ON-TOPIC: COMPETITION POLICY - ECONOMIC ANALYSIS - HEALTH CRISIS - COVID-19 - STATE AID - MERGERS - COOPERATION

Competition law and health crisis

The unexpected shock provoked by the Covid-19 crisis and the measures taken to limit the spread of the pandemic have affected the functioning of many markets. Throughout the world, competition authorities which, in the last decade, had been enforcing their laws in the context of steady economic growth have had to adjust their enforcement practices not only to the difficulties of running their operations due to lockdowns but more importantly to adjust to collapsing markets or markets for essential goods characterized by severe shortages, in a context of deep economic depression with many firms facing severe liquidity constraints or even the threat of bankruptcy. Competition authorities have responded to these extraordinarily brutal circumstances by adjusting their enforcement priorities, exempting certain forms of cooperation, relaxing their standards for efficiency defence, adopting emergency procedures, allowing state aids under certain conditions, accepting mergers because the target had all of a sudden become a failing firm etc…. while at the same time insisting that these changes did not mean a weakening or an alteration of the competition law principles that they previously followed. This set of articles describes in detail the responses of a number of competition authorities, analyzes the differences in the responses of various governments and competition authorities to the Covid-19 crisis and discusses whether these responses imply a departure from the traditionally accepted goals and enforcement principles of competition.

The set of articles below is introduced by Frédéric Jenny (ESSEC Business School); other contributions have been ordered in alphabetical order of first contributor.

Introduction Frédéric Jenny Professor of Economics, ESSEC Business School, Cergy 1. The Covid-19 economic crisis is fundamentally different from the 2008 financial and economic crisis in various respects. As Marcel Boyer [1] reminds us: the financial crisis was caused by the gaming of poorly designed incentive mechanisms and a collapse of interbank confidence because of free riding and fraud. The current crisis is caused by a cataclysmic exogenous shock which has led, first, to brutal spikes in the demand for products needed to limit the expansion of the pandemic with the simultaneous collapse of supply channels because of our overreliance for a number of the relevant products on the production facilities of China, the first country to be hit by the pandemic. The current crisis is

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Authors

  • ESSEC Business School (Cergy)
  • Linklaters (London)
  • University of Geneva
  • Linklaters (Düsseldorf)
  • Geneva Law School
  • University of Montreal
  • McDermott Will & Emery (Paris)
  • National Commission for Markets and Competition (CNMC)
  • Dentons (Milan) (Studio Legale Tributario)
  • University of Michigan
  • General Court of the European Union (Luxembourg)
  • University of Geneva
  • Sheppard, Mullin, Richter & Hampton (Brussels)
  • Linklaters (Düsseldorf)
  • Baker Botts (Brussels)
  • Norton Rose Fulbright (Johannesburg)
  • Baker Botts (Brussels)
  • McDermott Will & Emery (Brussels)
  • UNCTAD (Geneva)
  • Willkie Farr & Gallagher (Paris)
  • Netherlands Authority for Consumers & Markets (The Hague)
  • Hogan Lovells (Munich)
  • Cleary Gottlieb Steen & Hamilton (Rome)
  • Hogan Lovells (Munich)
  • Cleary Gottlieb Steen & Hamilton (Brussels)
  • Redcliffe Partners (Kyiv)
  • Willkie Farr & Gallagher (Paris)
  • Kyoto University

Quotation

Frédéric Jenny, Christian Ahlborn, Jeremy Bacharach, Christoph Barth, Christian Bovet, Marcel Boyer, Jacques Buhart, Maria Pilar Canedo Arrillaga, Michèle Carpagnano, Daniel Crane, Aymeric de Moncuit, Valentine Delaloye, Jacques Derenne, David-Julien dos Santos Goncalves, David Gabathuler, Mark Griffiths, Leigh Hancher, David Henry, Pierre Horna, David Kupka, Siún O'Keeffe, Christian Ritz, Giulio Cesare Rizza, Matthias Schlau, Mario Siragusa, Anastasia Usova, Faustine Viala, Masako Wakui, Competition law and health crisis, May 2020, Concurrences N° 2-2020, Art. N° 94262, www.concurrences.com

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