Moving the trade and competition debate forward

Journal of International Economic Law

Volumn 4, Issue 3, 2001, Pages 481-506

  Bercero, Ignacio Garcia ^a   Amarasinha, Stefan D ^a  

^a NONE

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EID: 0035599691     PISSN: 13693034     EISSN: None     Source Type: Journal    
DOI: 10.1093/jiel/4.3.481     Document Type: Article

References (54)

1. The 'UNCTAD 2000 World Investment Report - Cross-border Mergers and Acquisitions and Development' (United Nations 2000) provides interesting and detailed information about recent trends and figures in mergers and acquisitions. For these merger cases, see EC Commission decisions Case No COMP/M.1845 - AOL-TIME WARNER, decision of 11 October 2000 and Case No IV/ M. 1204 - DAIMLER - BENZ/CHRYSLER, decision of 22 July 1998, the latter published in Official Journal C 252, 11 August 1998 at 0008.
2. For a comprehensive compilation of views on the issue of trade and competition and the WTO, see Roger Zäch (ed), Towards WTO Competition Rules - Key Issues and Comments on the WTO Report (1998) on Trade and Competition (Kluwer Law International 1999).
3. Cases T-395/94R and C-149/95P [1993] 5 CMLR 446; [1997] 5 CMLR 167.
4. For a comprehensive description of the Vitamins Cartel, see Margaret Levenstein and Valerie Suslow, 'Private International Cartels and Their Effect on Developing Countries', Background Paper for the World Bank's World Development Report 2001, 9 January 2001, at 51-61. The Article can be found on the web site http://www-unix.oit.umass.edu/-maggiel/WDR2001.pdf (visited 11 June 2001).
5. or a comprehensive description of the Graphite Electrodes Cartel see Margaret Levenstein and Valerie Suslow, 'Private International Cartels and Their Effect on Developing Countries', Background Paper for the World Bank's World Development Report 2001, 9 January 2001, at 31-40. The Article can be found on the web site http://www-unix.oit.umass.edu/-maggiel/WDR2001.pdf (visited 11 June 2001).
6. All cases are also contained in the OECD 2000 Hard Core Cartel Report, at 24, 16, and 13. Full text of the 2000 Hard Core Cartel Report is available on the official OECD web site http:// www.oecd.org/daf/clp/CLP_reports/hcc-e.pdf (visited 10 May 2001).
7. OECD 2000 Hard Core Cartel Report, http://www.oecd/org/daf/clp/CLP_reports/hcc-e.pdf (visited 10 May 2001).
8. OECD 2000 Hard Core Cartel Report, http://www.oecd/org/daf/clp/CLP_reports/hcc-e.pdf (visited 10 May 2001), at 12.
9. OECD 2000 Hard Core Cartel Report, http://www.oecd/org/daf/clp/CLP_reports/hcc-e.pdf (visited 10 May 2001), at 12.
10. See 'International Competition Policy Advisory Committee' Final Report US Department of Justice Antitrust Division 2000, p 42.
11. '87 of the WTO's 140 Members have competition regimes, of which more than half are less than 10 years old', COM/TD/DAFFE/CLP(2001)21, at 11.
12. Note, however, that most countries as well as the EC do apply their competition laws to conduct with an impact on their territory on the basis of the effects or implementation doctrines. The effects doctrine was confirmed by the US Supreme Court in Hartford Fire Insurance Co v California, 113 S Ct 2891 (US Supreme Court 1993). For a commentary on this decision, see Andreas F. Lowenfeld, 'Conflict, Balancing of Interests, and the Exercise of Jurisdiction to Prescribe: Reflections on the Insurance Antitrust Case', Am J Int'l L 89, at 42.
13. See also Financial Times, 'Trade Controls: Mergers "Hit by Maze of Regulations"' (5 January 2000).
14. See above n 4.
15. See above n 3.
16. For an interesting take on global corporations, ownership and control, see Robert B. Reich, 'Who Is Us?', Harvard Business Review (January/February 1990). See also the reply to Reich by Ethan Kapstein, 'We Are US: The Myth of the Multinational', National Interest 26 (Winter 1991/1992).
17. For an interesting take on global corporations, ownership and control, see Robert B. Reich, 'Who Is Us?', Harvard Business Review (January/February 1990). See also the reply to Reich by Ethan Kapstein, 'We Are US: The Myth of the Multinational', National Interest 26 (Winter 1991/1992).
