8 July 2016
on course website
European Competition Law and Economics: Cartels and Other Evils
This course deals with the effects of European Competition Law on the behavior of businesses in EU countries. An effective common market within the EU requires fair and undistorted competition. Hence the Treaty on the Functioning of the European Union ?TFEU? includes strict rules to tackle unfair competition. As an extremely broad concept of the law, section 101 TFEU, for example, stipulates that ?All agreements, decisions by associations of companies and concerted practices, which have as their object or effect, either actual or potential, the prevention, restriction or distortion of competition, are prohibited.?
Consequently, the European Commission' DG Competition vigorously attacks cartels within the European Union. According to its own view, cartels are highly detrimental for the following reason: ?A cartel is a group of similar, independent companies which joint together to fix prices, to limit production or to share markets or customers between them. Instead of competing with each other, cartel members rely on each other?s agreed course of action, which reduces their incentives to provide new or better products and services at competitive prices. As a consequence, their clients (consumers or other businesses) end up paying more for less quality.?
A recent example of a cartel is the ?cooperation? between seven international groups of companies ? Chungwa, LG Electronics, Philips, Samsung SDI, Panasonic, Toshiba, MTPD (currently a Panasonic subsidiary) and Technicolor (formerly Thomson) ?which fixed prices, shared markets, allocated customers between themselves and restricted their output for almost ten years, between 1996 and 2006. In this case the European Commission imposed a total fine of ? 1.47 billion in 2012.
In another case, the European Commission found that Lut?ce, Prochamp and Bonduelle participated in a cartel to coordinate prices and allocate customers of canned mushrooms in Europe and imposed fines totalling ? 32 225 000. Lut?ce benefited from immunity under the Commission' 2006 Leniency Notice for revealing the existence of the cartel to the Commission.
However, the central theme in this course is the public enforcement of European competition law. The aim is to give students insights into how unfair competition occurs in practice, how this can be prevented and how to react if unfair competition is detected within a company. During the last day of the course, students will have to present a paper in which they will have to comment on (the effects of) a particular cartel.
Some cases also raise the fundamental question whether the European Competition authority should consider the possibility that competition will be diminished because of the detrimental effect of a fine imposed by the Competition Authority. For example, Europe?s biggest shrimp company Heiploeg was declared bankrupt after a ? 27m fine for its role in a large European shrimp cartel. Another question that will be dealt with in this course is whether a high fine of the Competition Authority might hinder the possibilities of individual claimants to recoup the damage which they suffered because of the Cartel.
prof. dr. A. Gerbrandy (professor of Competition Law)
Ambitious bachelor and master students (law, economics) who are keen to know more about the public enforcement of European Competition Law and compliance with anti-trust rules.
To give advanced bachelor and master students (Law, Economics) an insight into the backgrounds of the public enforcement of European Competition law and its effects on the behavior of businesses, and vice versa, and to make them familiar with the career opportunities after a Master in Law & Economics or Economics & Law. This course is also an excellent introduction to the course Competition Law in de Master Law & Economics of Utrecht University.
EUR 785: Course + course materials + housing
EUR 585: Course + course materials
on course website