“From Collusion to Competition” – Twelfth Issue

Sep 27, 2013

CPI Cartel Column edited by Rosa Abrantes-Metz (Global Economics Group/NYU Stern School of Business)

Welcome to the September issue of our Cartel Column. Today we have a very special issue with two articles dedicated to the excellent work the World Bank’s Competition Policy Team has been undertaking in the area of cartels.

The first article is titled “Combating Cartels in Developing Countries: Implementation Challenges on the Ground,” and it is authored by Martha Martinez Licetti, Global Lead for the Competition Policy Team. It focuses on the significant challenges that anti-cartel enforcement faces in countries where government policies still facilitate the creation and sustainability of cartel behavior among firms. This article explores such challenges identified as part of the analytical work and technical assistance provided by the World Bank Group in the competition policy field. It also suggests a few areas to tackle in order to increase the effectiveness of anti-cartel enforcement implementation in less developed economies.

The second article by Graciela Miralles Murciego, also a member of the Competition Policy Team, is titled “Cartel Exemptions in Developing Countries: Recent Work from the World Bank Group.” The article discusses how cartel exemptions (either general or specific exemptions) can be pervasive across antitrust laws and regulations, but stresses that not all exemptions are created the same way, have similar effects, nor should be analyzed under a single logic. Different rationales distinguish exemptions granted to small and medium enterprises (SMEs) and collective bargaining agreements from those protecting certain industries or sectors based on domestic policy justifications. Correctly defining and implementing cartel exemption provisions constitutes a key element in the design and consolidation of effective competition policy frameworks in developing countries. This has been a main area of focus for this team at the World Bank, through the adoption of a pragmatic approach to help ensure that these provisions are well functioning, while recognizing that cartel exemptions may exist and trying to minimize any resulting anticompetitive impact.

These are both great articles.

Please feel free to send me or the authors any comments or suggestions you may have, and happy reading!

Rosa M. Abrantes-Metz