Antitrust Chronicle® 2020

December 2020 - II

The Future of IP Licensing Standard Essential Patents (“SEPs”) have been at the center of a controversial debate for almost two decades. Most recently, a flurry of cases over 2020 from appellate courts in the United States, Germany, and the United Kingdom significantly advanced and harmonized the law around global FRAND litigation. These three judgments by the Federal Court of Justice of Germany (Sisvel v. Haier), the Supreme Court of the UK (Unwired Planet v. Huawei), and the U.S. Court of Appeals for the 9th Circuit (FTC v. Qualcomm) may have changed the landscape in international FRAND litigation.

December 2020 - I

Vertical Restraints In this edition of the CPI Antitrust Chronicle, we look at the topic of Vertical Restraints. Generally speaking, within competition law, a vertical restraint is an agreement undertaken at different levels of production, distribution, or supply (e.g. an anti-competitive agreement between a manufacturer and distributor).

November 2020 - II

Data Portability The question of data portability, in its many forms, has long been an antitrust issue. This stems back as far as the Microsoft interoperability cases of the 1990s, or even further (notably such as in telecoms markets). Today, however, data portability has taken on even greater importance in antitrust dis- course. Like many concepts, it is a double-edged sword.

November 2020 - I

Collaboration Agreements In this Chronicle we address the question of collaboration agreements. Collaboration agreements are a double-edged sword. On the one hand, anticompetitive cooperation between competitors is precisely what the antitrust laws are designed to prevent. On the other, the antitrust laws must foster efficiency and innovation, and sometimes collaboration is necessary to achieve these aims.

October 2020 - II

Antitrust Policy in the 21st Century: Is There a Need for Reform? In this special edition of the Antitrust Chronicle we feature pieces from contributors to CPI’s policy roundtable sessions on “Antitrust Policy in the 21st Century: Is There a Need for Reform?” held in July of this year. The sessions touched on several key topics facing practitioners, legislators, and enforcers as we face into the third decade of this century.

October 2020 - I

CRESSE Insights 2020 The October 2020 CPI Antitrust Chronicle includes articles based on presentations from the online Special Policy Sessions (“SPS”) organized by CRESSE in collaboration with CPI in June – July 2020. The contributions here include articles by a number of prominent economists and legal experts. The 2020 SPSs focused on the following topics: • Controlling pre-emptive mergers: in need of a new approach? • Vertical mergers: enforcement developments and guidelines • Antitrust and regulation in the digital economy

September 2020 - II

Price Gouging Price gouging is perhaps the most paradoxical of antitrust offenses. Courts and regulators are at pains to point out that the mere possession of monopoly power is in itself not problematic. Yet the most natural expression of monopoly power – charging monopoly prices – is nonetheless a potential infringement. Drawing up appropriate rules and benchmarks to assess price gouging is notoriously difficult. For this reason, authorities and courts are loath to enforce this aspect of the law. The picture is further complicated by the myriad adjacent rules and regulations governing prices in various jurisdictions, and on a sector-by-sector basis.

September 2020 - I

Failing Firm Defense This Chronicle addresses the failing firm defense in merger control. The failing firm defense is frequently invoked, but is seldom successful. In theory, at least, the defense has a certain intuitive appeal. By definition, for a merger to be illegal, its implementation must substantially lessen (or “significantly impede”) competition. If, in the counterfactual, the acquired firm would simply go out of business, there can be no lessening of competition. But, in reality, acquirers of viable firms have an incentive to exaggerate the woes of the target to receive approval.

August 2020 - II

State Attorneys General In this Chronicle we feature contributions from the offices of State Attorneys General from across the U.S. It is sometimes forgotten that the U.S. has 53 agencies that enforce the antitrust laws: the DOJ, the FTC, 50 states, and the District of Columbia. States Attorneys General thus form key pieces of the U.S. enforcement jigsaw.

August 2020 - I

Editorial Board Antipasto This summer, the August 2020 Antipasto edition of the Chronicle features articles from members of the CPI Editorial Advisory Board. This compilation of articles covers a variety of jurisdictions and a diversity of antitrust topics including the regulation of multisided platforms, the acquisition of foreign-subsidized companies and merger information requests in the EU, and the treatment of non-compete clauses and hub-and spoke infringements in China, among others.

