International Cooperation in Competition Policy: The US Experience William E. Kovacic U.S. Federal Trade Commission May 15, 2002

Presentation Theme US Participation in International Competition Policy Programs Focus: Development of Institutions Disclaimer: Personal Views.

Resources Institutional Foundations for Economic Law Reform in Transition Economies, 77 Chicago-Kent Law Review 265 (2001). Evaluating Antitrust Experiments, 9 George Mason Law Review 843 (2001). Boeing-McDonnell Douglas Merger, 68 Antitrust Law Journal 805 (2001).

Organization Development of Competition Laws: Trends and Rationales Institutional Multiplicity Methods of Cooperation Some General Lessons

Trends in Development of Competition Laws Yesterday – Status Quo in 1950: US – Status Quo in 1975: US and EU Today: Over 90 Laws Worldwide – 50 new laws in emerging markets since 1975 – Major reforms in older systems Tomorrow: Over 100 Laws by 2010 Unique Opportunity for Comparative Study

Consequences of Multiplicity Divergence Concerning – Substantive Standards: e.g., GE/Honeywell – Processes: e.g., Role of Judiciary in Merger Review – Institutional Capability: Developed versus Developing Countries (cf. International Networks).

Convergence: Models “Top Down” Imposition of Binding Norms “Bottom Up” Evolution of Norms – Decentralized experimentation – Identification of best practices – Opting in or agreement on norms – Example: Merger Guidelines

Cooperation: Means Bilateral: Seven US Agreements IAEAA: One Agreement Multilateral Global: OECD, UNCTAD, WTO, ICN Multilateral Regional: FTAA, Caricom, Comesa, APEC, ASEAN, Mercosur, Andean Pact, W. African Monetary Union Technical Assistance

Key Elements Build Personal Relationships Examine Specific Cases Working Groups Regular Coordination Progressive Elaboration – Agreements in General – Bilaterals

Cooperation and Convergence Building an Intellectual Consensus Devoting Resources to Institution Building Prediction: A Gradual Progression

Benefits of Comparative Study Comparative Perspectives Can Help: – Teach concepts – Transfer practical know-how about techniques – Accelerate implementation by absorbing best practices and avoiding pitfalls – Use external audits to create internal discipline Administering Competition Policy Responsibilities

Design Issues: Who Should Cooperate? Government Enforcement Officials: New and Old Systems Others: Academics, Practitioners, NGOs? Other Models – INDECOPI: “academic audits” – CADE: public forums – OECD studies: cases and institutions audits

Stimulus for Domestic Reforms Experimentation: Canada, EU, and Australia/NZ US – Decentralization of authority – Reverse Osmosis – State Action – Implications: Resources and Intellectual Leadership

Conclusion Experimentation Progressive Development – Prototyping Personal Relations Development