monetary fines against both companies and individuals, over the last ten years more than thirty countries have decided to criminalise cartel activities. At the same time, and despite the growing number of countries opting for a criminal enforcement, the implementation of such measures has been quite deficient outside the US. Many of these countries have encountered procedural and political obstacles to enforcing criminal provisions against anticompetitive conduct, including a lack of support from key players in the enforcement process. Among the main explanations for this state of affairs is a belief that criminalisation of cartels outside the US is often the product of a top-down process led by transnational enforcement interests rather than domestic bottom-up forces. The aim of this article, available here, is to test this explanation by conducting an empirical study of criminalisation efforts in Chile. The study involved interviews with the main stakeholders who took part in the criminalisation process in Chile, such…

Peter Whelan ‘Competition Law and Criminal Justice’ in The Intersections of Antitrust, Galloway (ed.), (Oxford University Press, forthcoming)

As opposed to other types of market conduct (such as, e.g., vertical distribution agreements or the unilateral use of market power), cartels are widely perceived to have few if any redeeming features. In recent years, one can clearly detect a firm commitment from antitrust enforcers around the globe to pursue rigorously the investigation, detection and prosecution of cartel activity. Aligned with this development is a growing tendency in a wide variety of jurisdictions to hold individuals accountable for the creation and implementation of cartels, including through use of criminal law. Unfortunately, the employment of criminal cartel sanctions is not without its problems. This paper, available here, seeks to evaluate some inherent problems associated with the use of criminal sanctions for cartel conduct to deter anticompetitive behaviour. It is structured as follows: Section B outlines the deterrence-based justification for criminal cartel sanctions. The primary rationale for the criminal cartel sanctions is economic deterrence. Unlike retribution, deterrence does not concern itself with…

Andreas Stephan ‘An empirical evaluation of the normative justifications for cartel criminalisation’ (2017) Legal Studies 37(4) 621

A growing number of jurisdictions treat ‘hard-core’ cartel conduct as crime, in the belief that the threat of incarceration is necessary for deterrence. For many years, the US was the only active criminal cartel enforcement regime in the world. Cartels were first prohibited under the US Sherman Act 1890 as misdemeanours, and became a felony in 1974. The US Department of Justice regularly secures convictions of firms and individuals – many of whom agree to serve custodial sentences under negotiated plea agreements – from around the world. In the past 20 years, there has been an international movement towards the US model. Around 25 jurisdictions have criminalised ‘hard-core’ cartel conduct, including the UK, France, Ireland and Australia – with many more having adopted criminal offences that relate only to bid-rigging in public procurement. Most of these jurisdictions have chosen to retain their civil enforcement powers in parallel, so as to use criminal enforcement selectively. However, there is still disagreement over…

John Connor and Dan Werner  ‘Variation in Bid-Rigging Cartels’ Overcharges: An Exploratory Study’

This working paper  is available here. A summary version, called ‘New Research on the Effectiveness of Bidding Rings: Implications for Competition Policies’ (2019) CPI Antitrust Chronicle April,  can be found here but I have to say I found this shorter version to be slightly confusing, so I would advise you to read the longer paper. There seems to be a consensus that bid rigging is more harmful and deserving of higher penalties than ordinary price fixing violations. Reflecting this, there is empirical evidence that antitrust penalties are more severe for rings than for classic price-fixing cartels. A number of jurisdictions, such as Germany and Italy, impose criminal liability only for bid rigging infringements, but not for other types of cartel. Multilateral organisations, such as the OECD and the International Competition Network, have given special attention to the problems of enforcement against bid rigging. Yet, this antipathy toward bid rigging relative to the more common form of collusive conduct (classic price…

Andres Caro ‘Leveraging market power online: the Google Shopping case’ (2018) Competition Law Journal 17(1) 49

The Google Shopping case raises many important questions, such as: how do we deal with the leveraging of market power in digital markets? How do we weigh the benefits to consumers against the potential harm to competition? And, lastly, what are the appropriate remedies for this type of behaviour? In addressing these questions, this paper is structured as follows: A first section describes the background to the Google Shopping decision by the European Commission. Google aggregates, sorts, displays and provides direct access to retailers’ webpages in exchange for a fee through Google Shopping. Other online platforms, including Nextag, Foundem and Shopzilla, offer similar services. However, until early 2018 ‘while competing comparison shopping services can appear only as generic search results and are prone to the ranking of their web pages in generic search results on Google’s general search results pages being reduced (‘demoted’) by certain algorithms, Google’s own comparison shopping service is prominently positioned, displayed in rich format and is…

Giovanna Massarotto ‘From Standard Oil to Google: How the Role of Antitrust Law Has Changed’ (2018) World Competition 41(3) 395

This paper, which can be found here, explores the evolution of antitrust over time, and how some of the challenges with network businesses are recurring issues for competition law. It is structured as follows: Section 1 examines the evolution of antitrust law over time. Before the introduction of antitrust law, markets were generally subject to self-regulation. Antitrust was introduced to regulate a number of business practices without engaging in full-fledged regulation. Nonetheless, antitrust has teeth and can be quite intrusive. A first example of this can be seen in the Standard Oil case. Standard Oil’s success was mainly due to a set of mergers and trusts it entered into with its competitors and railroads. The result of this success was that, by the 1890s, most businesses had to deal with Standard Oil or with one of the constituents of its extensive trust l. In order to address the  ‘evil of restriction of output’, the Supreme Court ordered the dissolution of the…

The OECD Report on International Private Enforcement

Officially known as ‘Individual and Collective Private Enforcement of Competition Law: Insights for Mexico in 2018’, this Report was prepared with a view to advise Mexico on how to reform its private enforcement regime. The Report can be found here. Advising Mexico in this regard required the pursuit of a comprehensive overview of international experiences with private competition enforcement – with a focus on Europe and North America, but also looking beyond these regions. This project also required the identification of the various elements that comprise private enforcement regimes around the world, the various forms that each of these elements may take, and how these elements relate to one another. I may of course be mistaken, but I think there is no other work like this in the market. As such, I circulate the Report here because I think it can provide a useful reference for anyone working or interested in private enforcement.

Damien Geradin and Katarzyna Sadrak‘The EU Competition Law Fining System: A Quantitative Review of the Commission Decisions between 2000 and 2017

This paper – which can be found here – takes a quantitative approach to analysing the factors considered by the Commission when establishing the amount of fines imposed on infringing undertakings in 110 cartel decisions, as well as on 11 abuse of dominance decisions adopted between January 2000 and March 2017. The analysis shows that the Commission has made significant use of the aggravating and mitigating circumstances listed in the Fining Guidelines to adjust the basic amount of the fine. The article is structured as follows: Part II examines the methodology applied by the Commission when determining fine amounts. Article 23(2) of Regulation 1/2003 is the sole legal basis for the imposition of fines by the Commission for anti-competitive conduct. This Article provides that “the fine shall not exceed 10% of [the undertaking’s] total turnover in the preceding business year’. To make its method for setting fines clearer and more transparent, the Commission had published Fining Guidelines in 1998, which were…