The Deterrent Effects of National AntiCartel Laws: The International Vitamins Cartel

1
The Deterrent Effects of National Anti-Cartel
LawsThe International Vitamins Cartel

• Julian L. Clarke and Simon J. Evenett
• World Trade Institute,
• University of Bern

2
The Issues

• Many nations adopted competition laws in the
  1990s some strengthened existing laws
• But little is known about costs and benefits of
  these laws
• Debates at OECD and WTO
• Our lens International Vitamins Cartel
• Worldwide cartel, 1989-1999
• US Federal authorities took action in 1999
• US fines exceeded 900 million

3
Vitamins cartel targeted nations without active
cartel enforcement
4
The deterrent effect of cartel laws was large in
some jurisdictions
5
Policy implications

• Cartel laws can reduce the harm done by cartels
  that do formas well as deterring some cartels
  formation in the first place
• Some international cartels are so large that
  deterrent effects may go a long way to cover
  current enforcement outlays
• Strengthens case for enactment and proper
  implementation of these laws
• Caveats