Whose Regulation, Which Competition?
Edited by Hanns Ullrich
Chapter 11: Efficiency Claims in EC Competition Law and Sector-Specific Regulation
Damien Geradin* I INTRODUCTION Many competition lawyers and economists argue that the primary objective of competition law regimes is to promote economic efficiency.1 Yet few of these regimes define what should be understood by economic efficiency. For instance, although this concept is referred to in an increasingly large number of regulations, guidelines, and so on, EC competition law does not offer any precise definition of economic efficiency. The problem is made more serious by the fact that economists do not necessarily agree on the meaning of efficiency and that, in a given proceeding, the economic consultants of both parties will often disagree over the efficiency or inefficiency of a given practice or behaviour. This issue has become of considerable importance as economic analysis is now at the core of competition law analysis.2 Economic analysis not only plays a role in determining the types of agreements/mergers that create competition law concerns but also the types of justification that can be used to justify such agreements/mergers. When asked to examine a restrictive agreement or a merger, the test to be performed by competition authorities essentially amounts to determining whether the negative effects of the agreement/transaction on competition are more than compensated for by ‘efficiencies’ taking the form of the production of new and/or better products, the realization of * Member of the Brussels bar. Professor of Law and Director of the Institute for European Legal Studies, University of Liège, Professor and Director of the Global Competition Law Centre, College of Europe, Bruges...
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