Can Blockchain Technologies Resolve the U.S. Antitrust Enforcement Problem?

U of Penn, Inst for Law & Econ Research Paper No. 22-36

25 U. Pa. J. Bus. L. ___ (forthcoming)

31 Pages Posted: 21 Sep 2022

See all articles by Giovanna Massarotto

Giovanna Massarotto

Center for Technology Innovation and Competition (CTIC), University of Pennsylvania; UCL Centre for Blockchain Technologies (UCL CBT)

Date Written: September 19, 2022

Abstract

The U.S. antitrust enforcement mechanism is criticized for being ill-adapted to ensuring competition in digital platforms. In the U.S., several bills have been introduced in Congress with the aim to create a new antitrust regulatory framework for digital platforms. This paper proposes a different solution by exploring the adoption of a blockchain system and smart contracts to make the present antitrust enforcement more efficient. In the U.S. approximately ninety percent of no-merger antitrust proceedings are settled by means of consent decrees. However, the consent decree procedure is criticized for a lack of transparency and there is often the need for more coordination among different antitrust enforcers in the definition of remedies. This begs the question of whether a distributed ledger can assist in making the consent decree mechanism more transparent by enhancing coordination and data consistency. Furthermore, verifying companies’ compliance with antitrust remedies enshrined in consent decrees is typically costly and time-consuming for an antitrust agency and these remedies can become ineffective. This paper investigates a blockchain system to tackle the lack of transparency and coordination in reaching the antitrust consent in the context of the FTC consent decree procedure. It further investigates the use of smart contracts and blockchain-based smart contracts to enforce antitrust remedies enshrined in antitrust consent decrees by using FTC remedies as an example. Antitrust does not really need a new regulatory framework, what it does need is to explore the adoption of new tools and resources to make the antitrust enforcement more efficient through a technologically managed solution.

Keywords: Antitrust law & policy, enforcement, regulation, Federal Trade Commission, FTC, blockchain, smart contracts, distributed ledgers, consent decrees, law & technology

JEL Classification: K21, K42, L49

Suggested Citation

Massarotto, Giovanna, Can Blockchain Technologies Resolve the U.S. Antitrust Enforcement Problem? (September 19, 2022). U of Penn, Inst for Law & Econ Research Paper No. 22-36, 25 U. Pa. J. Bus. L. ___ (forthcoming), Available at SSRN: https://ssrn.com/abstract=4224775

Giovanna Massarotto (Contact Author)

Center for Technology Innovation and Competition (CTIC), University of Pennsylvania ( email )

Philadelphia, PA 19104
United States

UCL Centre for Blockchain Technologies (UCL CBT) ( email )

London
United Kingdom

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