Elhauge Talk: Global Antitrust Courts


Last Thursday, Professor Einer Elhauge addressed an audience regarding his work on Global Antitrust Law as part of a year- long speaker series sponsored by the International Legal Studies department and the Graduate Program. The discussion was moderated by Professor William Alford, Vice Dean for the International Program and Graduate Studies. In this speaker series, members of the faculty speak informally about the international dimensions of their work. Professor Betsy Baker, Assistant Dean for the International Program and Graduate Studies, noted that “the speaker series is one of the initiatives under curricular reform,” the purpose of which is to provide a platform for students to gain knowledge on legal issues of global interest. Professor Elhauge predicted that the world twenty years from now might have Global Antitrust courts, and he believes that antitrust practice is the fastest growing practice area of law firms. He presented his work by introducing the antitrust law of both the United States and the European Commission (EC), comparing and contrasting laws of both jurisdictions, and concluding with his perspective on what the future holds. Professor Elhauge noted growing convergence between EC and US antitrust laws, such as the similarities in restrictions on both horizontal and vertical agreements. Moreover, the policy considerations underpinning enforcement by the relevant regulatory authorities were also quite similar. However, some important differences do remain: EC and US law differ in defining monopolization and its remedies, the former defining monopoly in harsher terms, considering a firm that has market share of less than 50% as a potential monopolist. The EU has also formally recognized the concept of “collective dominance,” which prohibits the leading firms in an industry from coordinating their activities so as to behave in a monopolistic fashion by raising prices and lowering output.The US, in contrast, has old legal dictum to the effect that only firms that have in excess of a 66% market share will be considered as monopolists and is more skeptical of the idea of “collective dominance.” Excessive pricing concerns also raise an interesting difference. Although rarely enforced, there is precedent within the EU to the effect that excessive pricing above cost provides a prima facie ground for antitrust action. In the US, on the other hand, monopoly profits are often celebrated as the reward for having provided a superior product or service capable of capturing a sizable share of the market. The EU also tends to “bundle” its antitrust and trade regulations by requiring countries with which it trades to adopt its antitrust laws; the US attaches no such conditions to its trade agreements. Presently, the US and EC do not have any reciprocal agreement governing antitrust laws and the US is not keen on working towards having similar laws. By exporting its antitrust laws to other countries, the EC is gaining a foothold in the development of international antitrust law, which may later compel the United States to arrive at an agreement if it wishes to maintain the overall efficacy of its antitrust law. A gradual approach towards adoption of similar laws by the US and EU is the most likely scenario and would likely entail a minimal number of compromises by US. Professor Elhauge, in response to a question, also suggested that it would be interesting to watch developments surrounding antitrust laws in developing countries. A developing country specializing in a certain industry or service might prefer to protect its national champions from the antitrust laws. Such a protection by these countries due to reasons of national economy and pride may change the whole dynamic of antitrust laws in developing countries and its consequent impact on global antitrust laws. Professor Elhauge was pleased at the participation of students and commended the initiative of International Legal Studies and the Graduate Program. However, the series has not been attracting enough desired participation, especially from 1Ls. The events are primarily attended by students with a prior knowledge on the subject. Professor Betsy Baker said that the International Legal Studies and the Graduate Program are brainstorming alternative ways to highlight the utility of the speaker series to students. During the spring term, five more such speaker events are scheduled. Professor Martha Minow is the next scheduled speaker on February 22 and will be addressing the following interesting topic: “Living up to Rules: When should soldiers (and others) disobey orders.”