US and EC oligopoly control

Abstract:

Oligopolistic markets are those characterised by the presence of few competitors, none of which is individually in a position of market dominance, but each of which is very large. They can, when market conditions are favourable, collectively exert market power and charge supra-competitive prices without the strict observation of antitrust legislation that most modern antitrust legal systems seek to enforce. Their behaviours are categorised as tacit collusion or conscious parallelism, both of which present real challenges to antitrust authorities. Occasionally oligopolistic markets might have to turn to explicit collusion in order to reach anti-competitive outcomes. This work seeks to counter those challenges and presents a detailed examination of competition law as it battles against oligopolistic markets.
The book opens with a short overview of the main existing economic theories of oligopolies which offer an insight into the economic functioning of oligopolistically structured markets and thereby an improved understanding of the issues addressed later in the legal part of the work. Chapters then fall into two parts, ex post and ex ante.

Chapter one considers US case law under Section 1 of the Sherman Act which prohibits contracts, combination or conspiracy. The extent to which it has been interpreted to embrace tacit collusion is examined. Section 2 of the Sherman Act, which prohibits monopolisation, conspiracy to monopolise, and attempt to monopolise to control anti-competitive oligopolistic behaviour, is examined in chapter two. Prohibition of ‘unfair practices’ in Section 5 of the Fair Trade Commission Act is the focus of chapter three. Chapters four and five deal with the legislative approach ex post in the EC - chapter four dealing with the reach of the anti-cartel provision contained in 81EC and chapter five exploring the extent to which Article 82 might impact upon anti-competitive oligopolistic behaviour. Oligopolists often adopt facilitating practices to render market characteristics artificially more favourable to collusion, increasing transparency. The approaches to these facilitating practices in the US and the EC are the feature of chapters six and seven. Chapter six addresses the application of relevant US legislation, while chapter seven analyses the EC approach to such practices as provided for in Articles 81 and 82.

Part two addresses the possibility that anti-competitive oligopolistic markets might be prevented ex ante from coming into existence. Chapter eight illustrates the US approach to merger control, while chapter nine assesses the EC merger law and policy towards preventative oligopoly control.

The work will interest scholars, policy makers and practitioners engaged in the field of competition law.