Continental Drift in the Treatment of Dominant Firms: Article 102 TFEU in Contrast to § 2 Sherman Act

34 Pages Posted: 13 Jul 2013

See all articles by Pierre Larouche

Pierre Larouche

Université de Montréal; Center on Regulation in Europe (CERRE)

Maarten Pieter Schinkel

University of Amsterdam - Department of Economics; Tinbergen Institute

Date Written: May 2013

Abstract

In this paper we compare the concepts of monopolization and abuse of dominance as in §2 of the Sherman Act and Article 102 of the TFEU, respectively. After identifying a number of distinctive features in wording and interpretation – including the special responsibility of the dominant firm, competition of the merits and protection of the competitive process – we discuss three lines of argument to explain these differences. The first builds on ordo-liberalism, with its concern for the absence of market power and for the resilience of competitive markets, which influenced EU competition law from the very beginning. The second line of argument derives from the observation that public competition law enforcement is fallible, which self-enforcement could remedy. The third argument explains some of these differences via innovation, whereby Article 102 would reflect a European perspective on innovation. We subsequently return to the underutilized EU category of exploitative abuses and argue that economic techniques developed in the context of damages litigation could open it up for future enforcement in a way that would be in line with ordo-liberal principles, properly understood.

Keywords: monopolization, abuse of dominance, ordo-liberalism, error-risk analysis

JEL Classification: B150, K210, L410

Suggested Citation

Larouche, Pierre and Schinkel, Maarten Pieter, Continental Drift in the Treatment of Dominant Firms: Article 102 TFEU in Contrast to § 2 Sherman Act (May 2013). TILEC Discussion Paper No. 2013-020. Available at SSRN: https://ssrn.com/abstract=2293141 or http://dx.doi.org/10.2139/ssrn.2293141

Pierre Larouche (Contact Author)

Université de Montréal ( email )

Montreal, Quebec H3T 1B9
Canada

Center on Regulation in Europe (CERRE) ( email )

Rue de l'Industrie 42
Brussels, 1040
Belgium

Maarten Pieter Schinkel

University of Amsterdam - Department of Economics ( email )

Roetersstraat 11
1018 WB Amsterdam
Netherlands
+31 20 525 7132 (Phone)
+31 20 525 5318 (Fax)

Tinbergen Institute ( email )

Gustav Mahlerplein 117
Amsterdam, 1082 MS
Netherlands

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