International Competition Enforcement Law Between Cooperation and Convergence
Jörg Philipp Terhechte International Competition Enforcement Law Between Cooperation and Convergence
Dr. Jörg Philipp Terhechte University of Hamburg School of Law Rothenbaumchaussee 33 20148 Hamburg Germany joerg.terhechte@jura.uni-hamburg.de ISBN 978-3-642-17166-6 e-isbn 978-3-642-17167-3 DOI 10.1007/978-3-642-17167-3 Springer Heidelberg Dordrecht London New York Library of Congress Control Number: 2011921704 # Springer-Verlag Berlin Heidelberg 2011 A first English version of this book was published as Working Paper CCLP (L) 26 of the Centre for Competition Law and Policy at the University of Oxford available under http://denning.law.ox.ac.uk/ lawvle/users/ezrachia/cclp%20l.%2026.pdf A German version of this book was published in 68 Zeitschrift für ausländisches öffentliches Recht und Völkerrecht (ZaöRV)/Heidelberg Journal of International Law (HJIL) (2008), 689-762 Parts of the books were published in Jörg Philipp Terhechte (ed.), Internationales Kartell- und Fusionskontrollverfahrensrecht, Gieseking Publisher (Bielefeld) 2008 ( 1, 2 and 90) A Mongolian version of this book was published as GTZ Working Paper in 2008 (translation by Professor Temuulen Baata, Ph.D.) available under http://www.red-mongolia.mn/pdf/handbook/k3/ kartellrecht-mgl.pdf This work is subject to copyright. All rights are reserved, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilm or in any other way, and storage in data banks. Duplication of this publication or parts thereof is permitted only under the provisions of the German Copyright Law of September 9, 1965, in its current version, and permission for use must always be obtained from Springer. Violations are liable to prosecution under the German Copyright Law. The use of general descriptive names, registered names, trademarks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. Cover design: WMX Design GmbH, Heidelberg, Germany Printed on acid-free paper Springer is part of Springer Science+Business Media (www.springer.com)
To Nicole and Jakob
Preface International Competition Enforcement Law is a new field of research in jurisprudence which, until now, has attracted little attention. Academic debate has, in recent years, concentrated almost entirely on substantive law. Such an imbalanced focus, however, risks losing sight of the fact that the differing procedures, complex networks of co-operation between authorities and courts and the diverse organizational structures of the authorities all have an influence on the decision-making process in a manner which ought not to be underestimated. Whereas an increasing convergence of national, international and supranational law may be observed in the field of substantive law, enforcement law is characterized by a wide range of different approaches, and the complexity which necessarily accompanies such diversity in approach. A closer look at International Competition Enforcement Law quickly reveals a multitude of national cartel and competition laws (approximately 100 at the moment), all of which feature different procedural quirks. In addition, there is supranational and, in particular, with respect to procedure, complicated EU law, as well as a variety of regional regimes (for example, MER- COSUR or NAFTA), all of which are based on completely different procedural traditions. Lastly, there are several international administrative bodies (for example, the WTO or OECD) which aim at harmonizing and/or shaping procedural rules. These differences in regulation pose the question whether it is indeed possible to create a set of common procedural principles for competition and merger control law. This is the premise of this book, which discusses the most important national procedural rules, while also exploring links to supranational and international law and analyzing the comprehensive co-operative networks. With this approach, it is possible to delineate the general structures and basic principles of International Competition Enforcement Law and piece them together. The book has resulted from a German research project funded by the Fritz ThyssenStiftungfür Wissenschaftsförderung, Cologne, which has been conducted at the Universities of Hamburg and Bielefeld as well as at the George Washington University Law School and the U.S. Federal Trade Commission, Washington D.C. This project also resulted in the handbook Internationales vii
viii Preface Kartell- und Fusionskontrollverfahrensrecht (Jörg Philipp Terhechte, Ed.), Gieseking Publisher, Bielefeld 2008. Special thanks to Dr. Ariel Ezrachi, University of Oxford, Prof. Dr. Armin Hatje, University of Hamburg, Hon. Commissioner William E. Kovacic, Commissioner U.S. Federal Trade Commission, Washington, D.C. and John J. Parisi, Counsel for European Affairs, U.S. Federal Trade Commission, Washington, D.C., for their invaluable advice. Hamburg/Lüneburg January 2011 Jörg Philipp Terhechte
Contents 1 Introduction... 1 1.1 Overview... 1 1.1.1 Cooperation and Convergence... 1 1.1.2 International Competition Enforcement Law and Global Administrative Law... 3 1.2 The Term International Competition Enforcement Law... 4 1.2.1 General Remarks on the Term Enforcement... 4 1.2.2 International Competition Enforcement Law: A Definition... 5 2 Cooperation as Guiding Principle of International Competition Enforcement Law... 9 2.1 Fundamentals of Cooperation... 10 2.1.1 Globalization of Competition Restraints... 11 2.1.2 Globalization of Competition Policy?... 13 2.2 Forms of Cooperation... 14 2.2.1 Networks... 14 2.2.2 Classical Administrative Cooperation... 17 2.2.3 Cooperation Beyond the Limits of Authority... 17 2.2.4 Cooperation with Private Entities... 18 2.3 The Limits of Cooperation... 18 2.3.1 Differences in Procedures... 19 2.3.2 Fundamental and Human Rights... 19 2.3.3 Transparency Requirements... 20 2.3.4 Legal Protection... 21 2.3.5 Lack of Binding Nature... 21 3 Convergence of International Competition Enforcement Law... 23 3.1 Convergence of Substantive Standards... 23 3.2 Convergence on the Level of Enforcement?..... 23 3.2.1 Criminal Enforcement... 24 ix
