Notes Comp Law
Thursday, 2 March 2023 23:40
Competition Law and Policy in the EU and UK
Chapter 1 – Introduction to Competition Policy and Practice OVERVIEW
Concerns intervention in a market where there is a ‘market failure’:
through the action of either a monopolist, an anti-competitive
agreement, or merger.
Concerns stem from neoclassical economic model of monopoly (referred
to as the ‘pure competition objective’) which indicates that a monopolist can
exploit its position to earn a supra-competitive profit at the expense of
consumer welfare. A profit-maximising monopolist would reduce output
to increase prices, and reduce allocative and productive efficiency,
which this behaviour would create a deadweight loss for the whole
economy.
May feature a range of policy objectives, which can be employed alongside
the core economic concern of consumer welfare. These include;
concentration of economic power, wealth distribution, consumer protection,
regional policy and market integration.
All competition regimes have their own historical and social context which
shapes them. Each regime can only be understood in that context as policy
develops over time, affected by the changing economic and political
climate in each jurisdiction.
EU AND UK
UK business still have to comply with EU competition law when involved in
trades with any part of EU. Usually enforced by national or EU regulatory
authorities intervening in markets, developments were made encourage
private enforcement of competition laws through regular court process. (still
the norm). Also interested in business with smaller, but still significant,
market shares which enable such business to have power or influence over
the market. Hard to associate competition law with law of contract or delict
as they rely mainly on adjudication through the courts. Not concerned with
shareholders welfare or interests.
COMPETITION LAW BACKGROUND
,
, market shares which enable such business to have power or influence over
the market. Hard to associate competition law with law of contract or delict
as they rely mainly on adjudication through the courts. Not concerned with
shareholders welfare or interests.
COMPETITION LAW BACKGROUND
Competition law concerns intervention in the marketplace, when there is
some problem with the competitive process, or when there is ‘market
failure’.
Firstly, public authority intervention has traditionally been the dominant
mode of competition law enforcement. However, although competition law
has been generally enforced administratively by National or European
Union regulatory authorities intervening in markets, there has been a more
recent development, towards private enforcement of competition law,
through regular court processes. Nonetheless, it is difficult to equate
competition law with other areas of law, such as law of contract or
delict/tort, which rely almost executively on adjudication by normal court
processes. Administrative enforcement of competition law is currently still
the norm, although we have to be aware of developments in private
enforcement of competition law ‘rights’ in the courts, particularly following
‘modernisation’ of European Union law, and recent reforms of UK
competition law.
Secondly, the broad definition does not clarify exactly what kinds of ills
competition law seeks to remedy. One should assess what is meant by a
failure in competition or the competitive process. We must ask whether all
systems of competition law consider the same types of conduct or market
result to be a ‘market failure’ and anti-competitive. The basic answer is no.
MONOPOLY
lOMoARcPSD|19373849
In economic terms, a monopoly is a market which one company or
business controls 100% of the market, which in practice is very
rare. Competition law is also interested in businesses with smaller, but still
significant, market shares, which enable such businesses to have power
of influence over the market.
The term adopted in EU law and the Competition Act 1998, is that of an
‘undertaking’ with a ‘dominant passion’, whereas s.2 of the Sherman Act
1890 in the USA applies to ‘every person who shall monopolise, or attempt
to monopolise’ trade or commerce.
The general concern in these situations is that the ‘monopolist’ will exploit
its power over the market, and act anti-competitively.
CARTELS
This is a non-technical term for various forms of co-operation between
companies, which may be prohibited by competition law.
Thursday, 2 March 2023 23:40
Competition Law and Policy in the EU and UK
Chapter 1 – Introduction to Competition Policy and Practice OVERVIEW
Concerns intervention in a market where there is a ‘market failure’:
through the action of either a monopolist, an anti-competitive
agreement, or merger.
Concerns stem from neoclassical economic model of monopoly (referred
to as the ‘pure competition objective’) which indicates that a monopolist can
exploit its position to earn a supra-competitive profit at the expense of
consumer welfare. A profit-maximising monopolist would reduce output
to increase prices, and reduce allocative and productive efficiency,
which this behaviour would create a deadweight loss for the whole
economy.
May feature a range of policy objectives, which can be employed alongside
the core economic concern of consumer welfare. These include;
concentration of economic power, wealth distribution, consumer protection,
regional policy and market integration.
All competition regimes have their own historical and social context which
shapes them. Each regime can only be understood in that context as policy
develops over time, affected by the changing economic and political
climate in each jurisdiction.
EU AND UK
UK business still have to comply with EU competition law when involved in
trades with any part of EU. Usually enforced by national or EU regulatory
authorities intervening in markets, developments were made encourage
private enforcement of competition laws through regular court process. (still
the norm). Also interested in business with smaller, but still significant,
market shares which enable such business to have power or influence over
the market. Hard to associate competition law with law of contract or delict
as they rely mainly on adjudication through the courts. Not concerned with
shareholders welfare or interests.
COMPETITION LAW BACKGROUND
,
, market shares which enable such business to have power or influence over
the market. Hard to associate competition law with law of contract or delict
as they rely mainly on adjudication through the courts. Not concerned with
shareholders welfare or interests.
COMPETITION LAW BACKGROUND
Competition law concerns intervention in the marketplace, when there is
some problem with the competitive process, or when there is ‘market
failure’.
Firstly, public authority intervention has traditionally been the dominant
mode of competition law enforcement. However, although competition law
has been generally enforced administratively by National or European
Union regulatory authorities intervening in markets, there has been a more
recent development, towards private enforcement of competition law,
through regular court processes. Nonetheless, it is difficult to equate
competition law with other areas of law, such as law of contract or
delict/tort, which rely almost executively on adjudication by normal court
processes. Administrative enforcement of competition law is currently still
the norm, although we have to be aware of developments in private
enforcement of competition law ‘rights’ in the courts, particularly following
‘modernisation’ of European Union law, and recent reforms of UK
competition law.
Secondly, the broad definition does not clarify exactly what kinds of ills
competition law seeks to remedy. One should assess what is meant by a
failure in competition or the competitive process. We must ask whether all
systems of competition law consider the same types of conduct or market
result to be a ‘market failure’ and anti-competitive. The basic answer is no.
MONOPOLY
lOMoARcPSD|19373849
In economic terms, a monopoly is a market which one company or
business controls 100% of the market, which in practice is very
rare. Competition law is also interested in businesses with smaller, but still
significant, market shares, which enable such businesses to have power
of influence over the market.
The term adopted in EU law and the Competition Act 1998, is that of an
‘undertaking’ with a ‘dominant passion’, whereas s.2 of the Sherman Act
1890 in the USA applies to ‘every person who shall monopolise, or attempt
to monopolise’ trade or commerce.
The general concern in these situations is that the ‘monopolist’ will exploit
its power over the market, and act anti-competitively.
CARTELS
This is a non-technical term for various forms of co-operation between
companies, which may be prohibited by competition law.
