Modern competition law Competition law

1 modern competition law

1.1 united states antitrust
1.2 european union law
1.3 india
1.4 international expansion

modern competition law

while development of competition law stalled in europe during late 19th century, in 1889 canada enacted considered first competition statute of modern times. act prevention , suppression of combinations formed in restraint of trade passed 1 year before united states enacted famous legal statute on competition law, sherman act of 1890. named after senator john sherman argued act not announce new principle of law, applies old , recognised principles of common law.

united states antitrust


senatorial round house thomas nast, 1886

the sherman act of 1890 attempted outlaw restriction of competition large companies, co-operated rivals fix outputs, prices , market shares, through pools , later through trusts. trusts first appeared in railroads, capital requirement of railroad construction precluded competitive services in scarcely settled territories. trust allowed railroads discriminate on rates imposed , services provided consumers , businesses , destroy potential competitors. different trusts dominant in different industries. standard oil company trust in 1880s controlled number of markets, including market in fuel oil, lead , whiskey. vast numbers of citizens became sufficiently aware , publicly concerned how trusts negatively impacted them act became priority both major parties. primary concern of act competitive markets should provide primary regulation of prices, outputs, interests , profits. instead, act outlawed anticompetitive practices, codifying common law restraint of trade doctrine. prof rudolph peritz has argued competition law in united states has evolved around 2 conflicting concepts of competition: first of individual liberty, free of government intervention, , second fair competitive environment free of excessive economic power. since enactment of sherman act enforcement of competition law has been based on various economic theories adopted government.

section 1 of sherman act declared illegal every contract, in form of trust or otherwise, or conspiracy, in restraint of trade or commerce among several states, or foreign nations. section 2 prohibits monopolies, or attempts , conspiracies monopolize. following enactment in 1890 court applies these principles business , markets. courts applied act without consistent economic analysis until 1914, when complemented clayton act prohibited exclusive dealing agreements, particularly tying agreements , interlocking directorates, , mergers achieved purchasing stock. 1915 onwards rule of reason analysis applied courts competition cases. however, period characterized lack of competition law enforcement. 1936 1972 courts application of anti-trust law dominated structure-conduct-performance paradigm of harvard school. 1973 1991, enforcement of anti-trust law based on efficiency explanations chicago school became dominant, , through legal writings such judge robert bork s book antitrust paradox. since 1992 game theory has been used in anti-trust cases.

european union law

competition law gained new recognition in europe in inter-war years, germany enacting first anti-cartel law in 1923 , sweden , norway adopting similar laws in 1925 , 1926 respectively. however, great depression of 1929 competition law disappeared europe , revived following second world war when united kingdom , germany, following pressure united states, became first european countries adopt fledged competition laws. @ regional level eu competition law has origins in european coal , steel community (ecsc) agreement between france, italy, belgium, netherlands, luxembourg , germany in 1951 following second world war. agreement aimed prevent germany re-establishing dominance in production of coal , steel felt dominance had contributed outbreak of war. article 65 of agreement banned cartels , article 66 made provisions concentrations, or mergers, , abuse of dominant position companies. first time competition law principles included in plurilateral regional agreement , established trans-european model of competition law. in 1957 competition rules included in treaty of rome, known ec treaty, established european economic community (eec). treaty of rome established enactment of competition law 1 of main aims of eec through institution of system ensuring competition in common market not distorted. 2 central provisions on eu competition law on companies established in article 85, prohibited anti-competitive agreements, subject exemptions, , article 86 prohibiting abuse of dominant position. treaty established principles on competition law member states, article 90 covering public undertakings, , article 92 making provisions on state aid. regulations on mergers not included member states not establish consensus on issue @ time.

today, treaty of lisbon prohibits anti-competitive agreements in article 101(1), including price fixing. according article 101(2) such agreements automatically void. article 101(3) establishes exemptions, if collusion distributional or technological innovation, gives consumers fair share of benefit , not include unreasonable restraints risk eliminating competition anywhere (or compliant general principle of european union law of proportionality). article 102 prohibits abuse of dominant position, such price discrimination , exclusive dealing. article 102 allows european council regulations govern mergers between firms (the current regulation regulation 139/2004/ec). general test whether concentration (i.e. merger or acquisition) community dimension (i.e. affects number of eu member states) might impede effective competition. articles 106 , 107 provide member state s right deliver public services may not obstructed, otherwise public enterprises must adhere same competition principles companies. article 107 lays down general rule state may not aid or subsidize private parties in distortion of free competition , provides exemptions charities, regional development objectives , in event of natural disaster.

india

india responded positively opening economy removing controls during economic liberalisation. in quest of increasing efficiency of nation s economy, government of india acknowledged liberalization privatization globalization era. result, indian market faces competition within , outside country. led need of strong legislation dispense justice in commercial matters , competition act, 2002 passed. history of competition law in india dates 1960s when first competition law, namely monopolies , restrictive trade practices act (mrtp) enacted in 1969. after economic reforms in 1991, legislation found obsolete in many aspects , result, new competition law in form of competition act, 2002 enacted in 2003. competition commission of india, quasi judicial body established enforcing provisions of competition act.

international expansion

by 2008 111 countries had enacted competition laws, more 50 percent of countries population exceeding 80,000 people. 81 of 111 countries had adopted competition laws in past 20 years, signaling spread of competition law following collapse of soviet union , expansion of european union. competition authorities of many states closely co-operate, on everyday basis, foreign counterparts in enforcement efforts, in such key area information / evidence sharing.

in many of asia s developing countries, including india, competition law considered tool stimulate economic growth. in korea , japan, competition law prevents forms of conglomerates. in addition, competition law has promoted fairness in china , indonesia international integration in vietnam. hong kong s competition ordinance came force in year 2015.