Arndt Christiansen

Competence Allocation in the EU Competition Policy System as an Interest-Driven Process

This paper provides a positive analysis of the evolution of competence allocation within the EU Competition Policy System. In the EU, competition policy competences are ascribed both to the European level and to each Member State. In regard to securing a sound antitrust system, the allocation and delimitation of these competences plays an important role. Accordingly, competence allocation has been a major issue in the recent reforms of cartel policy enforcement and merger control. Instead of normatively analysing the characteristics of optimal competence allocation, we positively identify the self-interest of the interacting groups of agents (European Commission and Courts, national authorities, business associations) as a major-driving force of the reform process. We show that, as a consequence, the interest-driven outcomes of this process are largely ineffective and deficient - even if evaluated against the background of the publicly-announced reform goals. This stands in accordance with longer-term patterns in competence allocation evolution in the EU Competition Policy System.

The Analysis of Coordinated Effects in EU Merger Control: Where Do We Stand after Sony/BMG and Impala?

The recent Impala Judgment by the CFI on the Sony/BMG Decision by the Commission represents the most important ruling on collective dominance since Airtours. We review both the Decision and the Judgment and derive implications for the institutional and substantive development of EU Merger Control. Firstly, Impala introduces an ambitious symmetric standard of proof for prohibition and clearance decisions by the Commission. While alleviating fears of an increasing number of false positives in the aftermath of Airtours, this entails the problem of how to deal with cases in which neither the existence, nor the absence of anticompetitive effects can be proven to the required standard. Secondly, the ongoing process of increasing the role of third parties in European Merger Control is fuelled. Thirdly, Impala has the potential to herald a comeback of coordinated effects analysis, further precising the conditions for establishing this kind of anticompetitive effect. Additionally, given the characteristics of the music industry, we criticise a lack of in-depth economic analysis of non-price competition issues, such as innovations and product diversity.

Aktuelle Reformen in der Europäischen Wettbewerbspolitik

Mit der Vollendung des Gemeinsamen Marktes in der Europäischen Union und der Internationalisierung der Wirtschaftsbeziehungen hat sich die Wettbewerbspolitik zunehmend von der nationalen auf die europäische Ebene verlagert. Die wesentlichen Bestimmungen sind dabei seit ihrer Einführung (Kartellverbot 1957, Durchführungsverordnung 1962, Fusionskontrolle 1989) weitgehend unverändert geblieben (Überblick bei Schmidt, 2001, S. 225 ff.). In den letzten Jahren jedoch hat die Europäische Kommission, Generaldirektion Wettbewerb, als Trägerin der europäischen Wettbewerbspolitik eine umfangreiche Reformdiskussion angestoßen, deren Abschluss die neue Kartellverordnung von Januar 2003 und die neue Fusionskontrollverordnung (FKVO) von Januar 2004 bilden, die beide am 01.05.2004 in Kraft getreten sind. Wir geben einen kritischen Überblick über diese jüngsten Reformen.

Simulating the (Unilateral) Effects of Mergers: Implications of the Oracle/PeopleSoft Case

Unilateral effects analysis has been the single most important innovation in merger control driven by economic theory in recent years. In practice, this requires the use of sophisticated economic tools such as simulation models, which facilitate the quantification of short-term merger effects. In this paper, we study the application of this new device in the landmark merger case between software firms Oracle and PeopleSoft. Despite serious initial concerns the transaction was not blocked, nor even required to be modified in the EU and US. Besides some case-specific issues we highlight the fundamental problems associated with the use of sophisticated economic tools in merger control. The basic questions are: (i) What can merger simulation models actually demonstrate? (ii) What is an adequate standard of proof for their sensible use in merger review? Based on the nature of predictive economic evidence we then develop an adequate standard of proof, i.e. the evidentiary threshold that must be met for a prohibition decision. For a more general treatment we also present a simple analytical model in order to illustrate the effects of different thresholds on legal and economic quality. Finally, our recommendation is to adjust the standard of proof in the direction of a moderate threshold or, more preferably, to switch to a mixed burden of proof. Both suggestions are geared to guaranteeing the fruitful contribution of sophisticated economic evidence to case assessments and, thus, increasing decision quality.

The Analysis of Coordinated Effects in Eu Merger Control: Where Do We Stand After Sony/Bmg and Impala?

On 13 July 2006, the Court of First Instance (CFI) in Impala v Commission1 annulled the European Commission’s Sony/BMG Decision.2 This was a surprising and remarkable development for several reasons.3 The CFI for the first time reversed an unconditional clearance decision by the Commission under the EC Merger Regulation (ECMR). Secondly, the Impala ruling represents the most important collective dominance (or coordinated effects as they are now termed) case since Airtours. Thirdly, the CFI proceedings were initiated by competitors of the newly created joint venture, namely The Independent Music Publishers and Labels Association (Impala).4 Moreover, the original Decision had already been remarkable in and of itself. For one thing, the Commission opted for an unconditional clearance despite serious initial doubts. Then the Commission conducted a comprehensive analysis of past price data, thus providing another application of the quantitative techniques characteristic of the recent “more economic December 2006 European Competition Journal 311