Resale Price Maintenance: Economic Theories and Empirical Evidence
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Competition Law
COMPETITION LAW SIBERGRAMME 2/2012 ISSN 1606-9986 21 August 2012 Senior Editor ROBERT LEGH Head of the Competition Law Unit of Bowman Gilfillan Inc, Johannesburg This issue by LAUREN RICHARDS and KHOFOLO KRUGER Candidate Attorneys: Bowman Gilfillan Inc Siber Ink Published by Siber Ink CC, B2A Westlake Square, Westlake Drive, Westlake 7945. © Siber Ink CC, Bowman Gilfillan Inc This Sibergramme may not be copied or forwarded without permission from Siber Ink CC Subscriptions: [email protected] or fax (+27) 086-242-3206 To view Competition Tribunal judgments, see: http://www.comptrib.co.za/ Page 2 ISSN 1606-9986 COMPETITION LAW SG 2/2012 IN THIS ISSUE: ESSENTIAL MATTERS: A COMPARATIVE ASSESSMENT OF DIFFERENT APPROACHES TO THE ESSENTIAL FACILITIES DOCTRINE............................. 2 Introduction..............................................................................................................................2 South Africa .............................................................................................................................3 The United States (US).............................................................................................................10 The European Union (EU).......................................................................................................13 Comparison of the US and EU positions .................................................................................15 Conclusion ...............................................................................................................................17 -
Ruling Within Reason: a Reprieve for Resale Price Maintenance
Agenda Advancing economics in business Ruling within reason: a reprieve for resale price maintenance As a result of the US Supreme Court’s recent overturning of the long-standing 1911 Dr Miles decision, which deemed minimum resale price maintenance unlawful per se, this practice is to be judged under the ‘rule of reason’ in the USA, as has been the case with other vertical restraints. Is it therefore time to change the European approach to vertical price fixing? In its June 2007 judgement in Leegin Creative Leather purposes of applying Article 81(1) to demonstrate Products, Inc. v. PSKS, Inc, the US Supreme Court ruled any actual effects on the market.5 that resale price maintenance (RPM) should be judged under the ‘rule of reason’.1 The Leegin ruling overturned In line with the Commission’s approach, in the UK the long-standing 1911 Dr Miles precedent, which held minimum RPM is considered a hard-core practice that that it is per se unlawful under Section 1 of the Sherman ‘almost inevitably’ infringes Article 81 or the Chapter I Act for firms to fix the minimum retail price at which prohibition under the Competition Act 1998.6 Indeed, the retailers may sell goods or services on.2 Office of Fair Trading (OFT) has brought a number of high-profile vertical price fixing cases in recent years, as The outcome of the Leegin case has relieved those who discussed below. support the view that, although under certain circumstances minimum RPM may result in sub-optimal In light of the Leegin judgement, is this the time for market outcomes, this risk is not sufficient to make the European competition policy to move towards an effects- practice illegal per se. -
Hearing on Oligopoly Markets, Note by the United States Submitted To
Unclassified DAF/COMP/WD(2015)45 Organisation de Coopération et de Développement Économiques Organisation for Economic Co-operation and Development 12-Jun-2015 ___________________________________________________________________________________________ _____________ English - Or. English DIRECTORATE FOR FINANCIAL AND ENTERPRISE AFFAIRS COMPETITION COMMITTEE Unclassified DAF/COMP/WD(2015)45 HEARING ON OLIGOPOLY MARKETS -- Note by the United States -- 16-18 June 2015 This document reproduces a written contribution from the United States submitted for Item 5 of the 123rd meeting of the OECD Competition Committee on 16-18 June 2015. More