Volume 5 - Issue 1

Whole Issue

Competition Law Review - Volume 5 Issue 1 (1.81 MB)

Editorial

Editorial - Cartel Revolution and Evolution

Angus MacCulloch (102 KB)

Articles

European and American Leniency Programmes: Two Models Towards Convergence?
Nicolo Zingales (504 KB)

This paper compares the different approaches that the United States and Europe have embraced in designing their leniency programmes. The analysis first explains the rationale underlying such programmes, sketching the economic principles upon which they rest. It follows by highlighting those crucial features that call for the utmost care in the design of the programme, and giving some recommendations by describing policies that should be embraced by the ‘ideal’ leniency programme. It recognizes, though, that each of the legal systems considered would need time and effort to adapt to the innovations suggested, and therefore urges that too far-reaching objectives not be set. It concludes, in contrast, that the key driver should be that of gradual harmonization toward the most efficient model. By assessing the ideas about rational consequent behaviour for cartel members and which programme has established better incentives to push these members forward, the article concludes envisioning a gradual shift towards the US model. Discussions throughout the paper make many suggestions, including the inclusion of a restitution obligation and the involvement of individuals, all of which should inspire the future actions of EU legislators.

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EC Dawn Raids: A Human Rights Violation?
Imran Aslam and Michael Ramsden (291 KB)

Pursuant to Regulation 1/2003 the European Commission has extensive powers to enforce and regulate competition law within the European Community. This paper examines whether the ‘Dawn Raid’ procedure, as embodied in the Regulation, is consistent with two rights protected by the European Convention on Human Rights and Fundamental Freedoms: the privilege against self-incrimination (Article 6 ECHR) and the right to privacy (Article 8 ECHR). This paper argues that the protection provided by the European Court of Justice falls far short of protection necessary to undertakings. On this basis, it will analyse what available source(s) of judicial remedy an undertaking has in order to avail itself of ECHR rights.

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Anti-Cartel Enforcement by the DOJ: An Appraisal
John M Connor (413 KB)

This article evaluates the effectiveness of the Antitrust Division of the U.S. Department of Justice with respect to criminal enforcement of Section 1 of the Sherman Act during 1990-2007. Evidence suggests that cartel penalties are sub-optimal. By all measures, the size of US fines imposed on corporate cartelists has risen since 1990, though relative to other jurisdictions and to private recoveries of damages, the Division is falling behind. Where the Division has no peer is in imposing prison sentences of individual cartel managers. However, in view of the surge in corporate leniency applications, a matter of some concern is the falling numbers of criminal price-fixing cases filed, corporations indicted and fined, and the number of cartel managers charged and fined. In part, these trends may be ascribed to a policy shifts in the early 1990s, but falling numbers may also reflect constrained resources.

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Survey of Public Attitudes to Price-Fixing and Cartel Enforcement in Britain
Andreas Stephan (308 KB)

The paper reports on results from a public survey on attitudes to collusion and cartel enforcement in Britain. Respondents demonstrate an understanding that price-fixing is harmful and should be punished. While there is strong support for high corporate fines and naming and shaming, only one in ten Britons think individuals responsible should be imprisoned. Weak perceptions of the severity of price-fixing are confirmed by only six in ten people considering such practices to be dishonest. Sex and age strongly influence attitudes. Education and newspaper readership have less of an effect, indicating poor information dissemination. Only 20 per cent would report their employer’s involvement in price-fixing without guarantees of anonymity and/or a reward; 14 per cent would not report at all for fear of potential consequences. Public opinion is divided as to whether leniency programmes are justifiable. Respondents consider public enforcement to be more important than compensating parties injured by cartels.