The Inefficiency of Quasi-Per Se Rules: Regulating Information Exchange in EU and U.S. Antitrust Law

57:1 American Business Law Journal 45-111 (2020)

49 Pages Posted: 20 Dec 2019 Last revised: 14 May 2020

See all articles by Kenneth Khoo

Kenneth Khoo

National University of Singapore (NUS) - Faculty of Law

Jerrold Soh

Singapore Management University School of Law; Singapore Management University - Centre for AI & Data Governance

Date Written: July 31, 2019

Abstract

It is well understood that the exchange of information between horizontal competitors can violate competition law provisions in both the European Union and the United States; namely, Art 101 TFEU and Section 1 of the Sherman Act. However, despite ostensible similarities between EU and U.S. antitrust law concerning inter-firm information exchange, substantial differences remain. In this article, we make a normative argument for the U.S. antitrust regime’s approach, on the basis that the United States’ approach to information exchange is likely to be more efficient than the relevant approach under the EU competition regime. Using economic theories of harm concerning information exchange to understand the imposition of liability in relation to “stand-alone” instances of information exchange, we argue that such liability must be grounded on the conception of a prophylactic rule. We characterize this rule as a form of ex ante regulation and explain why it has no ex post counterpart in antitrust law. In contrast to the U.S. antitrust regime, we argue that the implementation of such a rule pursuant to EU competition law leads to higher error costs without a significant reduction in regulatory costs. As a majority of jurisdictions have competition law regimes that resemble EU competition law more closely than U.S. antitrust law, our thesis has important implications for competition regimes around the world.

Keywords: Antitrust, Competition Law, Information Exchange, Collusion

JEL Classification: K21, L41, K40

Suggested Citation

Khoo, Kenneth and Soh, Jerrold, The Inefficiency of Quasi-Per Se Rules: Regulating Information Exchange in EU and U.S. Antitrust Law (July 31, 2019). 57:1 American Business Law Journal 45-111 (2020), Available at SSRN: https://ssrn.com/abstract=3498616

Kenneth Khoo (Contact Author)

National University of Singapore (NUS) - Faculty of Law ( email )

469G Bukit Timah Road
Eu Tong Sen Building
Singapore, 259776
Singapore

Jerrold Soh

Singapore Management University School of Law ( email )

55 Armenian Street
Singapore, 179943
Singapore

Singapore Management University - Centre for AI & Data Governance ( email )

55 Armenian Street
Singapore
Singapore

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