documents related to this discussion can be found at www.oecd.org/daf/competition/oligopoly-markets.htm. English English JT03378438 Complete document available on OLIS in its original format - This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of English Or. international frontiers and boundaries and to the name of any territory, city or area. DAF/COMP/WD(2015)45 UNITED STATES 1. Following on our submissions to previous OECD roundtables on oligopolies, notably the 1999 submission of the U.S. Department of Justice and the U.S. Federal Trade Commission on Oligopoly (describing the theoretical and economic underpinnings of U.S. enforcement policy with regard to oligopolistic behavior),1 and the 2007 U.S. submission on facilitating practices in oligopolies,2 this submission focuses on certain approaches taken by the Federal Trade Commission (“FTC”) and the U.S. Department of Justice Antitrust Division (“DOJ”) (together, “the Agencies”) to prevent the accumulation of unwarranted market power and address oligopoly issues. 2. Pursuant to U.S. -
BIOGRAPHICAL DATA on SUSAN E. ARNOLD Vice Chair
(Photo by Ken Shung 2006) BIOGRAPHICAL DATA ON SUSAN E. ARNOLD Vice Chair – P&G Beauty & Health RESIDENCE: Cincinnati, Ohio, USA DATE OF BIRTH: March 8, 1954 PLACE: Pittsburgh, Pennsylvania EDUCATION: University of Pennsylvania, B.A., 1976 University of Pittsburgh, M.B.A., 1980 BUSINESS AFFILIATIONS PRIOR TO JOINING PROCTER & GAMBLE: None DATE JOINED PROCTER & GAMBLE: September 1980 POSITIONS HELD AND DATES: 1980 - Brand Assistant, Dawn/Ivory Snow 1981 - Sales Training, Philadelphia 1981 - Assistant Brand Manager, Oxydol 1983 - Assistant Brand Manager, Cascade 1984 - Brand Manager, Gain/Special Assignment 1985 - Brand Manager, Tide Sheets 1986 - Brand Manager, Dawn 1987 - Associate Advertising Manager, PS&D Advertising 1987 - Associate Advertising Manager, Laundry Products, PS&D Division 1988 - Associate Advertising Manager, Laundry Specialty Products, PS&D Division 1989 - Advertising Manager, Fabric Softeners, BS&HCP Division 1990 - Manager, Noxell Products, International Division (Canada) 1992 - Special Assignment to R. T. Blanchard 1993 - General Manager, Deodorants/Old Spice, Procter & Gamble USA 1996 - Vice President and General Manager, Deodorants/Old Spice and Skin Care Products-U.S., Procter & Gamble North America 1997 - Vice President and General Manager, Laundry Products-U.S., Procter & Gamble North America 1999 - Vice President-North America Fabric Care 1999 - President-Global Skin Care 2000 - President-Global Cosmetics & Skin Care 2000 - President-Global Personal Beauty Care 2002 - President-Global Personal Beauty Care & Global Feminine Care 2004 - Vice Chair – P&G Beauty 2006 - Vice Chair – P&G Beauty & Health SUSAN E. ARNOLD Vice Chair – P&G Beauty & Health The Procter & Gamble Company In 2004, Susan Arnold was the first woman to be named to the Vice Chair position at P&G. -
Resale Price Maintenance in China – an Increasingly Economic Question
Resale Price Maintenance in China – an increasingly economic question Three recent decisions in China suggest that Resale Specifically, the Court was clear that since RPM was Price Maintenance cases will not be decided solely on a defined in the law as a “monopoly agreement”, it must be legal consideration but will also turn on the economic expected to have the impact of eliminating or restricting context of the agreements in question. competition in order to be found illegal. To determine whether the agreement had the impact of eliminating or Resale Price Maintenance (RPM) is a contractual restricting competition, the Court proposed four constituent commitment imposed by a supplier on its distributors not to economic questions: sell its product for less (or more) than a given price. It is very 1. Is competition in the relevant market “sufficient”? common in distribution contracts throughout the world, 2. Does the defendant have a “very strong” market especially in China because of the control that RPM position? provides over resale quality and the distribution chain. 3. What was the motive behind the RPM agreements? RPM is a particularly contentious area of competition law 4. What was the competitive effect of the RPM? since RPM clauses can be both beneficial and harmful to competition depending on the context in which they are implemented. For example, RPM may facilitate unlawful Specifically, the Court suggested that if competition in the collusion between suppliers by allowing them to control and market was sufficient then it would not have found the RPM monitor the final retail price. RPM may also be forced on agreement illegal. -
