BIBLIOGRAPHIE : LEWIS David (ed.), Edward Elgar, 2013, 224 p.

Building New Competition Law Regimes : Selected Essays, David LEWIS (ed.)

Mexico, Hungary, South Africa, Thailand and Zambia are featured in this collection. Although this is a limited sample, each country has a story to tell that is partly unique but also partly similar to those of other countries that have undergone the difficult task of introducing a competition law ethos and competition law institutions where there were essentially none before. Perhaps a conscious decision was made to exclude most of the BRICS, save one. I can start with a small criticism, which is that a horizontal chapter of lessons, for both new and old jurisdictions, might have served to unify the chapters. However, the reader can always write his own imaginary chapter for this purpose. And, as compensation for this apparent omission, the book does contain two bonus chapters, one on international antitrust problems and institutional responses, and one on regional (customs union or common market) agreements with competition provisions.

A particularly thoughtful (52-page) chapter on the evolution of competition law and enforcement in Hungary is provided by Csaba Kovács and Andreas Reindl. They fully explore the international influences (with interesting perspectives on Hungary’s accession process and the mixture of “reception” and selective adaptation of EU norms), the domestic political economy and the inter-institutional struggles that have shaped the GVH in its two-decade history. Although one of the authors is a GVH fellow, the chapter does not fail to acknowledge the authority’s own shortcomings and miscues. Competition authority officials should take note of the usefulness of this constructively candid approach, as opposed to the familiar refrain of—here is where we’ve made tremendous strides, and we’re at the top of our game. No deficiencies and we can only get better. The chapter seems to have been written before Hungary’s “watermelon” saga began, but the ploys by the Government to throw its weight around, favoring collusion in agriculture and seeking to weaken the GVH, are consistent with the unsettling trends highlighted by the authors. As they conclude, the GVH’s hard-earned effectiveness and accomplishments are fragile, and the increasingly inhospitable political environment in Hungary, coupled with the incompleteness of cultural change in surrounding institutions, has generated conditions of “systemic risk” (pp. 73-74).

The chapter on Mexico, by Eduardo Pérez Motta and Heidi Claudia Sada Correa, will appeal to anyone interested in “triage” regulatory reform in countries that start from a gloomy state-controlled economy, rife with industry-wide alliances and bloated public enterprises. The authors describe the undoubtedly difficult shift from the basket-case model to a market-based economy with a horizontal rather than vertical industrial policy ; and they describe the very active and necessary advocacy efforts of the Federal Competition Commission (now replaced by the Federal Economic Competition Commission), as well as important amendments made to Mexico’s competition law in 2006 and 2011. Further significant institutional reforms in Mexico, including the establishment in 2013 of specialized courts to review infringement decisions, were adopted following the completion of the chapter. And indeed, the process of reform has not settled down yet ; new proposals were tabled in February 2104 (see A. Perrot and A. Komninos, http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2404022).

The next chapter, by Janice Bleazard, discusses South Africa. Understanding competition policy in South Africa means, first of all, reading the speeches and essays, and most recently the monograph, of David Lewis. But the present chapter differs in that it is an entirely legal analysis. With reference to the case-law of the Competition Appeals Court and South Africa’s Supreme Court of Appeal, Bleazard recounts how, time after time, the courts have clipped the wings of the Competition Commission and the Tribunal. In some cases this was a matter of substantive interpretation, but above all it has resulted from the way the courts have interpreted procedural requirements. The net effect of the jurisprudence is to substantially limit the authorities’ ability to investigate and adjudicate cases in a flexible manner. As Bleazard points out, the formalistic and conservative rulings of the appellate courts (in vivid contrast to the Tribunal’s purposive interpretation) have played into the hands of vested corporate interests, as it has become increasingly difficult to ensure that cases are considered on the merits. Bleazard thus concludes that the courts have frustrated the will of the South African legislator, which had conceived the Competition Act not just as a piece of economic legislation but as a transformative tool of democratization and economic-social inclusion. She adds, however, that the landmark judgment of the Constitutional Court in the Senwes margin squeeze case (generally supporting the Competition Commission’s inquisitorial powers and overruling the SCA’s scrupulous adherence to a technicality) may point the way toward more supple judicial interpretations.

As if to eclipse the sad story from South Africa, Deunden Nikomborirak recounts the dismal failure of the competition law enterprise in Thailand. This country, like others, illustrates the need for stable political and social institutions as a pre-condition for the serious pursuit of competition policy. For Thailand, we must recognize that such stability is simply out of the question for the foreseeable future (in May of 2014, the situation is dire). Since there is little to say about Thai competition law, Nikomborirak turns to discuss the regime in South Korea, which might be used as a source of inspiration for countries which face enormous challenges, as Thailand does, in establishing a credible competition law regime. Nikomborirak recounts some of the South Korean “Cinderella” story and provides a helpful comparative discussion of the different economic environments that have characterized the two countries, the stark differences in their economic structures, political economies and (independence, relevance and capacities of) institutions, and the equally contrasting levels of public support for the competition law enterprise, a cause and effect of price regulation that has tended to keep necessities generally affordable, thereby sustaining the vicious circle.

