Said SOUAM (Univ. de Paris 13)
“Commitments in Antitrust”
Date:Vendredi, 13 Novembre, 2009 – 11:00 – 12:30
Abstract : We analyze the impact of the introduction of a commitments procedure in terms of efficiency and deterrence in antitrust contexts. At the European level, this procedure consist in offering an immunity of fine to the firm in return for commitments that meet the competition concerns expressed to her. We first show that commitments are not proposed by firms who benefit much from the practice, but are always proposed in cases where the firm could be deterred with the usual trial sanction: this procedure necessarily lowers the deterrent effect of the competition authorities’ intervention. However, under asymmetric information, commitments may enhance the consumers’ surplus: they allow for shortened proceedings and avoid trial type-II errors. In addition, we find that the correlation between the firm’s gain from the practice and the consumers’ harm determines the optimal frequency of use of the commitments procedure: monotonic correlations push to pure strategies from the competition authority, while a stochastic use may be optimal otherwise. Deriving some comparative statics, we finally show that the commitments procedure is not always an alternative to a lack of efficiency of the competition authority’s intervention: trial’s expected sanctions and commitments may be complementary tools.