The Rise of ROW Anti-Cartel Enforcement

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John M. Connor, Sep 16, 2015

International hard-core cartels are typically the most injurious price-fixing offenses, yet they are also the most difficult to prosecute. Detecting collusion and assembling evidence that lies outside an antitrust authority’s jurisdiction, combating large well-lawyered multinational corporations, and imposing effective remedies are challenging when faced for the first time.

Effective anti-cartel enforcement began in the United States about a century ago, beginning with purely domestic cartels. Then, in the mid 1940s, the Antitrust Division of the Department of Justice (“DOJ”) extracted nolo pleas from about 40 international cartels.Because of a number of prosecutorial hurdles, the first U.S. prosecutions that resulted in criminal fines imposed on international cartels did not begin until the late 1980s. The only other jurisdiction that had fined an international hard-core cartel was the European Union through its Commission.

By several measures, these two jurisdictions virtually monopolized the business of fining international cartels in the 1990. Partly as a consequence, many geographically widespread international cartels escaped having their collusive profits disgorged by the young competition-law authorities in Africa, Asia, and Latin America. That is, the absence of anti-cartel enforcement in the rest of the world (“ROW”) contributed to sup-optimal deterrence.

The ROW antitrust authorities have made extraordinarily rapid progress in punishing international price-fixing. Building in part on legal innovations made by the DOJ and EC, many of these newer authorities are close to matching the effectiveness of the two crucibles of anti-cartel enforcement. Indeed, in early 2015, a law-firm’s report—widely cited in the antitrust news—made the startling assertion that the ROW agencies had accounted for half of all the world’s announced antitrust fines.

In this article, I will examine the rise of ROW cartel enforcement over the past 25 years in greater detail and with more indicators than previous publications.



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