18. Chapter V dealt with six types of anti-competitive practices, namely: (i) price fixing and other related practices; (ii) exclusion of enterprises from markets or allocation of markets and customers and fixing sales and purchase quotas; (iii) discrimination against certain enterprises; (iv) output restrictions and quotas; (v) agreements preventing the development and use of patented or unpatented technology and inventions; and (vi) certain extensions of the use of rights under patents, trademarks, or copyrights.
19. WT/DS44/R.
20. For an analysis of the Kodak-Fuji case, see, e.g., Mark Furse, 'Competition Law and the WTO Report: "Japan - Measures Affecting Consumer Photographic Film and Paper"', European Common Market Law Reports (1999), at 9.
21. See Press Releases of the United States Trade Representative 'U.S. to request WTO consultations with Mexico regarding Telecommunications trade barriers', 28 July 2000, and 'United States to request WTO Panel on Mexico Telecommunications', 8 November 2000, available on the USTR web site at http://www.ustr.gov/releases/2000 (visited 11 June 2001).
22. The Working Group is meeting under the able Chairmanship of Professor Frederic Jenny, Vice Chair, Conseil de la Concurrence, France.
23. See document WT/WGTCP/2.
24. The current basis of the group's continued work is the decision of the WTO General Council taken in December 1998. The General Council decided that the group should continue its work and that discussions could focus on (i) the relevance of the fundamental WTO principles of national treatment, transparency, and most-favoured-nation treatment to competition policy and vice versa; (ii) approaches to promoting cooperation and communication among Members, including in the field of technical cooperation; and (iii) the contribution of competition policy to achieving the objectives of the WTO, including the promotion of international trade. See document WG/WGTCP/2.
25. The 1999 and 2000 reports of the Working Group contain detailed accounts of the discussions under the three main headings set out in the 1998 General Council Decision. See documents WT/ WGTCP/3 and WT/WGTCP/4.
26. For a discussion of the development dimension of competition law and policy, see communication from the EC and its Member States, WT/WGTCP/W/140.
27. This is clearly reflected in the Plan of Action that emerged from the UNCTAD X conference, which states that 'RBPs [restrictive business practices] should not impede or negate the realization of benefits arising from the liberalization of tariff and non-tariff barriers affecting world trade, particularly those affecting the trade and development of developing countries . . ., and, '. . . there is a need to prevent enterprises from re-establishing market barriers where governmental controls have been removed.' TD(X)BKK. 182, at para 70.
28. See communication from Argentina, WT/WGTCP/W/63.
29. See communication from Argentina, WT/WGTCP/W/63. For the example of Korea, see WT/ WGTCP/W/56.
30. See WT/WGTCP/M/3, at para 58.
31. It is noteworthy in this respect that some of the development challenges that developing countries and - in particular least-developed - face may be attributable (wholly or partially) to the lack of functioning markets which, of course, ties in with the lack of competition and competition policy. See Frederic Jenny and Robert Anderson, 'Internal Reform as a Necessary Condition for Realizing the Benefits of Trade Liberalization: the Case of Regulatory Reform and Competition Policy', paper prepared for the Integrated Framework Seminar on Policy Relevance of Mainstreaming Trade into Country Development Strategies, 29 January 2001, on file with the authors of this article.
32. One important aspect of sound competition laws that should not be neglected is that it can be an important factor for improving the attractiveness of an economy to foreign investors by creating a transparent and non-discriminatory legal framework.
33. See WTO Report (2000), particularly paras 23 to 89.
