Formal Rules Versus an Economic Approach in Dealing with Cartels: The Need for More Coherence in European Competition Law

Romanian Journal of European Affairs, Vol. 11, No. 4, 2011

11 Pages Posted: 22 Dec 2011  

Musetescu Radu Cristian

Bucharest Academy of Economic Studies

Andreas Stamate

affiliation not provided to SSRN

Date Written: December 21, 2011

Abstract

Cartelizing is today among the most hunted business conduct in the world. Competition authorities from the countries where these statutes were adopted embrace the wisdom that such agreements between competitors are unquestionably anti-competitive. As opposed to other business practices, cartel agreements seem to offer an undeniable proof of intent that confers comfort for those who are investigating and prosecuting them. A cartel is today qualified as per se illegal. No further proof is needed but the formal agreement and the shared intentions. They are, at least until now, the only business practice that has lead, in certain jurisdictions, to jail terms and criminal record for individuals who were engaged in their negotiation and implementation. However, cartels are business practices that do not fundamentally aggress against any property right. From a public policy perspective, the harsh attitude towards cartels is lacking a theoretical coherence. Today, when competition policies all over the world and especially in the European Union are gradually transiting towards a more economic approach to evaluating the welfare effects of business practices, reassessing cartels is a critical imperative in the effort for a more coherent and reasonable public policy.

Keywords: competition policy, cartels, per se rules, economic approach

JEL Classification: D43, D6

Suggested Citation

Cristian, Musetescu Radu and Stamate, Andreas, Formal Rules Versus an Economic Approach in Dealing with Cartels: The Need for More Coherence in European Competition Law (December 21, 2011). Romanian Journal of European Affairs, Vol. 11, No. 4, 2011. Available at SSRN: https://ssrn.com/abstract=1975322

Musetescu Radu Cristian (Contact Author)

Bucharest Academy of Economic Studies ( email )

6, Romana Square, District 1
Bucharest, 010374
Romania

Andreas Stamate

affiliation not provided to SSRN

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