x Contents 3.2.2 Effective Enforcement by Use of Leniency Programmes... 24 3.2.3 Private Enforcement... 25 3.2.4 Expansion of Governmental Cooperation... 26 3.2.5 Convergence and Divergence of Norms Securing Fundamental Rights... 26 3.2.6 The Effects Doctrine as a Global Criterion for Jurisdiction... 26 3.2.7 Reduction of Areas of Exception... 27 3.2.8 The Role of State-Owned Companies.... 27 3.2.9 International Free Trade Agreements and Regional Economic Integration... 27 3.3 Sources of Law of Converging Procedural Law... 30 3.3.1 The Level of Public International Law... 30 3.3.2 The Level of Regional Economic Integration Treaties... 32 3.3.3 The Level of European Law... 32 3.3.4 The Role of the ECHR... 35 3.3.5 The Level of National Law... 35 3.4 Scope of Application of National Rules... 39 3.4.1 Possible Links for the Scope of Application... 40 3.4.2 Current Dominance of the Effects Doctrine... 42 3.4.3 Personal Scope of the Application of National Laws... 43 3.4.4 Exemptions... 44 3.5 Actors..... 47 3.5.1 Variety of Authorities as Initial Perspective... 48 3.5.2 Differences Between Authorities... 50 3.5.3 A World Antitrust Authority as Platform of Coordination?... 57 3.5.4 Role of the Courts... 58 3.5.5 Privates... 58 3.6 Variety and Uniformity of Proceedings... 59 3.6.1 Administrative Proceeding... 59 3.6.2 Court Proceedings... 63 4 Procedural Convergence Through Cooperation?... 67 4.1 Contents of Cooperation... 67 4.2 Emerging Global Enforcement Standards?... 68 4.2.1 Role of the International Competition Network... 69 4.2.2 Role of the OECD... 69 4.2.3 Role of UNCTAD... 69 4.2.4 Claim to Self-Determination by National Law as an Obstacle... 70 4.3 World Competition Enforcement Law in the Making?... 70 4.3.1 DIAC as a Paragon?... 70 4.3.2 The Role of Politics... 72 5 Summary... 75 References... 79
List of Abbreviations AECLJ Association of European Competition Law Judges AEI American Enterprise Institute AJIL American Journal of International Law ANCERTA Australia-New Zealand Closer Economic Relations Trade Agreement APEC Asia-Pacific Economic Cooperation ARC (German) Act against Restraints of Competition ASEAN Association of Southeast Asian Nations BGB Bürgerliches Gesetzbuch/(German) Civil Code CAN Comunidad Andina/Andean Community CAT Competition Appeal Tribunal CFI Court of First Instance (! GC) CMLRev. Common Market Law Review CNDC Comisión Nacional de Defensa de la Competencia/(Argentinian) National Commission for Competition Defense COMESA Common Market for Eastern and Southern Africa DG Directorate-General DIAC Draft International Antitrust Code DOJ (United States) Department of Justice EC European Community ECHR European Convention on Human Rights ECJ European Court of Justice ECLR European Competition Law Review ECN European Competition Network ECOWAS Economic Community of West African States ECR European Court Reports ed./ed. Edition/Editor EEA European Economic Area EJIL European Journal of International Law EnWG Energiewirtschaftsgesetz/(German) Law Concerning the Energy Economy xi
xii List of Abbreviations et seq Et sequens/sequentes (and following page/pages) EU European Union FCO (German) Federal Cartel Office FTAA Free Trade Area of the Americas FTC Federal Trade Commission GAL Global Administrative Law GATS General Agreement on Trade in Services GATT General Agreement on Tariffs and Trade GC General Court GE General Electric Company GWB Gesetz gegen Wettbewerbsbeschränkungen (! ARC) i.e. Id est (that is/for example) IAJ International Association of Judges ibid. Ibidem (in the same location) ICJ International Court of Justice ICN International Competition Network id. Idem (same author) IMPEL European Union Network for the Implementation and Enforcement of Environmental Law Int. J. Indust. Org. International Journal of Industrial Organization Int l Law. International Lawyer (Journal) JCMS Journal of Common Market Studies JFTC Japan Fair Trade Commission KPPU Komisi Pengawas Persaingan Usaha/(Indonesian) Commission for the Supervision of Business Competition L. J. Law Journal MERCOSUR Mercado Común del Sur NAFTA North American Free Trade Agreement NCA National Competition Authority O.J. Official Journal of the European Union OECD Organization for Economic Co-operation and Development OPEC Organization of Petroleum Exporting Countries p. Page para/paras Paragraph/Paragraphs SADC Southern African Development Community TEC Treaty establishing the European Community TEU Treaty on European Union TFEU Treaty on the Functioning of the European Union TPA Trade Practices Act TRIPS Agreement on Trade-Related Aspects of Intellectual Property Rights U.S. United States U.S.C. United States Code UN United Nations UNCTAD United Nations Conference on Trade and Development
List of Abbreviations Va. J. Int. L. VwVfG WTO WTOA ZCC ZPO xiii Virginia Journal of International Law Verwaltungsverfahrensgesetz/(German) General Administrative Code World Trade Organization Agreement Establishing the World Trade Organization Zambian Competition Commission Zivilprozessordnung/(German) Civil Procedure Code