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The Case for Antitrust Civil Penalties

Harry First

New York University School of Law

Antitrust Law Journal, Forthcoming
NYU Law and Economics Research Paper No. 08-38
NYU School of Law, Public Law Research Paper No. 08-43

Federal antitrust law currently lacks one potentially useful remedy - civil penalties. Civil penalties are not novel, of course. They are used in other areas of federal economic regulation, in antitrust enforcement in other countries (particularly in Europe), and in a number of state antitrust systems. They have occasionally been proposed for U.S. antitrust law, although the Antitrust Modernization Commission and current federal enforcers have dismissed the idea.

In this paper I review what constitutes a civil penalty; describe the use of civil penalties by the European Commission, the states, and the FTC; and discuss the three potential remedial functions of civil penalties. I then argue for adding civil penalties to federal antitrust law, but my proposal is a limited one. I would add civil fines (but not other civil penalties), only for Section 2 cases (but not for Section 1 cases, despite some instances where they might be useful), and only for two types of monopolization - cases of systemic conduct, like Microsoft, and cases where there is no economic justification for the defendant's monopolizing conduct, for example, fraud on the Patent Office. I also propose that civil fining authority be given both to the Justice Department and the FTC, and that the civil fines not be paid to the Treasury, but be recycled to the agencies to support their enforcement budgets.

Number of Pages in PDF File: 41

Keywords: Antitrust, Section 2, monopolization, civil penalties, civil fines, remedies, optimal sanctions, Microsoft, Article 82, state antitrust enforcement, European Commission

JEL Classification: K21, K42, L12, L40, L41

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Date posted: July 22, 2008 ; Last revised: December 28, 2013

Suggested Citation

First, Harry, The Case for Antitrust Civil Penalties. Antitrust Law Journal, Forthcoming; NYU Law and Economics Research Paper No. 08-38; NYU School of Law, Public Law Research Paper No. 08-43. Available at SSRN: https://ssrn.com/abstract=1162353

Contact Information

Harry First (Contact Author)
New York University School of Law ( email )
40 Washington Square South
New York, NY 10012-1099
United States
212-998-6211 (Phone)
212-995-4760 (Fax)

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