The Antitrust Treatment of Unilateral Effects: A U.S. Perspective
The success of the Areeda-Turner test for predatory pricing and the U.S. Supreme Court’s adoption of demanding proof requirements in its 1993 Brooke Group decision have made it very difficult for plaintiffs to win conventional predatory pricing claims.
With a major set of hearings scheduled in the United States on the antitrust treatment of single-firm conduct, economists have an opportunity to provide analysis that informs policy. Yet, the opportunity will be lost if economic analysis does not provide insights into how to distinguish anticompetitive from pro-competitive behavior.
From the Editor
Firms with market power engage in a variety of business practices that harm their rivals. Under what circumstances should the antitrust laws condemn these practices because they will harm consumers?
The Antitrust Treatment of Unilateral Effects: An EC Perspective
This report argues in favour of an economics-based approach to Article 82, in a way similar to the reform of Article 81 and merger control.
This paper reviews the position put forward by the Commission in relation to the concept of an exclusionary abuse, the meaning of dominance, and the use of an efficiency defense.
DG Competition’s discussion paper appears to signal a departure from the form-based approach articulated most strongly in Michelin II. However, its full significance is limited by the enunciation of a precautionary principle under which abuse is framed to capture any conduct likely to limit entry or expansion and justification is limited to the narrowest plausible extent.
The structure of trading service markets is a fundamental determinant of the cost of capital for business. Competition has an important role to play in delivering efficiencies, particularly in the context of inherited fragmentation that characterizes the European Union, and to this end regulation and competition policy need to go hand in hand.
On December 14, 2005, the European Court of First Instance upheld the European Commission’s 2001 prohibition of a proposed merger between General Electric (GE) and Honeywell.
Reply to Winter’s Vertical Restraints and Antitrust Policy: A Reaction to Cooper, Froeb, O’Brien, and Vita
In the Autumn 2005 issue of Competition Policy International, the authors published an article on the antitrust policy implications of the theoretical and empirical literature on vertical restraints. In an accompanying comment, Professor Ralph Winter claims that the authors are advocating an enforcement standard that in any particular case would ignore case-specific evidence of the restraint’s effects.
In this rejoinder, the author first responds to the discussion in Cooper, Froeb, O’Brien, and Vita’s Reply to Winter of a technical point, the relationship between retailer incentives and retailer margins, and then sets out their common ground and remaining differences on the broader theme of theory and evidence in vertical restraints cases.
Despite the obvious importance of the question to a statute as vaguely phrased as the Sherman Act, the federal courts in all the years since 1890 have never arrived at a definitive statement of the values or policies which control the law’s application and evolution.
The Sherman Antitrust Act of 1890, the cornerstone of the U.S. antitrust regime, broadly prohibits contacts, combinations, and conspiracies in restraint of trade and makes it unlawful to monopolize any line of commerce.