international

Leniency and Criminal Sanctions: Happily Married or Uneasy Bedfellows?

This this chapter of the book Anti-Cartel Enforcement in a Contemporary Age: Leniency Religion, the authors consider a range of theories that may explain the dynamics in the cartel leniency — cartel criminalisation relationship and, in particular, that address the question as to whether the relationship suggests a largely instrumental justification for criminalisation (that is, using criminal sanctions to bolster leniency policies), as distinct from a more normative justification (that is, using criminal sanctions to reflect and punish the harmful and delinquent nature of cartels). Whichever theory is favoured, the authors argue that the relationship is problematic, replete with ambiguities, tensions and contradictions that threaten the legitimacy and effectiveness of both competition and criminal law enforcement. In making this case, Harding, Edwards and Beaton-Wells canvas the fragility of the economic policy justifications for singling out certain types of cartel conduct for criminal treatment; the retributive compromise and foreclosure inherent in a leniency-driven strategy of enforcement; the ways in which leniency policy underscores and may even reinforce the otherwise immoral (cheating) behaviour said to attract the moral opprobrium associated with criminal sanctions; the ways in which leniency policy shapes and distorts the relationship between cartelists as prospective leniency applicants and competition authorities; and the potential for leniency policy to be ‘gamed’ by cartelists and the associated risk of business capture of the legal process.
Reference :

Christopher Harding, Caron Beaton-Wells and Jennifer Edwards, 'Leniency and Criminal Sanctions: Happily Married or Uneasy Bedfellows?' in in C Beaton-Wells and C Tran (eds), Anti-Cartel Enforcement in a Contemporary Age: Leniency Religion, Hart Publishing, 2015, ch 12, pp234-260

Anti-Cartel Enforcement in a Contemporary Age: Leniency Religion

Leniency policies are seen as a revolution in contemporary anti-cartel law enforcement. Unique to competition law, these policies are regarded as essential to detecting, punishing and deterring business collusion – conduct that subverts competition at national and global levels. Featuring contributions from leading scholars, practitioners and enforcers from around the world, this book probes the almost universal adoption and zealous defence of leniency policies by many competition authorities and others. It charts the origins of and impetuses for the leniency movement, captures key insights from academic research and practical experience relating to the operation and effectiveness of leniency policies and examines leniency from the perspectives of corporate and individual applicants, advisers and authorities. The book also explores debates surrounding the intersections between leniency and other crucial elements of the enforcement system such as compensation, compliance and criminalisation. The rich critical analysis in the book draws on the disciplines of law, regulation, economics and criminology. It makes a substantial and distinctive contribution to the literature on a topic that is highly significant to a wide range of actors in the field of competition law and business regulation generally.
Reference :

Caron Beaton-Wells and Christopher Tran (eds), Anti-Cartel Enforcement in a Contemporary Age: Leniency Religion (Bloomsbury, 2015)

Margin Squeeze in the Telecommunications Sector: A More Economics-based Approach

A margin squeeze occurs when a vertically integrated company, dominant in the supply of an indispensable upstream input, pursues a pricing policy which prevents downstream competitors from trading profitably, thereby leading to their ultimate exclusion from the downstream market. In the telecommunications sector, where large ex-state firms still enjoy considerable market power, margin squeeze has long been frequent. Interestingly, the United States and the European Union have tackled this problem in considerably different ways. Dismayed by the idea of an antitrust court intervening in a company’s price setting, the US Supreme Court held that margin squeeze was exclusively the domain of regulation. Conversely, the Court of Justice of the European Union has endorsed a modern economics-based approach enabling competition authorities to engage in a coherent and verifiable antitrust assessment of the price differentials that potentially amount to a margin squeeze. This paper will argue that (1) the economics-based approach is the right solution in the European context, but that (2) this approach will only lead to convincing results if it includes a rigorous and transparent analysis of the effects on competition and consumers.
Reference :

World Competition 35(2)/2012, S. 205–232 (Kluwer Law International BV, The Netherlands)

Freedom of Choice - The Emergence of a Powerful Concept in European Competition Law

as the world is looking for a new standard to design and apply rules of competition, one possibility would be to let markets decide what is best for them.
Reference :

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2077694