July 2020 - II

Sustainability and Antitrust Sustainability has forced its way center-stage in the world of antitrust, and not before time. It has for a while been a familiar topic in academic circles, but agencies and practitioners are now increasingly alive to the pressing need to make antitrust part of the solution and not part of the problem. What is that problem? That familiar antitrust dogmas are seen as impeding the joint industry responses needed to rise to the pressing issues of the day. Sustainability Antitrust Chronicle.

July 2020 - I

Algorithms Revisited Algorithms rule the digital economy. The ranking of search results, the targeting of content and ads to users, and, increasingly, the pricing of goods online, are all determined by algorithms. In essence, an algorithm is a finite set of steps executed by a computer to solve a given problem. But the economic, ethical and legal questions raised by algorithms are seemingly infinite. Do algorithms facilitate price collusion? If so, how can such behavior be detected? Should corporations be held liable for pricing conduct when this is carried out by an algorithm rather than the company’s officers? Are there other areas, beyond pricing, where algorithms could give rise to anticompetitive conduct? For example, could companies be held liable for exploiting or “gaming” third parties’ ranking algorithms to stifle nascent competition? On the flipside, could algorithms not lead to greater efficiency, by ensuring that companies will undercut rivals’ prices as promptly as possible? In this context, could deviation from an algorithmic result to favor one’s own business be categorized as an abuse? Moreover, could algorithms be used as a tool to disrupt anticompetitive behavior, either by other competitors, or in the hands of competition authorities? These are but a few of the questions raised in this month’s Chronicle. How to deal with algorithms will be a defining issue for antitrust enforcement over the coming years. Lastly, please take the opportunity to visit the CPI website and listen to our selection of Chronicle articles in audio form from such esteemed authors as Maureen Ohlhausen, Herbert Hovenkamp, Richard Gilbert, Nicholas Banasevic, Randal Picker, Giorgio Monti, Alison Jones, and William Kovacic among others. This is a convenient way for our readers to keep up with our recent and past articles on the go, in the gym, or at the beach. Algorithms Revisited Antitrust Chronicle.

June 2020 - II

Self-Preferencing What is self-preferencing? The term has entered the antitrust lexicon in the wake of recent investigations into the conduct of large technology companies. In essence, it refers to situations where a company with multiple activities uses its position in one market to favor its activities in another. But is this something new? Self-preferencing is closely related to other categories of monopolization, notably refusals to supply and discriminatory conduct. The rules governing these categories of conduct have developed over time, with decisionmakers and courts elaborating specific criteria to distinguish abusive conduct from competition “on the merits.”

June 2020 - I

Monopsony Competition law, in essence, concerns the regulation of market power, to the benefit of consumers. From their inception, the antitrust rules have therefore unsurprisingly been primarily used to rein in monopolies and cartels on the supply side. But monopolies are only one form that market power can take. Monopsonies are the flipside of monopolies: situations where market power is on the demand side, as there is only one buyer (or a limited number of buyers), but there are multiple suppliers. In the right circumstances, monopsonies are as liable as monopolies to lead to consumer harm.

May 2020 - II

Killer Acquisitions What is a killer acquisition? The term was first employed in the pharmaceutical sector to describe acquisitions by an incumbent of a competitor that threatened to launch a blockbuster drug that would undermine its own products, with a view to shutting it down. In recent times, the term has broadened to cover other industries, notably the tech sector, where companies allegedly acquire startups to acquire their technology, either to quell a nascent threat, or to integrate it to their own offerings, further entrenching their dominance.

May 2020 - I

Healthcare and competition In this Chronicle we turn to the timely issue of healthcare and competition. In light of the COVID-19 pandemic, the healthcare industry, in all its facets, including the development of pharmaceuticals, the provision of healthcare, and health insurance, has never been as vital. Antitrust rules have a key role to play to ensure that drug companies continue to innovate, vital care is provided to the public, and, above all, that patients receive the care they need.

