Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Baer calls on foreign antitrust authorities to eschew non-competition issues, (Sep 12, 2014)
By Jeffrey May, J.D.
The international competition community is making progress in moving towards convergence on due process and transparency, William Baer, Assistant Attorney General in charge of the Department of Justice Antitrust Division, told attendees of Fordham Law's 41st Annual International Antitrust Law & Policy Conference today in New York City. However, he called on enforcers to continue working to reach a consensus on the principle that antitrust decisions should be based solely on competition issues. Enforcement decisions should not be used to promote domestic or industrial policy goals, protect state-owned or domestic companies from foreign competitors, or create leverage in international trade negotiations, Baer advised.
In remarks, entitled “International Antitrust Enforcement: Progress Made; Work to Be Done,” Baer explained that the United States and European Union have been able to build a close and constructive relationship because their approach to antitrust enforcement is based on common values. Both share a core belief that antitrust enforcement must protect and promote competition and consumer welfare.
Baer acknowledged that it may be difficult for jurisdictions that are early in the process of moving from a planned economy to a free market system to avoid non-competition issues. These jurisdictions may be shifting their focus from promoting producer welfare to consumer welfare or have state-owned and domestic corporations. However, these agencies run the risk of losing the trust and confidence of businesses that are looking to enter or expand in their markets, unless they focus solely on the competitive effects and consumer benefits of the transaction or conduct being reviewed. Such a focus will assuage fears that the playing field might not be level, he observed.
This is especially important in antitrust matters involving intellectual property (IP) rights. “There may be resistance to adopting this approach in jurisdictions whose economies are shifting from being innovation takers to being innovation producers,” said Baer. “However, enforcers in these jurisdictions should understand that in the long run it is in a jurisdiction’s best interest to promote a system that rewards innovators by protecting intellectual property rights while preserving competitive markets.”
Baer suggested that the following principles should be applied in antitrust matters involving IP rights:
recognize that IP rights do not necessarily confer market power;
limit enforcement actions to owners of IP rights with market power that engage in collusive or exclusionary conduct that harms competition;
protect competition rather than competitors; and
do not use antitrust enforcement involving IP rights to implement domestic or industrial policies.
While Baer applauded recent international antitrust convergence efforts, he said that the enforcement community needs to continue working to find common ground on the principle that enforcement decisions should be based solely on the competition issues.
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