Effectiveness & Impediments for Bilateral Approaches to Antitrust Enforcement and Implications for Multilateral Cooperation Dr. James H. Mathis Department of International Law University of Amsterdam

2 UNCTAD Istanbul What are ‘ regional competition provisions’? An RTA can have ‘provisions’ without establishing any regional law. Requiring other country to have a law is harmonization but is not ‘regional competition law’ Regional law requires a separate / distinct regional jurisdiction … as affecting trade between members or affecting regional territory An RTA can establish regional law with or w/out creating authority

3 UNCTAD Istanbul Measuring Effectiveness What values for competition policy in RTAs Supporting domestic competition law capacity Addressing AC practices with international dimension Resolving international trade issues via competition Supporting regional integration (not only ´trade´) Complementing economic / sustainable development

4 UNCTAD Istanbul Raising regional integration as a value Do firms respond to free trade by private barriers ? Do they respond differently in preferential agreements? Are the opportunities greater for forming import – export barriers or cross-border collusion than multilateral ? If so, does ´integration´ require more than voluntary agency cooperation. Are demands different in an FTA as compared to a CU?

5 UNCTAD Istanbul RTAs & agency agmts – any differences? RTAs can be ´directive´ and create government treaty obligations beyond agency authority  Obligation to establish agency, for example  Political oversight and review is possible Trade is not overriding domestic competition law in the RTA´s No regional institutions or region-wide definitions – remain national territory based. No dispute settlement (specificially exempt)

6 UNCTAD Istanbul Cooperation instruments – OECD 95 / 98 Methodology: Compare OECD instruments (95 & 98) to RTA provisions in north-south RTAs - ´NOTIFICATION` when enforcement affects ´important interests´ of the other party ´COORDINATION´ cooperation on common facts ´INVESTIGATIVE ASSISTANCE´ receive information upon request ´POSITIVE COMITY´ request to apply requested party´s law- mainly treating exclusonary practices ´COMPULSORY ASSISTANCE´ contemplated for HCC – 98 instrument

7 UNCTAD Istanbul #1 Can ´notification´ be developed ? As a separate instrument of ´notification` - Not traditional comity but ´Assistive´ notification  No Request Necessary  No Notifying party enforcement proceeding necessary Traditional comity emphasis on notifying enforcement action, not the underlying practices. It is the action affecting other territory that invokes traditional comity

8 UNCTAD Istanbul Agreements that contemplate ´notification´ Canada – Chile: enforcement affecting other party´s interests ´in the application´of its competition law... Canada – Costa Rica: important interests defined as notifying AC in other territory that may be ´significant for that other party´ US – Brazil (agency agreement): notifying when activity is ´relevant to enforcement activities of the other party` (do other party´s activities have to be commenced..?)

9 UNCTAD Istanbul EU – Mexico ´notification´ `Coop & Coord´ includes notifying practice if ´relevant to enforcement activities of other party´ Notifies if restrictions affect other territory - jurisdictional BUT – cumulative list: AND includes orders prohibiting conduct or actors on other territory... Authorities to Xchange info on ´any known AC activities´ Priority practices stated for each party. implications ?

10 UNCTAD Istanbul Compare to other regulatory cooperation US – Australia consumer protection, agency agreement- ´Parties intend to assist one another in providing or obtaining evidence (determining) whether a person has violated or may violate their respective consumer laws` Parties shall use best efforts to inform ASAP about violations occurring in..other party OR that affect consumers or markets in the TERRITORY of the other PARTY

11 UNCTAD Istanbul #2 positive comity & recourse – EU - SA Practices Include vertical restraints (rule of reason) Obligation to have law in 3 years Art. 37 appropriate measures if no law or unable to implement – w/ injury to DOMESTIC INDUSTRY Notice to cooperation council then unilateral action This is a safeguard measure – Is it recourse for failure to respond to positive comity request ? IF so, what is the ´appropriate´measure to be taken ?? Trade measure ? If so, then only example of trade objectives requiring enforcement of competition law

12 UNCTAD Istanbul Development considerations – balancing notification and pos. comity If there is a stronger positive comity, then There should be proactive ´notification´ to balance. i.e., binding cooperation via not Short of dispute settlement, what oversight means  Regular political oversight – are agencies paying attention