Competition Law Digest

The Competition Laws in over 80 countries and international organizations.

Global Competition Law
Louis Vogel
Founding Partner, Vogel & Vogel
Professor of law, University of Paris 2 Panthéon-Assas

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As its name suggests, Global Competition Law is a Practioner’s Guide. Its aim is not to present
a scientific and exhaustive table of most of the world’s competition laws, in particular those of the
European Union and its Member States, but rather to present their salient aspects by providing the
practitioner with an overview of their structure and most characteristic elements.
For that reason, the plan employed is the same for all countries, with a few adjustments sometimes
required because of the specific nature of the laws in question; the rules relating to unfair conduct do
not feature, except where they are integrated into the country’s competition law, and those relating
to anticompetitive practices (restrictive agreements and abuse of dominant position or monopolizations)
are examined first, followed by those pertaining to the control of concentrations.
Although Global Competition Law is primarily a practical guide, it also provides some general
insights with regard to future developments.
Firstly, it is clear that the world of competition law is today divided into two groups, corresponding
to two different conceptions of competition.
The European model continues to see competition law as an instrument in the service of the State
or its institutions, and this is reflected in the fact that the administrative authorities are generally
competent in the first instance, that administrative repression is prevalent and that private actions
remain rare. These rules of enforcement exist in parallel with the somewhat rigid substantive rules –
but which are easy to apply - generally based on the principle of prohibition/exemption.
This construction can also be explained by efficiency considerations, with the detection and
punishment for infringements entrusted to the same authorities, whereas the ordinary courts in
Europe are ill-equipped and in general the judges have little training in competition issues.
In contrast, the American model places competition within society itself: courts and private parties
play the essential role, and appear to operate as veritable “private prosecutors” demanding the imposition
of sanctions, notably by way of punitive damages. The rules are more flexible and allow more
room for assessment on the merits; restrictive agreements are not prohibited – subject to exceptions
- but assessed in the light of a rule of reason; not only abuses of dominance but all acts of monopolization
are sanctioned i.e. all behaviors resulting in the creation of such position.
Looking at the facts, however, we see that the European systems have become appreciably more
relaxed and the European guidelines are looking more and more like those in force in the US,
especially in the field of merger control. On the other hand, the European laws do have a serious
disadvantage in that they confuse the functions of investigation and judgment and there is a relatively
weaker protection of the rights of defense than in the American model.
In addition, with the increase in covert anticompetitive behavior, the effectiveness of administrative
law enforcement has now been called into question and the application of competition law
increasingly left to the parties themselves; it is no coincidence that the European Commission is
planning to introduce class actions in competition law or that there has been such a rapid development
of leniency programs within European countries.
It is likely that in the future, the European systems will become more judicial-based, using specialized
courts before which private parties and administrative authorities can bring their actions.
Correlatively, political control, particularly in the area of mergers, will see its influence decline,
although the European-based laws will never seek to defend competition or favor efficiency for their
own sakes and will continue to pursue extra-competitive objectives such as the protection of jobs, the
environment, or simply, the public interest.
A change in the European model seems predictable in the short term. This reform must not be
limited to importing a few American characteristics to the existing institutions. If, in the future,
private parties can more easily claim compensation for harm suffered, there is no reason, other than
to punish the perpetrators of anticompetitive practices twice, for the State to continue to impose very
heavy administrative fines in order to repair the “damage to the economy”, as it is formulated under
French law.
As Global Competition Law demonstrates, a legal system forms a whole: in order to improve it,
it is not enough to merely incorporate the «good parts» from somewhere else; a whole new balance
must be struck.
Louis Vogel