Troubled waters between US and European antitrust

Posted by Social Science Research Network

Troubled waters between US and European antitrust

By D. Daniel Sokol (University of Florida)

Abstract:     Antitrust is an important area of law and policy for most companies in the world. Having divergent rules across antitrust systems means that the same economic behavior may be treated differently depending on the jurisdiction, leading to disparate outcomes in which one jurisdiction finds illegal behavior (but the other does not) when the underlying behavior may be pro-competitive. This disparate set of outcomes creates a world in which the most stringent antitrust system may produce the global standard. As a result, if the antitrust rules applied are too rigid, they threaten to hurt consumers not merely in the jurisdiction where they are applied but globally as well. The stakes are high, not merely in the tech sector but more generally. Other jurisdictions look to both the United States and Europe for guidance for antitrust jurisprudence.

In their book The Atlantic Divide in Antitrust: An Examination of US and EU Competition Policy, Daniel Gifford and Robert Kudrle analyze a distinct set of cases across a number of different substantive areas in the two jurisdictions. In doing so, they also discuss the potential for both convergence and divergence Their comparative analysis makes an important and well informed contribution to the literature, even if parts of the book might have limitations.

This Review first explores the developments of the goals of antitrust (and how these goals shape enforcement) and the particular insights and shortcomings of Gifford and Kudrle’s investigation into comparative antitrust — in particular, the area of greatest cross-Atlantic discord: cases involving single firm conduct, especially in markets characterized by high tech and innovation. Second, this Review explores cartel law and policy — a topic that Gifford and Kudrle overlook entirely. This is a surprising omission given that cartel activity is the highest enforcement priority both the United States and Europe (at the EC level). Moreover, it is an area in which the law and policy is in flux in both.

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