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
Mark Katz and Alysha Manji-Knight Introduction Combatting corruption in public procurement is a top enforcement priority of the Canadian government. Canada’s Competition Bureau (“Bureau”) plays a major role in this effort, through its investigation and prosecution of cartel offences under the Competition Act (“Act”). Another key weapon in this battle is the Canadian government’s “Integrity…
The result is in. The United Kingdom will leave the European Union, with profound economic, social, and, naturally, legal consequences. As the dust settles, lawyers practising across a wide range of specialisms will be squinting into their crystal balls to identify what the consequences of Brexit will be across the disciplines that are now matters…
On 1 March 2016, the Belgian Competition Authority (“BCA”) adopted its new Leniency Guidelines (“the 2016 Leniency Guidelines”). The 2016 Leniency Guidelines replace the 2007 Notice of the Competition Council on Immunity from Fines and Reduction of Fines in Cartel Cases (“the 2007 Leniency Notice”). The new guidelines were published in the Belgian Official Gazette…
In all competition investigations, it is inevitable that the parties under investigation, and often also third parties, will receive numerous information requests and demands to produce documents and provide information. Such requests may be either formal or informal in nature. These are often burdensome, requiring the provision of substantial information and documentation in a short…
Longstanding CCPC dawn raid practice to copy electronic data (including entire email accounts) for later off-site review by investigators is unlawful according to a recent ruling of the Irish Competition Court. Bulk copying of e-files “will almost certainly, perhaps inevitably” capture material outside the scope of any investigation, the court found. Accordingly, CCPC search of…
Once upon a time, but not so long ago, a certain company received a request for information (“RFI”) from the European Commission (in the form of a binding decision). This RFI was nothing like any company had ever seen. It was 90 pages long, contained 11 sets of numerous detailed questions, and demanded a rapid…
In her recent opinion, Advocate General J. Kokott went over one of the most important elements for companies facing cartel sanction: the fines calculation method. If this specific point is often challenged by the parties, the Court of Justice of the European Union’s (ECJ) upcoming judgement Pilkington Group Ltd and Others v European Commission may…
by Anita Banicevic and Mark Katz[1] 2015 saw a number of interesting developments in cartel enforcement in Canada, the most important of which were setbacks suffered by Canada’s competition authorities in two high profile prosecutions. We discuss these and other developments below, following a brief overview of the cartel enforcement regime in Canada. Cartel Enforcement…
Co-authored by Patrick Harrison and Audrey Silvain, Sidley Austin LLP. There are few distinctions more important in EU competition law than that between the notion of a restriction “by object” – where a regulator need not demonstrate that conduct had anti-competitive effects – and the notion of a restriction “by effect,” where a regulator…
A recent report from the National Audit Office has recommended that the Competition and Markets Authority (“CMA”) increase the number of cartel investigations it carries out. A number of recent statements made by senior officials in the CMA’s Cartels and Criminal Group (“CCG”) suggest that the CMA is listening very carefully. The case for more…
