A cartel is a formal agreement among firms in an oligopolistic industry.
Cartel members may agree on such matters as prices, total industry output, market shares, allocation of customers, allocation of territories, bid-rigging, establishment of common sales agencies, and the division of profits or combination of these. Cartel in this broad sense is synonymous with “explicit” forms of collusion. Cartels are formed for the mutual benefit of member firms.
The theory of “cooperative” oligopoly provides the basis for analyzing the formation and the economic effects of cartels. Generally speaking, cartels or cartel behaviour attempts to emulate that of monopoly by restricting industry output, raising or fixing prices in order to earn higher profits.
Source: OECD
Any company or organisation that finds itself as the ‘middle man’ in contacts between competitors or which has dealings with such a middleman must take care, as a flurry of recent EU cases has demonstrated. Any company that directly facilitates those contacts is in very dangerous waters indeed. Cartel Facilitation In AC Treuhand, the European…
If the recent Wahl opinion could have instilled some doubts about the responsibility of cartel facilitators under Article 101 of the Treaty on the Functioning of the European Union (TFEU),[1]Advocate General Wahl Opinion, AC Treuhand v Commission, ECLI:EU:C:2015:350 the debate has been brought to an end with the Court of Justice of the European Union’s…
Co-authored by Patrick Harrison and Lara Kaplan, Sidley Austin LLP. The European Commission (“Commission”) introduced its settlement procedure for cartel cases back in 2008.[1]Commission Regulation (EC) No 662/2008 of 30 June 2008 amending Regulation No 773/2004, as regards the conduct of settlement procedures in cartel cases (OJ 2008 L171) (“the Settlements Notice”). The main aims? …
The Polish Competition Authority, which is the President of the Office of Competition and Consumer Protection (the “PCA”), has announced that, starting from 1 September 2015, it will be issuing statements of objections to undertakings and will set up an internal evaluation committee. These new tools are, in PCA’s own words, designed to “strengthen procedural…
On 9 July 2015, the Court of Justice of the European Union (“ECJ”) issued an important judgment[1]Case C-231/14P – InnoLux v European Commission, judgment of 9 July 2015. concerning the basis on which cartel fines by the European Commission should be calculated for vertically integrated companies. The judgment endorses the power of the European Commission…
73d Lunch Talk of the Global Competition Law Center Thursday, March 19, 2015 from 12:00 PM to 2:00 PM Joint and Several Liability for Cartel Fines: Lessons from Gigaset and Siemens Austria Onno BROUWER, Freshfields Ralf SAUER, Legal Service, European Commission Moderator: Bernd MEYRING, Linklaters and GCLC Programme: 12:00 – 12:30: Sandwich lunch and socializing…
BY CHARLES TINGLEY, DAVIES WARD PHILLIPS & VINEBERG LLP On February 4, 2015, the Ontario Superior Court of Justice ruled that relevant factual information proffered to the Crown in order to qualify for immunity or leniency under the Competition Bureau’s cartel Immunity and Leniency Programs is not protected from disclosure to accused persons by either…
The Competition and Markets Authority (“CMA”) has recently published its draft Annual Plan for 2015/2016, its second year of operation after assuming the functions of the Competition Commission and the competition functions of the Office of Fair Trading (“OFT”) on 1 April 2014. Together with a Strategic Assessment of the risks that consumers and markets…
Co-authored by Jay Modrall and Shan Hu. The authors of this article would like to thank Marc Waha, partner at Norton Rose Fulbright, for his insightful comments. 1 Introduction The Chinese National Development and Reform Commission (NDRC) has recently stepped up its cartel enforcement activities and for the first time has published non-confidential versions of…
On 10 June 2014, the Polish Parliament adopted a significant set of amendments to the Polish Competition Law Act (the “Act”). Having received Presidential approval on 30 June 2014, the amended Act is now waiting for publication. The changes are expected to come into force relatively soon. The amendments will take effect 6 months after…
