Patrick Actis Perinetto and Natalia Latronico ‘The Bitter Medicine: Competition Law and Parallel Trade in the Pharmaceutical Sector’ (2017) World Competition 40(10 93

This article – which you can find here – is a rather straightforward piece on restrictions on parallel trade of pharmaceutical products as a competition law infringement. It begins by analysing the most relevant features of parallel trade in the pharmaceutical sector. In Europe, a prohibition of restrictions on cross-border trade under EU competition law is coupled with the fact that the main purchaser of pharmaceuticals are the member states, which are free to adopt their own approach with respect to pricing and public reimbursement. Given the resulting price differentials between member states, parallel trade occurs as wholesalers take advantage of the arbitrage possibilities by exporting products from a low-price country to a high-price one and pocketing the margins. Having established this, the paper moves into reviewing the main strategies used by companies to counter such parallel trade. Such practices include refusal to deal/prohibition of exports, vertical integration, quota systems and dual pricing schemes. The paper identifies each strategy in turn,…

Jens-Uwe Franck and Martin Peitz ‘Toward a Coherent Policy on Cartel Damages’ (2017) ZEW Discussion Paper No. 17-009

This paper – which can be found here – looks at who should have standing in private cartel damages claims. It is an economics paper, so it engages in a normative / most-efficient analysis of who should have standing to claim damages for antitrust infringements. It also looks into both the US and EU’s legal system in detail, to see whether / how their proposal could work. Their main argument is that cartelists should also be liable for damages caused to firms that supply the cartel or the cartel’s customers with complementary product components. What connects these classes of firms is that they may suffer a loss due to cartel‐induced underpayment. In response to the cartel’s output reduction, they may find it a profit‐maximizing strategy to lower their prices to mitigate the decline in demand, thereby effectively reducing the damage to the cartel’s purchasers. In particular, the authors develop a model which purports to demonstrate that the allocation and distribution of…

Ariel Ezrachi ‘The Ripple Effects of Online Marketplace Bans’ (2017) World Competition 40(1) 47

This paper – which you can find here – assesses the economic and legal implications of online marketplace bans in order to determine what treatment they should be subject to under competition law. The discussion opens in Chapter 2 with a review of different types of online marketplaces. Online marketplaces bring together large numbers of sellers and buyers, and in doing so facilitate dynamic competition, both in relation to greater inter-brand competition and in relation to intra-brand competition. Nonetheless, there are various types of such marketplaces, which could be distinguished on the basis of their particular characteristics. These include: (a) whether online marketplaces are pure or hybrid intermediaries (pure intermediaries are merely platforms for buyers and sellers, while hybrid intermediaries provide a sales platform but also act as retailers on their own platform); (b) open or closed marketplaces (any seller can gain access to an open marketplace, while closed marketplaces impose access restrictions); (iii) the type and quality of the interface on…

Pedro Caro de Sousa ‘Free Movement and Competition in the European Market for Pharmaceuticals’ in in Pablo Figueroa and Alejandro Guerrero Perez (eds.) EU Competition and Trade Law in the Pharmaceutical Sector (Elgar), Chapter 13

This is a paper of mine – which you can find here – that looks at the interaction of free movement and competition law as regards the pharma sector in Europe. Very few industries are as profoundly influenced by regulation as the pharmaceutical industry. All aspects of the life-cycle of new drugs are regulated, from patent application, to marketing approval, commercial exploitation, patent expiration and competition with generics. The nature of demand for drugs, the identity of drugs brought to market, and the nature of competition in the drug market over time are all shaped by regulation. Throughout much of the world, administrative regulation, rather than competition policy, dominates efforts to afford consumers and governments adequate access to affordable drugs. As a result, the nature of competition in this market is sui generis. A significant number of infringements to competition law in this sphere across the world are concerned with practices that seek to take advantage of or manipulate the…

Lisa Khan ‘Amazon’s Antitrust Paradox’

This is a bold paper which argues that competition law, as it stands, is not an apt gauge of competition in the twenty-first century marketplace—especially in the case of online platforms. It was published in the Yale Law Review, and can be found here. The argument is built around a critique of the way antitrust has (failed to) deal with Amazon. In particular, it argues that a close look at Amazon’s business strategy reveals that the current framework of antitrust— especially how it equates competition with “consumer welfare”, and “consumer welfare”  with short-term effects on price and output—fails to capture the architecture of market power in the twenty-first century marketplace. The paper holds that, instead, antitrust should analyse the underlying structure and dynamics of markets. Rather than pegging competition to a narrow set of outcomes, this approach would examine the competitive process itself. Animating this framework is the idea that a company’s power, and the potential anticompetitive nature of that power,…

