SciELO - Scientific Electronic Library Online

 
vol.11 issue3 author indexsubject indexarticles search
Home Pagealphabetic serial listing  

Services on Demand

Article

Indicators

Related links

  • On index processCited by Google
  • On index processSimilars in Google

Share


South African Journal of Economic and Management Sciences

On-line version ISSN 2222-3436
Print version ISSN 1015-8812

S. Afr. j. econ. manag. sci. vol.11 n.3 Pretoria Oct. 2008

 

ARTICLES

 

Characterising price fixing: A journey through the looking glass with ANSAC

 

 

Kasturi MoodaliyarI; Keith WeeksII

IOliver Schreiner School of Law, University of Witwatersrand, School of Law
IIEnforcement and Exemptions Division, South African Competition Commission

 

 


ABSTRACT

In February 2005 the Supreme Court of Appeal of South Africa ruled that in deciding whether firms have contravened section 4(1)(b) of the Competition Act 89 of 1998, as amended, by engaging in, for example, 'per se' illegal price fixing, the Competition Tribunal must admit evidence relating to the nature, purpose and effect of the horizontal agreement or practice in question. This article examines the economic and legal rationale, as well as the implications, for allowing an appropriate characterisation of conduct to determine whether such conduct falls within the per se prohibition. Firstly, we comment on the rationale behind the per se rule as a standard for the adjudication of certain types of conduct. We analyse a number of cases in the United States, which, post 1979, revolutionised the approach to the strict per se rule. Secondly, we examine how the per se standard is reflected in the particular structure found in section 4(1) of the Competition Act and evaluate whether it makes for a sufficiently robust application of the per se rule. Thirdly, the content of the Supreme Court decision regarding characterisation is critically examined with a view to assessing whether such characterisation is consistent with the policy objective of achieving maximum deterrence of hard core cartel behaviour like price fixing and market division. Finally, we explore and suggest (in the absence of a Tribunal decision) a possible framework, based on decision theory, for determining a method of characterisation that is consistent with the robust application of the per se standard and is in line with the Supreme Court ruling.

JEL: L41


 

 

“Full text available only in PDF format”

 

 

References

1 BECKNER, C.F. & SALOP, S.C. (1999) "Decision theory and antitrust rules," Antitrust Law Journal, 67(1): 41 - 67.         [ Links ]

2 CALKINS, S. (2000) "California Dental Association: Not a quick look but not the full Monty," Antitrust Law Journal, 67: 495-557.         [ Links ]

3 COMPETITION APPEAL COURT (2001) American Natural Soda Ash Corp et al. v the Competition Commission, Botswana Ash (Pty) Ltd et al., Competition Appeal Court Case Number 12/CAC/Dec01.         [ Links ]

4 COMPETITION TRIBUNAL (2000 and 2001) American Natural Soda Ash Corp et al. v the Competition Commission, Botswana Ash (Pty) Ltd et al., Competition Tribunal case number 49/CR/ Apr00 and 12/CAC/Dec01.         [ Links ]

5 CORREIA, E. (1998) "Joint ventures: Issues in enforcement policy" Antitrust Law Journal, 66: 737-771.         [ Links ]

6 DEVENISH, G.E. (1992) Interpretation of Statutes, Juta: Cape Town.         [ Links ]

7 DRIEDGER, E.A. (1983) "Construction of statutes: 150" in Devenish, G.E. (1992) Interpretation of Statutes (pg. 118), Butterworths: Toronto.         [ Links ]

8 FOX, E.M. (2002) Cases and Materials on the Competition Law of the European Union, Thomson West: St Paul, Minnesota.         [ Links ]

9 HOVENKAMP, H. (1999) Federal Antitrust Policy: The Law of Competition and its Practice (2nd ed.) West Publishing Company: St Paul, Minnesota.         [ Links ]

10 HYLTON K.N. (2003) Antitrust Law: Economic Theory and Common Law Evolution, Cambridge University Press: New York.         [ Links ]

11 MILES, J.J. (1997) "Joint venture analysis and provider controlled health care networks," Antitrust Law Journal, 66: 127-166.         [ Links ]

12 PITOFSKY, R. (1983) "Commentary: In defense of discounters: The no frills for a per se rule against vertical price fixing," Geo LJ, 71: 1487, 1489.         [ Links ]

13 STIGLER, G.J. (1952) "The case against big business", Fortune Magazine May 1952 in Michael D. Whinston (2006) Lectures in Antitrust Economics, (pg. 18), The MIT Press: Cambridge Massachusetts.         [ Links ]

14 SUPREME COURT OF APPEAL (2005) American Natural Soda Ash Co v The Competition Commission, Botswana Ash Company and others case no 554/03.         [ Links ]

15 WERDEN, G.J. (1999) Antitrust analysis of joint ventures: An overview', Antitrust Law Journal 66: 701-755.         [ Links ]

16 WHINSTON (2006) Lectures in Antitrust Economics, The MIT Press: Cambridge Massachusetts.         [ Links ]

Creative Commons License All the contents of this journal, except where otherwise noted, is licensed under a Creative Commons Attribution License