Book contents
- Frontmatter
- Contents
- List of figures
- List of tables
- List of abbreviations
- Table of legislation
- Table of equivalences
- Acknowledgments
- 1 Introduction
- 2 Horizontal restrictions
- 3 Abuse of dominance
- 4 Licensing
- 5 Vertical restrictions
- 6 Joint ventures and alliances
- 7 Restrictions to competition by Member States
- 8 Mergers and acquisitions
- Annex I Decisions related to procedural issues
- Annex II Table of landmark decisions described in the book
- Annex III Table of mergers blocked by the European Commission in chronological order
- Annex IV Table of landmark merger decisions described in the book in alphabetical order
- Annex V Table of antitrust decisions in alphabetical order
- Bibliography
- Index
- References
2 - Horizontal restrictions
Published online by Cambridge University Press: 04 August 2010
- Frontmatter
- Contents
- List of figures
- List of tables
- List of abbreviations
- Table of legislation
- Table of equivalences
- Acknowledgments
- 1 Introduction
- 2 Horizontal restrictions
- 3 Abuse of dominance
- 4 Licensing
- 5 Vertical restrictions
- 6 Joint ventures and alliances
- 7 Restrictions to competition by Member States
- 8 Mergers and acquisitions
- Annex I Decisions related to procedural issues
- Annex II Table of landmark decisions described in the book
- Annex III Table of mergers blocked by the European Commission in chronological order
- Annex IV Table of landmark merger decisions described in the book in alphabetical order
- Annex V Table of antitrust decisions in alphabetical order
- Bibliography
- Index
- References
Summary
Introduction
The first important category of competition concerns is that of horizontal constraints among firms that have as their object or effect the prevention, restriction, or distortion of competition. This category includes hardcore cartel cases of price fixing and market sharing, but also more sophisticated anticompetitive horizontal agreements such as joint sales agencies, agreements on limiting marketing activities, capacity restrictions and other aspects of production, information sharing on prices and sales, service and distribution agreements, export cartels, and exclusionary practices toward entrants. It further extends to specialization and licensing agreements, trademarks, agreements on (technical) standards, strategic alliances, trade associations, and the joint organization of exhibitions and fairs. While some of these forms of cooperation may have positive welfare effects, they also have an inherent danger of leading to collusion.
Setting up and maintaining a collusive agreement can be difficult, since a number of factors can undermine the successful implementation of a cartel agreement. It is key for cartel success to create trust among its participants. It is generally costly for colluders to monitor and control the behavior of other parties to the agreement. This is important, because each cartel member has an incentive to free ride on the collusive agreement by undercutting the collusive price level to unilaterally increase profits. Therefore, the success of collusion depends among other things on quick detection of deviating behavior and effective punishment mechanisms.
- Type
- Chapter
- Information
- European Commission Decisions on CompetitionEconomic Perspectives on Landmark Antitrust and Merger Cases, pp. 26 - 112Publisher: Cambridge University PressPrint publication year: 2010
References
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