34. See Communication from the EC and its Member States of 25 September 2000 (WT/WGTCP/W/ 152). See also Communication from EC and its Member States of 14 March 2001 (WT/WGTCP/ W/160), which discussed several questions raised in connection to the prior Communication. References throughout this article to the EU position on 'Trade and Competition' refer to the Communications presented to the WTO Working Group in September 2000 and March 2001. See also Communication from the EC and its Member States of 3 July 2001 summarizing the main arguments in favour of a WTO Competition Agreement (WT/WGTCP/W/175).
35. OECD Joint Group on Trade and Competition, 'Outline of: (a) Core principles, common approaches and common standards and (b) Bilateral and Multilateral approaches' OLIS 12 October 1999, COM/TD/DAFFE/CLP(98)97 final.
36. Recommendation of the Council concerning effective action against hard-core cartels C/M(98)7 PROV adopted 25 March 1998.
37. The EU position is reflected in the Communications presented to the WTO working group in September 2000, March 2001, and July 2001, see n 33. Discussion in the OECD joint trade and competition group has dedicated much attention to the issue of possible 'common approaches' or 'common standards' in different areas of substantive competition law, such as vertical restraints. See above n 24. The general understanding was, however, that - except in the case of hard-core cartels -it would be difficult to agree on common standards or even more flexible common approaches, at least within a short period of time.
38. Agreement between the EC and the Government of the United States of America on the application of positive comity principles in the enforcement of their competition laws. OJ L173 of 18/06/1993. Europa.eu.int.
39. See WT/WGTCP/4 paras 61 and 62 and WT/WGTCP/3 paras 60 and 61.
40. Since before Seattle, the WTO has been discussing a new strategy for an enhanced and better-coordinated approach to technical assistance for capacity building. This would apply both to the implementation of existing agreements and in relation to possible new agreements. It is interesting to note that, for instance, in the case of the customs valuation agreement, a number of countries have obtained an extension of the transition periods provided under the agreement. This was done on the basis of the presentation of a work programme indicating the concrete steps required to fully implement the agreement and how these were being addressed through technical cooperation. The Customs Valuation Committee is currently discussing how to enhance its role in monitoring technical assistance programmes.
41. The reader interested in further pursuing this question may wish to consult, inter alia: Ignacio Garcia Bercero, 'Functioning of the WTO System: Elements for Possible Institutional Reform', 4 International Trade Law & Regulation (2000); Sylvia Ostry, 'WTO: Institutional Design for Better Governance', paper presented at the Centre for Business and Government at Harvard University, June 200; Marco Bronckers, 'More Power to WTO?', JIEL 4(1) (2001) 41-65; John H. Jackson, '"The WTO Constitution" and Proposed Reforms: Seven "Mantras" Revisited', JIEL 4(1) (2001) 67-78.
42. The reader interested in further pursuing this question may wish to consult, inter alia: Ignacio Garcia Bercero, 'Functioning of the WTO System: Elements for Possible Institutional Reform', 4 International Trade Law & Regulation (2000); Sylvia Ostry, 'WTO: Institutional Design for Better Governance', paper presented at the Centre for Business and Government at Harvard University, June 200; Marco Bronckers, 'More Power to WTO?', JIEL 4(1) (2001) 41-65; John H. Jackson, '"The WTO Constitution" and Proposed Reforms: Seven "Mantras" Revisited', JIEL 4(1) (2001) 67-78.
43. The reader interested in further pursuing this question may wish to consult, inter alia: Ignacio Garcia Bercero, 'Functioning of the WTO System: Elements for Possible Institutional Reform', 4 International Trade Law & Regulation (2000); Sylvia Ostry, 'WTO: Institutional Design for Better Governance', paper presented at the Centre for Business and Government at Harvard University, June 200; Marco Bronckers, 'More Power to WTO?', JIEL 4(1) (2001) 41-65; John H. Jackson, '"The WTO Constitution" and Proposed Reforms: Seven "Mantras" Revisited', JIEL 4(1) (2001) 67-78.
