Competition law and policy in the EC and UK

487 Pages·2009·2.343 MB·English

by  Barry J Rodger, Angus MacCulloch

Competition Law and Policy in the
EC and UK
Competition law, at both the EC and UK levels, plays an important and ever-
increasing role in regulating the conduct of businesses. Based on the premise
that open and fair competition is good for both consumers and businesses,
competition law prevents businesses from entering into anti-competitive
agreements and from abusing a dominant market position.
Competition Law and Policy in the EC and UK looks at how competition
law affects business, including: co-ordinated action; pricing behaviour;
takeovers and mergers; and state subsidies. It provides a clear guide to and
outline of the general policies behind, and the main provisions of EC and
UK competition law. Information is presented within a structured frame-
work, complete with a glossary of useful terminology.
This fourth edition has been revised and updated to take into account
developments since publication of the previous edition, including expanded
coverage of the regulation of cartels, the development of private enforce-
ment, the consideration of IP issues in Microsoft, and extended discussion of
UK competition law.
Barry J Rodger is a Professor at the Law School, University of Strathclyde.
Angus MacCulloch is a Senior Lecturer at the Law School, Lancaster
University.

Competition Law and Policy
in the EC and UK
Fourth Edition
Barry J Rodger and
Angus MacCulloch
Fourth edition published 2009
by Routledge-Cavendish
2 Park Square, Milton Park, Abingdon, Oxon, OX14 4RN
Simultaneously published in the USA and Canada
by Routledge-Cavendish
270 Madison Avenue, New York, NY 10016
This edition published in the Taylor & Francis e-Library, 2008.
“To purchase your own copy of this or any of Taylor & Francis or Routledge’s
collection of thousands of eBooks please go to www.eBookstore.tandf.co.uk.”
Routledge-Cavendish is an imprint of the Taylor & Francis Group,
an informa business
© 2009, 2004, 2001, 1998 Rodger, BJ and MacCulloch, A
Previous editions published by Cavendish Publishing Limited
First edition 1998
Second edition 2001
Third Edition 2004
All rights reserved. No part of this book may be reprinted or
reproduced or utilised in any form or by any electronic,
mechanical, or other means, now known or hereafter
invented, including photocopying and recording, or in any
information storage or retrieval system, without permission in
writing from the publishers.
British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
Rodger, Barry J.
Competition law and policy in the EC and UK / Barry J Rodger and
Angus MacCulloch.—4th ed.
p. cm.
1. Restraint of trade—European Union countries. 2. Antitrust
law—European Union countries. 3. Restraint of trade—Great Britain.
4. Antitrust law—Great Britain. I. MacCulloch, Angus. II. Title.
III. Title: Competition law and policy in the European Community and
United Kingdom.
KJE6456.R625 2008
342.24′072–dc22 2008021871
ISBN 0-203-92658-7 Master e-book ISBN
ISBN 13: 978–0–415–45848–1 (hbk)
ISBN 10: 0–415–45848–X (hbk)
ISBN 13: 978–0–415–45847–4 (pbk)
ISBN 10: 0–415–45847–1 (pbk)
ISBN 13: 978–0–203–92658–1 (ebk)
ISBN 10: 0–203–92658–7 (ebk)
To Susan, Lucy, Kirsty, Euan, Coll and Baby Mac

Contents
Table of cases xv
Table of legislation xxvii
Table of statutory instruments xxxi
Table of EC legislation xxxiii
Table of decisions xxxix
Abbreviations xlvii
Preface xlix
1 Introduction to competition policy and practice 1
Competition law background 1
Monopoly 2
Cartels 2
Mergers 3
‘Pure competition’ objective 3
State regulation – State aid 4
Economics of competition law and terminology 11
Politics of competition law 14
Competition policy objectives 16

Prevention of the concentration of economic power 16
Regulation of excessive profits and fairer distribution of wealth 17
Protection of consumers 17
Regional policy 18
Creation of unified markets and prevention of artificial barriers
to trade 19
Small is beautiful 19
US antitrust law and policy 20
Development of Community competition law 22
Development of UK competition law 24
Criminal law 24
Statutory development 27
viii Competition Law and Policy in the EC and UK
Comparison of competition law objectives under Community
and UK law and policy 29
Community competition policy objectives 29
UK competition policy objectives 31
Further reading 33
Competition policy general 33
The consumer interest and competition policy 33
EC competition policy development 33
UK competition policy development 34
US background 34
Discussion 34
2 Enforcement of Community and UK competition law 35
Introduction 35
EC enforcement framework 36
Outline 36
Decentralised Community competition enforcement 39
Relationship between Community and national law 43
The European Commission 46
Initiation 48
Decision-making 56
Rights of the defence 60
Review of Commission decision-making 62
Ancillary enforcement issues 65
Administrative enforcement in the UK 66
Introduction 66
The Competition Act 1998 67
Competition Appeal Tribunal (CAT) 74
The Enterprise Act 2002 76
Initiation 76
Investigation and reporting 79
Enforcement 80
Cartel offence investigations and director disqualification 81
Private enforcement of EC and UK competition law 83
Co-operation between courts and authorities 89
Globalisation and extraterritoriality 90
Extraterritoriality 90
Subject matter jurisdiction 91
Community competition law and extraterritoriality 92
Resistance to extraterritorial application 94
International co-operation and global competition rules 95
Contents ix
Further reading 97
Regulation 1/2003, The Network Notice and the ECN 97
UK competition law reform, the Competition Act 1998 and the
Enterprise Act 2002 97
Private enforcement 98
Globalisation 98
Discussion 98
3 The control of dominance 101
Introduction to Art 82 of the EC Treaty 101
Undertakings and the effect on trade between Member States 102
Dominant position 104
The relevant market 104
Dominance 110
Barriers to entry 112
Criticism 116
Abuse 117
Exploitative abuses 119
Excessive prices 119
Unfair conditions 120
The quiet life 121
Exclusionary abuses 121
Export bans 123
Pricing strategies 123
Tying and leverage 128
Mergers 129
Refusal to supply 130
Intellectual property rights 134
Collective dominance 136
Control of dominance in the UK 141

Introduction 141
Reform of UK anti-monopoly laws 141
The Competition Act 1998 – the Chapter II prohibition 143
Consistency with Community law 145
Guidelines on the prohibition 146
Practice and case-law to date 147
The Enterprise Act 2002 155
Investigation and information gathering 155
Market investigation references 156
The reference test: prevention, restriction or distortion of
competition 157
The reporting stage 158