Amazon's Antitrust Paradox
LINA M. KHAN Amazon’s Antitrust Paradox abstract. Amazon is the titan of twenty-first century commerce. In addition to being a re- tailer, it is now a marketing platform, a delivery and logistics network, a payment service, a credit lender, an auction house, a major book publisher, a producer of television and films, a fashion designer, a hardware manufacturer, and a leading host of cloud server space. Although Amazon has clocked staggering growth, it generates meager profits, choosing to price below-cost and ex- pand widely instead. Through this strategy, the company has positioned itself at the center of e- commerce and now serves as essential infrastructure for a host of other businesses that depend upon it. Elements of the firm’s structure and conduct pose anticompetitive concerns—yet it has escaped antitrust scrutiny. This Note argues that the current framework in antitrust—specifically its pegging competi- tion to “consumer welfare,” defined as short-term price effects—is unequipped to capture the ar- chitecture of market power in the modern economy. We cannot cognize the potential harms to competition posed by Amazon’s dominance if we measure competition primarily through price and output. Specifically, current doctrine underappreciates the risk of predatory pricing and how integration across distinct business lines may prove anticompetitive. These concerns are height- ened in the context of online platforms for two reasons. First, the economics of platform markets create incentives for a company to pursue growth over profits, a strategy that investors have re- warded. Under these conditions, predatory pricing becomes highly rational—even as existing doctrine treats it as irrational and therefore implausible. -
The Three Types of Collusion: Fixing Prices, Rivals, and Rules Robert H
University of Baltimore Law ScholarWorks@University of Baltimore School of Law All Faculty Scholarship Faculty Scholarship 2000 The Three Types of Collusion: Fixing Prices, Rivals, and Rules Robert H. Lande University of Baltimore School of Law, [email protected] Howard P. Marvel Ohio State University, [email protected] Follow this and additional works at: http://scholarworks.law.ubalt.edu/all_fac Part of the Antitrust and Trade Regulation Commons, and the Law and Economics Commons Recommended Citation The Three Types of Collusion: Fixing Prices, Rivals, and Rules, 2000 Wis. L. Rev. 941 (2000) This Article is brought to you for free and open access by the Faculty Scholarship at ScholarWorks@University of Baltimore School of Law. It has been accepted for inclusion in All Faculty Scholarship by an authorized administrator of ScholarWorks@University of Baltimore School of Law. For more information, please contact [email protected]. ARTICLES THE THREE TYPES OF COLLUSION: FIXING PRICES, RIVALS, AND RULES ROBERTH. LANDE * & HOWARDP. MARVEL** Antitrust law has long held collusion to be paramount among the offenses that it is charged with prohibiting. The reason for this prohibition is simple----collusion typically leads to monopoly-like outcomes, including monopoly profits that are shared by the colluding parties. Most collusion cases can be classified into two established general categories.) Classic, or "Type I" collusion involves collective action to raise price directly? Firms can also collude to disadvantage rivals in a manner that causes the rivals' output to diminish or causes their behavior to become chastened. This "Type 11" collusion in turn allows the colluding firms to raise prices.3 Many important collusion cases, however, do not fit into either of these categories. -
Experimental Evidence on Predatory Pricing Policies
