Chapter 2: Uncovering Cartels: Understanding the Approaches and Complexities of Collusive Agreements
2. Uncovering cartels: understanding the approaches and complexities of collusive agreements Agreements between private companies have long constituted a regular aspect of business life. Such agreements have been designed to provide benefits for the undertakings concerned and to offer them new opportunities. There are occasions, however, when certain forms of agreements, although they may indeed be advantageous for the parties concerned, have adverse and negative effects on rival competitors, work to the detriment of consumers and undermine the competiveness of the economy in general. The issue centres on how far such arrangements impinge on the competitive process and the creation of competitive markets. Attitudes and views have differed over time, but in today’s economic and political climate one particular form of agreement, namely the cartel, is now considered to be the most particularly damaging form of all anti-competitive behaviour. Cartels provide an excellent illustration of covert agreements which have usually been constructed to secure profit maximisation, and by their nature deliberately set out to thwart the competitive process.1 Two essential facts about cartellisation and collusive activities should always be borne in mind. Firstly, recourse to cartellisation is not a new development, and for some commentators cartel formation stretched as far back as Ancient Egypt (Herlitzka, 1963: 121). Cartels have impacted ever since on the operation of markets and the positions of other actors and traders. Whether such impact may be termed negative or positive is open for debate. Any comparative and historical examination reveals that perceptions (ranging from toleration, agnosticism...
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