Monopolists Without Borders: The Institutional Challenge of International Antitrust in a Global Gilded Age

Competition Policy and Antitrust

Article Snapshot

Author(s)

Daniel Sokol

Source

Berkeley Business Law Journal, Vol. 4, pp. 37-122, 2007

Summary

This paper looks at how global trade affects competition policy.

Policy Relevance

The International Competition Network is the best place to work towards international competition policy. More trade alone cannot always protect competition; even open markets like Hong Kong have cartels.

Main Points

  • Expanded trade and open markets make conduct that harms competition and consumers on a global scale more likely. Individual nations are more likely to use competition law to harm foreign consumers or firms.

  • Typical international antitrust cases often involve cartels. More cooperation would improve enforcement.

  • Other typical cases involve mergers. Mergers can help consumers, so controls are controversial. Authorities believe they help consumers overall. International mergers affect more than one country and are hard for single countries to assess. 

  • A third type of case involves market access. Sometimes lack of foreign firms in a market is due to restraints on competition. Factors like high transport costs may play a role.
    • “Chicago School” economists in the United States argue that large firms often help consumers. Some question if this holds in poorer countries.  Competition law can’t address anti-competitive regulations.

  • International competition policy entails issues of cost, complexity, legitimacy, and accessibility to people, firms, and nations (“participation”). Options include:
    • Binding agreements (“hard law”) leading to competition-related cases adjudicated at the WTO.
    • Consensus-based nonbinding rules and networks (“soft law”) like the OECD. The International Competition Network is the best forum.

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