LAW & ECONOMICS: ANTITRUST ENFORCEMENT - ECONOMIC ANALYSIS - COMPETITION AUTHORITIES - CARTELS - SANCTIONS

Guiding principles in setting cartel sanctions

We discuss various theoretical and empirical hurdles that antitrust authorities and courts must overcome to determine appropriate cartel sanctions, namely regarding the probability of detection, cartel dynamics, cartel duration, and cartel overcharge.

I. Introduction 1. Many antitrust authorities use fines and prison terms to prevent the formation of cartels or to destabilize operating ones. Sanctions against cartels are usually higher than those set for other infringements of competition laws, reflecting the consensus that price fixing, limitation of production, and market allocation cases (the so-called “naked cartels”) are particularly serious antitrust offenses that should be punished severely. Using relatively stiff sanctions, antitrust authorities pursue two objectives: restitution and deterrence. 2. The development of such antitrust public policy is grounded in economic theory from the pioneering contributions of economists in the 1960s to recent advances in assessment methods and econometrics. Gary S. Becker (1968) and

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Marcel Boyer, Anne Catherine Faye, Éric Gravel, Rachidi Kotchoni, Guiding principles in setting cartel sanctions, September 2019, Concurrences Review N° 3-2019, Art. N° 91218, www.concurrences.com

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