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
Introduction In Ireland’s first bid-rigging case the Court of Appeal in its 20 June 2018 judgment decided that: (i) the €7,500 fine imposed by the Central Criminal Court on Brendan Smith was unduly lenient and raised it to €45,000; but (ii) that it was not unduly lenient of the Central Criminal Court to have imposed…
On 18 September 2018, the UK’s Competition and Markets Authority (the “CMA“) announced that Heathrow airport (“Heathrow“) will pay a fine of £1.6 million in relation to an infringement of UK competition law arising from a restriction included within a commercial lease.[1]See, www.gov.uk/government/news/heathrow-and-arora-admit-to-anti-competitive-car-park-agreement Importantly, this case marks the first occasion that the CMA has used…
The question of what constitutes a restriction of competition ‘by object’ has forever been intensely discussed and heavily litigated across the EU. As AG Kokott stated in her opinion in T-Mobile, the existence of an ‘object’ box is justified by the benefit of legal certainty and, not least, the need for conserving resources of competition…
The EU General Court recently upheld an infringement decision of the EU Commission (EC), in which the investment bank Goldman Sachs (GS) was found jointly and severally liable for violating Article 101 TFEU as a result of indirectly owning / holding a stake in Prysmian, a company who participated in cartel activities relating to high…
In July 2005, Germany adopted a new law providing that the limitation period for damage claims is suspended during the investigation of a competition authority (“Suspension Provision”). Ever since, it was unclear whether the Suspension Provision applies only to infringements committed after the new provision came into force, or whether it has retroactive effect. In…
Whistleblowers who expose breaches of European Union law will be afforded greater protection from retaliation by companies and public authorities under a draft law proposed by the European Commission in April 2018. The draft Directive protects those who report violations of competition, public procurement, and data protection rules, as well as misdeeds such as money…
In April 2018, the UK’s Competition and Markets Authority (the “CMA“) announced that two individuals would be disqualified from acting as directors for 3 and 3.5 years as a result of a company’s infringement of UK domestic competition law, specifically Chapter I of the Competition Act 1998 (the “Chapter I Prohibition“).[1] This case follows a…
The Senate has approved with minor amendments the Antitrust Bill (the “Bill”) that had been approved by the Chamber of Deputies. The Senate introduced minor amendments to a few articles of the Bill, though none of them are substantial. The amended Bill will now be considered by the Chamber of Deputies and approval is likely…
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The Polish competition authority applies the principle of in dubio pro reo in the case concerning a cartel on the domestic certification market (and refuses to use lie detecting devices) On 29 December 2017, the Polish competition authority – the President of the Office of Competition and Consumer Protection (the “OCCP President”) – penalised a…
