International Competition Network Adopts Recommended Practices to Improve Merger Analysis, Creates New Virtual University, and Addresses Complex Unilateral Conduct Issues

Chairman Jon Leibowitz and Commissioner William Kovacic Promote Antitrust Collaboration and Convergence at Istanbul Conference)

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Today, at the ninth annual International Competition Network conference in Istanbul, Turkey, the ICN adopted Recommended Practices for substantive merger analysis, approved a pilot project for a virtual university on competition law and practice, and held discussions about the analysis of refusal to deal and margin squeeze conduct under unilateral conduct laws, the Federal Trade Commission announced today.

The ICN conference, hosted by the Turkish Competition Authority, was held on April 27-29, 2010. Over 500 delegates participated, representing more than 80 antitrust agencies from around the world, and included competition experts from international organizations and the legal, business, consumer, and academic communities. FTC Chairman Jon Leibowitz and Commissioner William Kovacic, and Assistant Attorney General at the Department of Justice’s Antitrust Division Christine Varney were among the U.S. delegates who participated in the conference. The conference showcased the recent work of ICN working groups on mergers, unilateral conduct, cartels, competition advocacy, and competition agency effectiveness.

“The ICN provides a platform for furthering international cooperation. It helps us to strengthen relationships that serve us in addressing cross-border conduct that harms U.S. consumers, and also gives us a forum to exchange experience,” Chairman Leibowitz said. “Through our dialogue on operational issues such as strategic planning, we are learning innovative ways from our foreign counterparts that we plan to take home to Washington.”

The ICN, founded in 2001, increasingly serves as the leading forum for these exchanges of better practices. Commissioner Kovacic, the ICN’s Vice Chair for Outreach, is an important facilitator of this exchange, creating the ICN’s blog and heading the network’s self assessment that will prepare the ICN for the next 10 years. At the conference, Kovacic reported, “This year’s annual conference took major steps to improve the ICN’s work in its second decade. The members made a strong commitment to examine the ICN’s experience, identifying areas for improvement, and ensuring that the network makes the best contributions to effective competition policy.” Kovacic’s work served as the basis for an in-depth session addressing the performance and results of the ICN.

The conference highlighted the work of the Unilateral Conduct Working Group, which was established to promote analytical convergence and sound enforcement of laws governing unilateral conduct by firms with substantial market power. Co-chaired by the FTC and the German Bundeskartellamt, the Working Group’s session explored the competition analysis of refusal to deal and margin squeeze conduct, highlighting the results of a report based on a survey of more than 40 jurisdictions.

Other important developments of the conference were based on the work of the Merger Working Group, co-chaired by the Antitrust Division and the Irish Competition Authority. During the conference, ICN members adopted two detailed Recommended Practices for Merger Analysis. The new Recommended Practices for merger analysis address:

Market Definition in Merger Review. Agencies should address the competitive effects of a merger within economically meaningful markets. The hypothetical monopolist test is an appropriate test to determine the relevant market(s) in which to analyze the competitive effects of a merger.

Failing Firm/Exiting Assets Analysis. Agencies should carefully review claims by the merging parties that a merger will not harm competition because the acquired firm and its assets would have exited the market absent the merger in any event.

In addition, the ICN conference showcased the work of the Cartel Working Group, which aims to enhance the ability of antitrust agencies to crack cartels through the discussion of effective investigative techniques and the examination of important legal and policy topics. In Istanbul, the Cartel Working Group presented the results of a survey of more than 45 jurisdictions and their views of the significant anti-cartel enforcement developments over the past decade. During the past year, the working group conducted a teleconference discussion series devoted to the trend of jurisdictions adopting criminal sanctions against individuals for hard-core cartel conduct. The Cartel Working Group presented new work addressing digital evidence gathering in cartel investigations and cartel case initiation.

The Advocacy Working Group presented guidance for agencies on conducting effective market studies and a report summarizing a series of teleseminars on agencies’ competition advocacy programs. The Agency Effectiveness Working Group presented a report on strategic planning and prioritization principles.

The network also launched an ambitious project to create a “virtual university” on competition law and practice, which will include training modules aimed at new agency staff. FTC Director of the Office of International Affairs, Randolph W. Tritell, will head the project with former ICN Steering Group Chair David Lewis, from South Africa. Tritell and Lewis aim to prepare classes on market definition and market power for the ICN’s next annual conference.

Tritell explained, “With the growth in the global competition community comes a need for training, especially for staff of young agencies. The ICN’s virtual university will seek to meet these needs by over time providing easily accessible electronic training modules that cover the spectrum of the substantive and procedural aspects of competition law and its implementation.”

The ICN was created in October 2001, when the FTC and the Justice Department joined with antitrust agencies from 13 other jurisdictions (Australia, Canada, the European Union, France, Germany, Israel, Italy, Japan, Korea, Mexico, South Africa, the United Kingdom, and Zambia) to increase understanding of competition best practices around the world. The ICN now includes 112 member agencies from 99 jurisdictions.

ICN documents are available at

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