Why Competition Law

A competition lawyer can play many different roles in his or her career. For example, today the Treaty of Lisbon prohibits anti-competitive agreements in Article 101(1), including prices. In accordance with Article 101(2), such agreements are automatically null and void. Article 101(3) provides for exceptions where the collusion is intended for distribution or technological innovation, gives consumers a `fair share` of the benefit and does not include unreasonable restrictions that could eliminate competition anywhere (or that are compatible with the general principle of Union law on proportionality). Article 102 prohibits abuses of a dominant position[37], such as price discrimination and exclusive distribution. In accordance with Article 102, European Council regulations may regulate mergers between companies (the current Regulation is Regulation (EC) No 139/2004). [38] The general test is whether a concentration (i.e. a merger or acquisition) with a Community dimension (i.B affects a number of EU Member States) could significantly impede effective competition. Articles 106 and 107 provide that the right of Member States to provide public services is not impeded, but that, otherwise, public undertakings must respect the same principles of competition as undertakings. Article 107 establishes a general rule according to which the State may not assist or subsidize private parties in the distortion of free competition and provides for exceptions for charitable organizations, regional development objectives and in the event of a natural disaster. [Citation needed] Competition law exists to maintain competition in the market. Especially in the current climate, where trade with other countries is at the forefront for many, competition law is a central issue.

Other examples include linking the purchase of one product to another, predatory pricing, and refusing to deal with another company in a way that restricts competition. A group of economists and lawyers, largely associated with the University of Chicago, advocates an approach to competition law guided by the thesis that certain actions originally considered anti-competitive could in fact promote competition. [66] The U.S. Supreme Court has used the Chicago School approach in several recent cases. [67] A view of the Chicago School`s antitrust approach can be found in the books Antitrust Law[68] and Economic Analysis of Law of the United States Circuit Court of Appeals, Judge Richard Posner. [69] The Sherman Act of 1890 was intended to prohibit the restriction of competition by large firms that worked with competitors to determine outputs, prices and market shares, first through pools and then through trusts. Trusts first appeared in U.S. railroads, where the capital requirements of railroad construction excluded competitive services in sparsely populated areas at the time. This trust has enabled the railways to discriminate against the tariffs and services imposed on consumers and businesses and to destroy potential competitors. Different trusts may be dominant in different industries. The Standard Oil Company Trust controlled several markets in the 1880s, including the heating oil, lead, and whiskey market. [31] Many citizens became sufficiently aware and publicly concerned about how trusts were negatively affecting them that the law became a priority for both major parties.

A major concern of this law is that competitive markets themselves should ensure the primary regulation of prices, products, interest and profits. Instead, the law prohibited anti-competitive practices and codified the common law trade restriction doctrine. [32] Professor Rudolph Peritz argued that competition law in the United States has evolved around two sometimes contradictory concepts of competition: first, that of individual liberty, free from state interference, and second, a fair competitive environment without excessive economic power. Since the passage of the Sherman Act, the application of competition law has been based on various economic theories adopted by the government. [33] According to Mill, there has been a shift in economic theory that has emphasized a more precise and theoretical model of competition. A simple neoclassical model of free markets asserts that the production and distribution of goods and services in competitive free markets maximizes social prosperity. .