Searching for a Modernized Voice: Economics, Institutions and Predictability in European Competition Law

Abstract

Uncertainty has been an increasingly central theme in discussions of competition law in Europe since the beginning of “modernization” efforts in the 1990s. This may seem paradoxical, because the modernization programs – both institutional and substantive – were intended to reduce the range of variation in competition law rules and thereby increase uniformity and predictability of results throughout the expanding EU, and they were justified by claims that they would achieve these benefits. Does the chorus of concerns about the lack of predictability in European competition law mean that the modernization processes were misguided or that they have failed? In my view, the answer is “no”. They have, however, transformed and relocated uncertainty in ways that are seldom adequately recognized and rarely addressed. Insufficient recognition of these transformations and their implications has wide-ranging and potentially serious implications for competition law in Europe and even for global competition law development. How then are we to reconcile the aims of modernization with its consequences?

A basic theme of this Article is that although the two forms of modernization have in some ways reduced uncertainty in EU competition law, they have also generated new forms of uncertainty that have sometimes concealed and at other times transformed it. The Article analyzes the impacts of “modernization” on competition law decision-making in the EU and thus on the substance of the law itself. It identifies the areas and forms of uncertainty that have resulted from these modernizations. While some commentators have noted elements of the relationship between modernization and uncertainty, that relationship may be more fundamental to understanding European competition law than is generally recognized.

The Article also examines the conceptual tools typically used in thinking about European competition law and demonstrates how these can be inadequate for the legal situation in the wake of modernization. Often they no longer provide adequate analysis of the complex processes of decision-making in Europe today. I then go on to suggest ways in which these tools can themselves be “modernized” to account for these changing complexities. In order to deal effectively with European competition law, it is necessary to use a perspective that is specifically designed to identify the factors that shape competition law decisions.

Keywords: competition law, economics, Europe, EU, modernization, uncertainty, comparative law, institutions, predictability

JEL Classification: K20, K21, K29, K30, K33, K39