Table of Contents

State-Initiated Restraints of Competition

State-Initiated Restraints of Competition

ASCOLA Competition Law series

Edited by Josef Drexl and Vicente Bagnoli

States influence competition in the market in various ways. They often act themselves as market participants through state-owned enterprises. They regulate markets and specific sectors of the economy such as public utilities in particular. In some instances, market regulation explicitly aims to promote competition in the market. In other instances, regulatory schemes and decisions may inadvertently distort competition or openly promote conflicting objectives and even anti-competitive goals. Furthermore, states can distort competition among firms when they act as purchasers of goods and services as well as when they grant subsidies to individual firms. This book assembles contributions by competition law scholars who present new insights on the diversity of problems and challenges arising from state-initiated restraints of competition in jurisdictions from all around the world, not only including the EU and the US, but also Latin American countries, China, India and Australia.

Chapter 11: Intellectual property rights: from state-initiated restraints of competition to state-initiated competition

Rudolph J. R. Peritz

Subjects: law - academic, competition and antitrust law


This chapter addresses two questions about US intellectual property rights as state-initiated restraints of competition. First, what explains the reversal of fortunes, the decline of antitrust, the elevation of IPRs to primary importance, and, in consequence, a weakened commitment to free competition? Second, how can the benefits of free competition be re-introduced into the policy debates over IPRs, debates concerning the public interests in advancing economic growth and promoting fair distribution of its benefits? After discussing the decline of antitrust, this chapter offers a surprising source for re-introducing competition policy and, with it, an entirely new approach to resolving a long-standing tension between IPRs and antitrust at its breaking point – the deep conflict between a patent holder’s fundamental right to exclude and the antitrust prohibition against a monopolist’s refusal to deal. Intellectual property ownership has become a critical issue in current debates concerning not only national competition policies but also international trade and development, whether about the availability of generic pharmaceuticals, the impact of TRIPS on developing countries, the adoption of the controversial Anti-Counterfeit Trade Agreement (ACTA), or corporate acquisitions of large patent portfolios.

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