April 2020 - II

Competition and Sports In this Chronicle we address competition and sports. All sports have layers of rules. There are the “rules of the game” itself (the size of the field, how to score points, how many players per team). Then there are the “governing rules” for the organization of competitive sports, such as league structures, financial rules, and rules on player transfers. And then there is the law. To the extent that sports constitute an economic activity, they, and their rules, are subject to the competition rules.

April 2020 - I

Antitrust Remedies Where there is a violation of the antitrust rules, there must be consequences. This can take the form of fines or damages for injured parties, but also structural or behavioral remedies designed to maintain or restore competitive conditions. Antitrust remedies have become a hot topic in recent months. Prominent politicians around the world are calling for certain technology companies to be “broken up” for alleged antitrust infringements. In parallel, there have been significant policy shifts in the U.S. as regards the correct approach to remedies in merger enforcement.

March 2020 - II

LeadershIP EU In this edition of the CPI Chronicle, we present a set of articles authored by participants in the LeadershIP EU roundtable that took place in November 2019. LeadershIP is a working group that promotes open, balanced discussion on global issues related to intellectual property and antitrust policy. Indeed, fostering innovation to the benefit of consumers is one of the key goals of both the IP and the antitrust rules. Nonetheless, the relationship between the two bodies of law is not always clear-cut, and merits detailed and nuanced discussion.

March 2020 - I

Year of the Rat: Antitrust in China This China issue starts with two CPI Talks interviews with the senior officials of the antitrust authorities in China and Hong Kong respectively. The first interview is with Mr. Zhenguo Wu, Director General of the Anti-Monopoly Bureau of the State Administration for Market Regulation (“SAMR”). The other interview is with Brent Snyder, Chief Executive Officer of the Competition Commission of Hong Kong.

February 2020 - II

In this Data, Data Everywhere... Chronicle we turn to the issue of the interaction between big data and competition. Is it a game changer? In recent years, big data has variously been discussed as the “new oil,” a barrier to entry to digital markets (and even brick and mortar sectors), or alternatively as a mere asset (albeit a new one), like any other. Yet no clear consensus has emerged. Do large datasets justify modulation of existing antitrust doctrines? Are they better regulated through bespoke regulation? Or are the existing rules sufficient? How would any of the mooted changes interact with the burgeoning growth of personal data privacy regulation? These questions, among others, have been raised in academic discussion, discourse among practitioners, and in various antitrust decisions in the past years. Yet there are, to date, no clear answers.

February 2020 - I

Antitrust Chronicle - (Disruptive) Innovation In this edition of the Chronicle, we address innovation. Fostering innovation to the benefit of consumers is widely accepted to be one of the key goals of antitrust rules. But innovation as a parameter of competition is difficult to assess. Unlike price, which can be directly quantified, innovation is by its nature speculative, and its potential effects are probabilistic at best. This is all the more so for so-called “disruptive” technological innovation that has the potential to undermine incumbents, or even redefine entire sectors of the economy.

January 2020 - II

Labor Markets Winter 2020. This edition of the Antitrust Chronicle looks at the interaction between antitrust rules and labor markets. Competition and labor rules are not obvious bedfellows. Labor regulation concerns, in its essence, collective bargaining with a view to enhance workers’ economic outcomes. By contrast, competition rules encourage rivalry with a view to enhancing consumer welfare through dynamic processes. Despite this difference in their underlying principles, the application of competition rules can nonetheless have significant impacts on labor regulation, and vice versa. Therefore, many argue that they cannot be viewed in isolation. This Chronicle brings together a set of contributions from authors around the world that discuss this interaction, in light of the specific rules (in both domains) that apply in their jurisdictions. The Winter Labor Markets Winter 2020 Antitrust Chronicle is also available to download in pdf.

January 2020 - I

Agriculture Happy New Year! We are what we eat. Farmers produce what we eat. But times are hard today for many farmers throughout the world. In the United States, for example, some farmers are going bankrupt at shocking record rates. In such an economic environment, a CPI Chronicle dedicated to agriculture and antitrust could not be more timely or relevant.