A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Edlin, Aaron S.; Roux, Catherine; Schmutzler, Armin; Thöni, Christian Working Paper Hunting unicorns? Experimental evidence on predatory pricing policies Working Paper, No. 258 Provided in Cooperation with: Department of Economics, University of Zurich Suggested Citation: Edlin, Aaron S.; Roux, Catherine; Schmutzler, Armin; Thöni, Christian (2017) : Hunting unicorns? Experimental evidence on predatory pricing policies, Working Paper, No. 258, University of Zurich, Department of Economics, Zurich, http://dx.doi.org/10.5167/uzh-138188 This Version is available at: http://hdl.handle.net/10419/173418 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle You are not to copy documents for public or commercial Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich purposes, to exhibit the documents publicly, to make them machen, vertreiben oder anderweitig nutzen. publicly available on the internet, or to distribute or otherwise use the documents in public. Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, If the documents have been made available under an Open gelten abweichend von diesen Nutzungsbedingungen die in der dort Content Licence (especially Creative Commons Licences), you genannten Lizenz gewährten Nutzungsrechte. may exercise further usage rights as specified in the indicated licence. www.econstor.eu University of Zurich Department of Economics Working Paper Series ISSN 1664-7041 (print) ISSN 1664-705X (online) Working Paper No. -
Catalog Holding List A-E in PDF Form
Company Name Location Date Original? Pages Color-B/W? Product Comments See U.S. Glass Circa Adams & Co. Copy 1890-1900 Akro Agate Glass Co. Clarksburg, WV 1940’s Original 4 Color Akroite floral containers Decorated beverage ware, Anchor Hocking Lancaster, OH 1942 Original 11 Color Fire-King oven ware & jade- ite Anchor Hocking Lancaster, OH 1953 Original 4 B/W Cape Cod or Sandwich pattern Loose sheets Decorated glass, Sandwich Some pages have Anchor Hocking Lancaster, OH 1954 Original 44 Color, B/W pattern, Fire-King, etc. pictures cut out Turquoise Blue & Copper Tint Anchor Hocking Lancaster, OH 1956 Original 5 Color Loose sheets Fire-King Plus 4 page B/W price Anchor Hocking Lancaster, OH 1957-1958 Original 47 Color, B/W Fire-King, Forest Green, etc. list Fire-King, beverage items, Anchor Hocking Lancaster, OH 1959-1960 Original 56 Color, B/W kitchenware Fire-King, kitchenware, some Anchor Hocking Lancaster, OH 1960-1961 Original 59 Color, B/W Early American Pres-cut, etc. Anchor Hocking Lancaster, OH 1961 Original 1 Color Desert gold stemware Fire-King, Sandwich, Several pages with cut Anchor Hocking Lancaster, OH 1961-1962 Original 67 Color, B/W beverage items, etc. outs “Institutional Glassware”, Anchor Hocking Lancaster, OH 1963 Original 12 B/W Stems, tumblers, Ashtrays, Catalog HR 63 etc. Mostly beverage ware, some Plus 8 page B/W price Anchor Hocking Lancaster, OH 1964 Original 78 Color, B/W Fire-King list Tumblers, Prescut, Ovenware, Plus 2 page B/W price Anchor Hocking Lancaster, OH 1965 Original 78 Color etc. revision sheet Loose sheet, includes Anchor Hocking Lancaster, OH 1965 Original 2 B/W “Bravo” Cut Tumblers prices Beverage Ware, Prescut, , Plus 1 page B/W price Anchor Hocking Lancaster, OH 1966 Original 80 Color Jade-ite, etc. -
Predatory Pricing, a Case Study: Matsushita Electric Industries Co. V. Zenith Radio Corporation
PREDATORY PRICING, A CASE STUDY: MATSUSHITA ELECTRIC INDUSTRIES CO. V. ZENITH RADIO CORPORATION M. STEVEN WAGLE INTRODUCTION There is an abundance of predatory pricing theories. Scholars have created a barrage of rules and thresholds designed to detect un- lawful predatory practices. The most influential work on predatory practice was written almost thirty years ago by John S. McGee.1 Mc- Gee showed that although it was widely believed that the Standard Oil Company used predatory pricing in its virtual monopolization of the oil refining market, there was no hard evidence to show that Standard Oil in fact employed such pricing. Since McGee, many scholars have reviewed the theories of pric- ing, and recent literature on the law and economics of antitrust has devoted increasing attention to this issue.2 There has also been an outpouring of cost-based rules appearing in court opinions dealing with predatory pricing.3 These rules can essentially be attributed to t J.D., Washburn University, 1986; M.A., Wichita State University, 1986; B.A., Unmversity of Kansas, 1980. Law clerk to the Hon. John K. Pearson, Wichita, Kansas. I would like to thank Dr. Philip Hersch, Professor of Economics, Wichita State Umver- sity, for patiently reviewing this article and offering invaluable criticism of it. 1. McGee, Predatory Price Cutting: The Standard Oil (NJ.) Case, 1 J.L. & EcON. 137 (1958). 