Guide to use of economics in State aid cases
SSRN Electronics Journal, January 2020
Akos Reger and Cento Veljanovski have collaborated to show how economics is increasingly used to assess state aid measures. In light of the economic theory and the case law they outline the application of economics to the market economy investor principle (MEIP), and in the assessment of the ‘necessity’ and ‘proportionality’ of the aid given. They also discuss the economic interpretation of the concept of ‘well run’ undertaking under the 4th Altmark criterion.
European Cartel Fines in 2019
Case’s Annual Review, 7 January 2020
Case has published its Annual Review of fines imposed on cartels by the European Commission during 2019.
During 2019 the Commission imposed fines of €1,469 million on five cartels involving the supply of car parts, forex trading and canned vegetables. Remarkably these fines were less than the amount given to the cartelists in reductions for leniency and settlement, Had these not been given the fines paid by the cartelist would have been €3.4 billion or 130% larger.
All cartels were detected by whistelblowers and all were settled with the Commission. Other features of the five cartels are given in the Annual Review.
The Commission also undertook two ‘dawn raids, commenced one proceeding, issued one Statement of Objections, re-adopted one decision (Reinforced steel bars) following 12 years of legal wrangling in the courts, and published three full and summary decisions of cartels prosecuted in earlier years.
Cartels, Sustainability and the Public Interest Defence
Trust on the Market, 30 December 2019
Cento Veljanovski contributed a timely blog to the Truth on the Market website entitled Efficient Cartels and the Public Interest Defence – Do They Exist? This examines whether the consumer welfare and efficiency (or total welfare) standards conflict when considering cartels in industries with large fixed costs or those where there are environmental concerns.
The central issue is whether Article 101(3)TFEU of European antitrust should and can be expanded to take account of the wider social costs and benefits while preserving its integrity and coherence.
The blog is based on Cento’s talk to the Vinson Centre’s law and economics conference held at the University of Buckingham in early December 2019
Court of Appeal re-sets bar to UK Collective Certification
Competition Law Insights, June 2019
In a landmark judgment delivered on 16 April 2019 the English Court of Appeal set aside the Competition Appeal Tribunal’s (CAT) order refusing to certify Mr Merricks’ £14 billion damages claim against MasterCard for charging excessive interchange fees. The Court held that it was not appropriate for the CAT to conduct a ‘mini trial’ on the merits of the claim and to refuse certification because the proposed method of distributing the award of aggregate damages was not compensatory. The decision has been appealed to the Supreme Court to be heard in May 2020. In the meantime all class certification actions have been halted.
European Cartel Fines in 2018
Competition Law Insights, 2019
Case’s annual survey of European Commission cartel fines has been published. The European Commission completed four investigations in 2018 comprising five cartels/infringements. Aggregate fines of euro 800 million were imposed after leniency and settlement discounts. The Commission undertook two ‘dawn raids’, commenced one proceeding and issued one Statement of Objections. Fines were lower than in previous years. The Commission’s targeting of the automotive sector continued.
Article shortlisted for Antitrust Writing Award
Cento Veljanovski’s article Credit Cards, Counterfactuals and Antitrust Damages was shortlisted as one of the best article on antitrust in the 2019 Antitrust Writing Awards organised by Concurrences Review and the George Washington University Law School Competition Law Center. The article appeared in the Journal of European Competition Law & Practice.
Comments on EU Draft Pass-on Guidelines
Response to European Commission’s consultation
Cento Veljanovski’s submitted a response to the European Commission’s consultation on its draft Guidelines for national courts on how to estimate the share of overcharge which was passed on to indirect purchasers. In summarising his detailed assessment Cento concludes:
“In my view the draft Guidelines do not adequately achieve their stated purpose. They are strong on economic principles, theory and descriptions of some quantitative methods, cover data requirements and disclosure reasonably well, but do not offer real practical guidance that would enable a generalist judge to assess the proposed quantitative methods and conflicting expert opinions; nor do they guide the court in how in the absence of data and evidence and/or conflicting evidence to estimate pass-on.’