44. The reader interested in further pursuing this question may wish to consult, inter alia: Ignacio Garcia Bercero, 'Functioning of the WTO System: Elements for Possible Institutional Reform', 4 International Trade Law & Regulation (2000); Sylvia Ostry, 'WTO: Institutional Design for Better Governance', paper presented at the Centre for Business and Government at Harvard University, June 200; Marco Bronckers, 'More Power to WTO?', JIEL 4(1) (2001) 41-65; John H. Jackson, '"The WTO Constitution" and Proposed Reforms: Seven "Mantras" Revisited', JIEL 4(1) (2001) 67-78.
45. See Daniel K. Tarullo, 'Norms and Institutions in Global Competition Policy', 94 Am J Int'l L (2000). The article refers on several occasions to the proposals presented by the EU for a WTO Competition Agreement. References are based, however, on documents presented before the Seattle Ministerial Conference and do not, therefore, reflect the evolution of the EU position, as presented for instance in the submission to the WTO of September 2000, above n 23.
46. See Frederic Jenny and Robert Anderson, above n 20. The authors also refer to an important contribution by Nancy Birdsall and R. Z. Laurence, 'Deep Integration and Trade Agreements: Good for Developing Countries?', in Kaul et al., Global Public Goods: International Co-operation in the 21st century (New York: Oxford University Press 1999).
47. For instance Tarullo, see above n 29, at 483 indicates 'Trade negotiations - especially in recent years - tend to stress the result of effective access (i.e. sales) rather than the relative competitiveness of the market in an economic or antitrust sense.'
48. Already in 1987, the Panel report on 'US-taxes on petroleum and certain imported substances' (34 BISD 136, 17 June 1987) made clear that the rationale of Article III.2 was not to protect expectations on export volumes, and stated: 'Article III: 2, first sentence, cannot be interpreted to protect expectations on export volumes; it protects expectations on the competitive relationship between imported and domestic products'. This jurisprudence has been reiterated in many subsequent WTO dispute settlement cases, including in relation to WTO provisions other than Article III.
49. This argument is developed by Edward M. Graham in 'The relationship between international trade policy and competition policy', at 176. Copy of article distributed in WTO Seminar on Competition Policy, on file with the authors of this article.
50. Bernard Hoekman and Peter Holmes, 'Competition Policy, Developing Countries and the WTO', World Bank (1999).
51. There are many points in common between the proposals presented by the EU and the ideas presented by Professor Eleanor M. Fox on the scope of a possible WTO competition agreement. See, for instance, E. M. Fox, 'Competition Law and the Millennium Round' JIEL 3(3) (1999) 665-79. An area of difference is that the EU proposals give particular emphasis to cooperation provisions and argue that these should not be limited to practices with an impact on market access.
52. The European Commissioner for Competition, Mario Monti, has also proposed the launch of a global competition initiative, which would complement and support negotiations of a WTO agreement (see the 'EU Views on Global Competition Forum', Mario Monti - ABA meetings. Washington 29/3/2001. Europa.eu.int). The initiative would provide an exchange of experiences among competition authorities. Indeed, it may well be that further discussions on international antitrust issues not covered by WTO negotiations could facilitate future consideration of such topics by the WTO Competition Policy Committee, to be established after the conclusion of a WTO agreement.
53. It should be noted, however, that certain existing WTO provisions could give rise to similar difficulties. For instance, Article 2.2 of the TBT agreement provides that 'technical regulations shall not be more trade restrictive than necessary to fulfil a legitimate objective, taking account of the risks no fulfilment would create'. The application of such a provision to particular regulation is likely to require a complex legal and factual assessment. Moreover, the issues involved are hardly less sensitive than those involved in a competition case. So far, no WTO panel has ruled on the application of this provision.
54. See Communication to the WTO Working Group of March 2001, n 33.