Turning to Zambia, an overview of the relevant competition law regime and institutional context can be found in Alex Kububa’s 2012 Peer Review Report for UNCTAD (http://unctad.org/en/PublicationsLibrary/ ditcclp2012_Zambia_en.pdf). The chapter in the present collection, prepared by Thula Kaira, does not really set out to depict the competition policy framework in Zambia but it contains an in-depth discussion of the structure of Zambia’s economy, with a focus on the role of small, micro and medium-sized businesses (SMMEs). SMMEs operate in both the formal and informal sectors. The importance of the informal sector is understandable : Zambia’s economic fortunes turned south in the 1970s as world copper prices declined, and while the country has experienced relatively rapid growth since 2001, poverty and unemployment levels are still staggeringly high. In such conditions one suspects that there are limits to what competition policy can do unless it is accompanied by comprehensive efforts to build sound institutions, even if one can agree that competitive markets tend to encourage desirable wealth transfers and poverty alleviation effects. Be that as it may, Kaira reaches a number of policy conclusions based on Zambia’s economic make-up. For example, he suggests that a competition authority should be concerned with anticompetitive practices that harm informal business operators and formal-sector SMMEs, given their crucial contribution to employment and to some equivalent of social protection. Relying partly on the work of the 2008 OECD Global Forum, he also proposes that the proper way to manage the informal sector is to encourage its formalization through the reduction of regulatory barriers and of the cost of market entry. Kaira’s other recommendations include making refinements to the Competition and Consumer Act in order to secure more explicit recognition of the importance of SMMEs.

Part II of the book, entitled “Multinational issues and initiatives,” consists of two chapters. The first, written by Eleanor Fox, John Fingleton and Sophie Mitchell, looks at the gaps, overlaps and “institutional challenge” of international antitrust. The first 8 pages review the global competition issues and institutional responses and non-responses since the 1940s ; this historical summary is written with the astuteness one would expect from these authors. The remaining 10 pages are more forward-looking and concern the global competition issues that remain unresolved, and the ways in which international institutions, and above all the ICN, might contribute to their amelioration. One sympathizes with the authors’ plea for the governments of major jurisdictions to liberate themselves from their Palaeolithic nation-centric interests and to embrace a—non-mutually exclusive—vision of “world welfare,” in a manner roughly analogous to a vision of true global cooperation in environmental protection. Such a change of perspective and values would likely bring long-term benefits to all jurisdictions and immediate benefits to developing countries, which cannot act effectively by themselves to solve global competition problems. Although nation-states have a hardwired compulsion to privilege more narrow concepts of self-interest, the authors’ message is perhaps not hopeless : the evolution of international institutions suggests that unpredictable, post-Westphalian initiatives do occasionally gain momentum. In the meantime, productive cooperation can be achieved even without a cosmopolitan shift to concepts of world welfare. In this regard, the authors run through a variety of issues that require attention, such as, among others, deliberate or negligent state-imposed barriers to competition (sometimes even more pernicious than cynical price-fixing conspiracies) and the high cost of multiplicative merger review reviews (which could perhaps be addressed by a “common clearing-house” for first-stage merger filings : p. 180). Needless to say, the spectre of export cartels continues to haunt the international community. With regard to these and other issues, the authors consider that the flexible, low-stakes nature of the ICN’s work will furnish important means for the development of solutions that can later, if necessary, be upgraded to higher levels of commitment. The authors seem to recognize that different instruments, institutions and degrees of obligation will be more or less suited to a given problem. The challenge will be to reach consensus on the means to be used to address the issue at hand, which may involve several layers of controversy, and then implementing, evaluating and improving on those agreed means.

The final chapter is written by Alberto Heimler and Frédéric Jenny. The subject is regional competition law agreements, of which there are many. This chapter too begins with an authoritative summary of the reshaping of the international competition law landscape, especially since the 1990s and with particular attention given to developing countries. The authors recall the unsuccessful campaign to achieve a hard-law WTO agreement on competition law and further recall that “south-south” bilateral cooperation agreements are relatively few. The rest of the chapter is devoted to the main subject, regional agreements. The authors proceed along a simple line : the main regional agreements are summarized (Mercosur, Andean Community, COMESA, CARICOM, and the WAEMU), and in each case one or more fatal flaws are identified. The authors’ conclusion that the major regional agreements are in general deficient—due to, for example, design flaws (or in the case of the WAEMU, questionable judicial interpretation that amounts de facto to a design flaw), jurisdictional ambiguity, lack of political will, capacity or financial constraints, etc.—is consistent with the findings of the 2012 edited volume by J. Drexl, M. Bakhoum, E. Fox, M. Gal and D. Gerber, which I reviewed in this journal last year. In the final part of the chapter, Heimler and Jenny recall some of the building blocks of the “federal” antitrust enforcement structure in the European Union. The EU is, after all, the only clear success story among the existing regional schemes as far as competition law is concerned. The active contributions from the Commission and the Court of Justice, together with other essential elements, can be traced back to important decisions made at critical junctures (such as the negotiation of the Treaty of Rome, the adoption of Regulation 17/62, and, more recently, the design and implementation of Regulation No 1/2003), and the working methods of the European Competition Network certainly deserve to be studied by countries seeking to enhance the efficacy of their regional arrangements. Heimler and Jenny also suggest that regional groupings may wish to adapt and emulate the “twinning” projects that enabled experienced EU jurisdictions to train up officials in neighboring and accession countries, generally with positive results.

This collection is not to be used as a quick reference ; rather, it is a tool to facilitate a deeper understanding of certain foreign jurisdictions. This implies that its audience may be somewhat selective. But each of the chapters is readable, intelligent and rewarding. The chapter on Hungary alone is worth the price. However, readers with different needs—those seeking more straightforward presentations of rules, doctrine, practice pointers and so on—will want to look elsewhere.

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Auteur

  • Monash Law School (Melbourne)

Citation

Mel Marquis, Building New Competition Law Regimes : Selected Essays, David LEWIS (ed.), septembre 2014, Concurrences N° 3-2014, Art. N° 68001, pp. 243-249

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