International Cooperation in Competition Policy: The US Experience

1
International Cooperation in Competition Policy
The US Experience

• William E. Kovacic
• U.S. Federal Trade Commission
• May 15, 2002
• wkovacic_at_ftc.gov

2
Presentation Theme

• US Participation in International Competition
  Policy Programs
• Focus Development of Institutions
• Disclaimer Personal Views.

3
Resources

• Institutional Foundations for Economic Law Reform
  in Transition Economies, 77 Chicago-Kent Law
  Review 265 (2001).
• Evaluating Antitrust Experiments, 9 George Mason
  Law Review 843 (2001).
• Boeing-McDonnell Douglas Merger, 68 Antitrust Law
  Journal 805 (2001).

4
Organization

• Development of Competition Laws Trends and
  Rationales
• Institutional Multiplicity
• Methods of Cooperation
• Some General Lessons

5
Trends in Development of Competition Laws

• Yesterday
• Status Quo in 1950 US
• Status Quo in 1975 US and EU
• Today Over 90 Laws Worldwide
• 50 new laws in emerging markets since 1975
• Major reforms in older systems
• Tomorrow Over 100 Laws by 2010
• Unique Opportunity for Comparative Study

6
Consequences of Multiplicity

• Divergence Concerning
• Substantive Standards e.g., GE/Honeywell
• Processes e.g., Role of Judiciary in Merger
  Review
• Institutional Capability Developed versus
  Developing Countries (cf. International Networks).

7
Convergence Models

• Top Down Imposition of Binding Norms
• Bottom Up Evolution of Norms
• Decentralized experimentation
• Identification of best practices
• Opting in or agreement on norms
• Example Merger Guidelines

8
Cooperation Means

• Bilateral Seven US Agreements
• IAEAA One Agreement
• Multilateral Global OECD, UNCTAD, WTO, ICN
• Multilateral Regional FTAA, Caricom, Comesa,
  APEC, ASEAN, Mercosur, Andean Pact, W. African
  Monetary Union
• Technical Assistance

9
Key Elements

• Build Personal Relationships
• Examine Specific Cases
• Working Groups
• Regular Coordination
• Progressive Elaboration
• Agreements in General
• Bilaterals

10
Cooperation and Convergence

• Building an Intellectual Consensus
• Devoting Resources to Institution Building
• Prediction A Gradual Progression

11
Benefits of Comparative Study

• Comparative Perspectives Can Help
• Teach concepts
• Transfer practical know-how about techniques
• Accelerate implementation by absorbing best
  practices and avoiding pitfalls
• Use external audits to create internal discipline
• Administering Competition Policy Responsibilities

12
Design Issues Who Should Cooperate?

• Government Enforcement Officials New and Old
  Systems
• Others Academics, Practitioners, NGOs?
• Other Models
• INDECOPI academic audits
• CADE public forums
• OECD studies cases and institutions
• audits

13
Stimulus for Domestic Reforms

• Experimentation Canada, EU, and Australia/NZ
• US
• Decentralization of authority
• Reverse Osmosis
• State Action
• Implications Resources and Intellectual
  Leadership

14
Conclusion

• Experimentation
• Progressive Development
• Prototyping
• Personal Relations Development