Thibault Schrepel ‘A New Structured Rule of Reason Approach For High-Tech Markets’

This paper attacks, the assumption that a number of practices in high tech markets should be presumed to be legal. It was published in the Suffolk University Law Review, and can be found here. It seeks to build on Easterbrook’s framework for designing efficient antitrust rules, and to develop a structured rule of reason framework that could apply to the new economy.  It does this by: (i)  distinguishing between per se rules and rule of reason standards; (ii)  reviewing the arguments for and against the adoption of per se rules, in order to explain why per se rules are not appropriate for high tech markets; (iii) lastly, developing an approach that replaces per se rules with an “administrable” structured rule of reason applicable in innovation and high tech markets whenever “the practice has not proven to be pro-competitive in every case”. The paper provides a decent overview of the discussion about rules and standards in antitrust. Further, it makes one…

Christopher Buccafusco and Jonathan Masur ‘Intellectual Property Law and the Promotion of Welfare’

This paper – a University of Chicago Public Law & Legal Theory Paper Series, No. 607 (2017) available here – focuses on the relationship between IP and welfare. Broadly speaking, the paper is devoted to examining the various types of theories underpinning IP law (i.e. IP law’s deeper normative goals) in the US context. As the authors put it: “Most courts and scholars agree with the idea that IP law should provide incentives to creators, but there has been almost no analysis of why creativity and innovation are good. This is simply taken as given.” Their goal is to discuss the variety of ways in which one can understand the normative goals of IP regimes. The basic argument is that the main goal of IP laws should be to maximize social welfare, where welfare is understood as subjective well-being. However, and although there is broad consensus that the law should promote good outcomes, there has been less discussion of the kinds…

Jorge L. Contreras ‘FROM PRIVATE ORDERING TO PUBLIC LAW: THE LEGAL FRAMEWORKS GOVERNING STANDARDS-ESSENTIAL PATENTS’

This paper, focusing on the interaction of standards and international law, was published in the Harvard Journal of Law & Technology, and can be found here. It starts from the observation that there is a “basic question [about] whether technical standard setting is best conceptualized as a private activity governed most efficiently by its own internal rules and procedures, or whether it is at root a public activity that should be regulated within the sphere of public law.” The article proceeds as follows: after a general introduction to private ordering structures (i.e. rules systems that private actors conceive, observe, and often enforce through extra-legal means) in Part II, Parts III and IV describe how technical standard setting has evolved as a private sector activity. Part V analyses the incorporation of standards bodies’ rules and norms into private law adjudication. Part VI shifts the focus to the public benefits that standard setting affords, and Part VII describes the recent debate regarding public…

David Evans ‘THE EMERGING HIGH-COURT JURISPRUDENCE ON THE ANTITRUST ANALYSIS OF MULTISIDED PLATFORMS’

This paper – available here – reviews various court decisions adopted between September 2014 and 2016 that apply competition law to matters involving multisided markets. The paper is short, and the structure is quite simple: after summarizing the key differences between multisided markets (the author insists in calling them matchmakers) and traditional businesses, it reviews the aforementioned court decisions. The article is quite short, and provides a succinct overview of these cases and their implications for antitrust analysis of matters involving multisided platforms. These include three decisions regarding payment cards, including the US Court of Appeals decision on American Express  and the European Court’s decisions in Groupement des Cartes Bancaires and MasterCard; the GoogleMaps decision by the Cour d’Appel de Paris; and the Telcent decision by China’s Supreme People’s Court. The conclusion is that all these decisions recognize that platforms serve multiple interdependent groups of customers, and that the interactions between these groups matter for the substantive analysis of antitrust…

Asda Stores Ld & Ors v MasterCard 2017 EWHC 93 (Comm)

This decision – available here – concerns a standalone claim for damages against MasterCard brought before the English courts. As some of you will know, disputes over the legality of Multilateral Interchange Fees (MIFs) and various payment card-schemes has been ongoing for well over a decade.  In the US, it included a decision on the legality of the American Express System which has found its way to the Supreme Court docket. In this case, which follows a decision by the European Commission – but is not a follow on claim since the practices in question, while similar, are not the same ones that were subject to the Commission’s decision – the English courts had to decide whether the level at which MasterCard set its MIFs was illegal, and hence whether damages are due. You may be pleased to hear that the decision is long and complicated – if nothing else, because it conducts an in-depth effects based assessment that hinges…