Edited by Josef Drexl and Fabiana Di Porto
Chapter 2: Anti-anti regulation: the supplanting of industry regulators with competition agencies and how antitrust suffers as a result
AbstractSector-specific regulation has a long history and wide application. Despite this (and perhaps because of it), in recent years much regulation has been curtailed or criticized, with competition agencies taking the place of regulators in limiting industry giants and preventing abuse. This trend stems both from the disrepute affecting regulatory capture and the increasing belief in market forces and competition as sufficient constraints on problematic behaviour. While practitioners and scholars of competition law may applaud the increase of their purview, what often escapes attention is the price competition law pays in the process. Specialization and context-specific knowledge are being overlooked, while the broad rules of competition law are applied well beyond their true effectiveness. This chapter outlines the main justifications for preventing the expansion of competition law beyond its core domain, and the prices both policy and agencies pay as a result of this expansion. It is not merely the industry-specific application which suffers, but core concerns about the framework of competition policy and the rules and standards applied. Especially in today’s networked world, over-extending competition law might cause agency failure and dilution of expertise in a way that is harmful to core concerns.
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