With the recent result of the US Presidential election, we thought we might take a moment to give you our thoughts on how Barack Obama's presidency, which begins 20 January 2009, might affect antitrust/competition law enforcement in both the US and the European Union. It's very early yet to make any predictions, but President-elect Obama has already pledged to "reinvigorate" antitrust enforcement, and it will be interesting to see how this plays out in the coming four years of his administration.
Here's what Obama said last year in his statement submitted during the campaign about his pledges on antitrust enforcement:
"My Administration will . . .
- step up review of merger activity and take effective action to stop or restructure those mergers that are likely to harm consumer welfare, while quickly clearing those that do not.
- take aggressive action to curb the growth of international cartels
- look carefully at key industries to ensure that the benefits of competition are fully realized by consumers.
- ensure that insurance and drug companies are not abusing their monopoly power through unjustified price increases
- repeal the longstanding antitrust exemption for medical malpractice insurance.
- ensure that the law effectively prevents anticompetitive agreements that artificially retard the entry of generic pharmaceuticals onto the market, while preserving the incentives to innovate that drive firms to invent life-saving medications.
My administration will strengthen the antitrust authorities' competition advocacy programs to ensure that special interests do not use regulation to insulate themselves from the competitive process. Finally, my administration will strengthen competition advocacy in the international community as well as domestically. It will take steps to ensure that antitrust law is not used as a tool to interfere with robust competition or undermine efficiency to the detriment of US consumers and businesses."
These are some strong messages from Barack Obama. On the "other" side of the Atlantic, we expect antitrust enforcement to continue, with some added areas of emphasis. On the cartel side, it is likely that there will be continuous vigorous enforcement by the US Department of Justice (USDOJ) for price-fixing and customer/territorial allocation agreements between competitors. We also envision a renewed emphasis on monopolisation (essentially the American equivalent of an abuse of a dominant position), similar to the Clinton administration in the 1990's. On merger control clearance, which is a function at the federal level shared by the USDOJ and the Federal Trade Commission, we may see more challenges by the US government to deals, particularly transactions involving the technology, pharmaceutical, and financial sectors.
How will an Obama administration affect European competition enforcement? As a quick hint, just note how many times he uses the word "international" in his antitrust statement. If he stays true to his position paper, expect there to be ever-increasing levels of cooperation between the US and European/Irish regulators such as the joint US/European cartel investigations, including one of the fiercest weapons in the regulatory arsenal, the dreaded dawn raids. As a general matter, it is very likely that all aspects of competition law (cartels, abuse of dominance, and merger control) will see considerable cooperation between Europe and the US.
We'll get back to you in four years (and very likely much sooner) to let you know how well we did on our predictions!