2. For additional perspectives, see Areeda & Turner, PredatoryPring and Re- lated Practices Under Section 2 of the Sherman Act, 88 HARV. L. REV. 697 (1975); Jos- kow & Klevorick, A Frameworkfor Analyzing PredatoryPrmcng Policy, 89 YALE L.J. -
Resale Price Maintenance and Minimum
Presenting a live 90-minute webinar with interactive Q&A Resale Price Maintenance and Minimum Advertised Pricing: Structuring to Minimize Antitrust Scrutiny State, Federal, and International Treatment of RPM Agreements and MAP Policies THURSDAY, FEBRUARY 28, 2019 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific Today’s faculty features: Michael A. Lindsay, Partner, Dorsey & Whitney LLP, Minneapolis William L. Monts, III, Partner, Hogan Lovells US, Washington, D.C. The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 1. Tips for Optimal Quality FOR LIVE EVENT ONLY Sound Quality If you are listening via your computer speakers, please note that the quality of your sound will vary depending on the speed and quality of your internet connection. If the sound quality is not satisfactory, you may listen via the phone: dial 1-866-961-8499 and enter your PIN when prompted. Otherwise, please send us a chat or e-mail [email protected] immediately so we can address the problem. If you dialed in and have any difficulties during the call, press *0 for assistance. Viewing Quality To maximize your screen, press the F11 key on your keyboard. To exit full screen, press the F11 key again. Continuing Education Credits FOR LIVE EVENT ONLY In order for us to process your continuing education credit, you must confirm your participation in this webinar by completing and submitting the Attendance Affirmation/Evaluation after the webinar. -
The United States Has a Market Concentration Problem Reviewing Concentration Estimates in Antitrust Markets, 2000-Present
THE UNITED STATES HAS A MARKET CONCENTRATION PROBLEM REVIEWING CONCENTRATION ESTIMATES IN ANTITRUST MARKETS, 2000-PRESENT ISSUE BRIEF BY ADIL ABDELA AND MARSHALL STEINBAUM1 | SEPTEMBER 2018 Since the 1970s, America’s antitrust policy regime has been weakening and market power has been on the rise. High market concentration—in which few firms compete in a given market—is one indicator of market power. From 1985 to 2017, the number of mergers completed annually rose from 2,308 to 15,361 (IMAA 2017). Recently, policymakers, academics, and journalists have questioned whether the ongoing merger wave, and lax antitrust enforcement more generally, is indeed contributing to rising concentration, and in turn, whether concentration really portends a market power crisis in the economy. In this issue brief, we review the estimates of market concentration that have been conducted in a number of industries since 2000 as part of merger retrospectives and other empirical investigations. The result of that survey is clear: market concentration in the U.S. economy is high, according to the thresholds adopted by the antitrust agencies themselves in the Horizontal Merger Guidelines. By way of background, recent studies of industry concentration conclude that it is both high and rising over time. For example, Grullon, Larkin, and Michaely conclude that concentration increased in 75% of industries from 1997 to 2012. In response to these and similar studies, the antitrust enforcement agencies recently declared that their findings are not relevant to the question of whether market concentration has increased because they study industrial sectors, not antitrust markets. Specifically, they wrote, “The U.S.