Competition Law and the E.U. and U.S. Approaches to Dominant Markets: Will the Gap Narrow?

Abstract

The chasm between the approaches of European Union competition law and United States antitrust law toward dominant markets, especially in high tech industries, could scarcely be greater, at least until quite recently. The leading example has involved Google, which the European Commission (the Commission) has hammered at least three times since 2017 with record fines totaling about €9 billion while the U.S. Federal Trade Commission concluded an investigation by finding that Google’s search engine benefitted consumers. The U.S. Department of Justice’s ground-breaking lawsuit in October 2020 against Google, however, along with a spate of other enforcement agency investigations of Big Tech and the rise of a new antitrust paradigm in America, may reduce the disparity. But many challenges await if the U.S. is to more align with Europe.

Initially, one should note that U.S. and E.U. competition law differs significantly. Statutory variances account for the divide in part, but more fundamental are divergent competition ideologies. The E.U. model favors governmental intervention to achieve better market outcomes while for the last 40 plus years the U.S., both in word and deed, has tended to laissez faire and an inherent trust in a market-based economy to achieve optimum competitive results.

Given that, this essay engages in a brief comparative look at the worlds’ two most significant competition regimes’ approaches to dominant market power and then takes a deeper dive into American antitrust history in order to assess how the States became so seemingly tolerant of a concentrated economy. It then considers recent developments in the United States that may signal a sea change for that tolerance.

Keywords: Competition law, European Union, Antitrust law, United States, Consumer welfare, Chicago School, Market dominance, Big Tech