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Introduction: Research Questions and Competition Law in a Developing Country Context

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The Interface of Competition Law, Industrial Policy and Development Concerns

Part of the book series: Munich Studies on Innovation and Competition ((MSIC,volume 8))

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Abstract

The South African Walmart case is a focal point of the interface of competition law, industrial policy and development concerns. When in 2010 Walmart made public its intention to acquire Massmart, parent company of a number of well-known South African retail chains, the government and trade unions mounted the barricades: Walmart, which had already been cited as the epitome of profit-driven business conduct ignorant to the fate of its own workforce, now embarked on taking over a number of popular South African brands. The merger did not have any negative effects on competition. This would normally suffice for a competition authority to clear it. However according to the South African Competition Act (‘Act’), there is a second hurdle. Mergers have to also pass muster with a public interest test. This second hurdle provided the opportunity for three ministers of government, five trade unions and a small enterprise forum to become part of the assessment process. One minister had meddled with the parties even before the case got under way. When the Competition Tribunal (‘Tribunal’) rejected to impose on Walmart collective bargaining commitments and a local procurement quota, government—represented through its ministers—did not shy away from taking the matter on appeal. However also the Competition Appeal Court (‘Appeal Court’) threw out the parties’ claims. It explicitly opposed misusing competition law in order to address industrial policy issues.

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Notes

  1. 1.

    See merger case Edgars Consolidated Stores (Pty) Ltd and Rapid Dawn 123 (Pty) Ltd 21/LM/Mar05, 4 July 2005 (CT) para 26.

  2. 2.

    Republic of South Africa, ‘Competition Act, 1998’, No 89 of 1998, s 12(A)(3).

  3. 3.

    See cases Walmart Stores Inc and Massmart Holdings Ltd 73/LM/Nov10, 29 June 2011 (CT) 123; The Minister of Economic Development and Others and The Competition Tribunal and Others; SACCAWU and Walmart Stores Inc and Others 110/CAC/Jul11 and 111/CAC/Jun11, 9 March 2012, First ruling (CAC). Cases taken by the Competition Tribunal are available at http://www.comptrib.co.za/cases/, cases by the Competition Appeal Court at http://www.comptrib.co.za/cases/appeal/.

  4. 4.

    Walmart Stores Inc and Massmart Holdings Ltd 73/LM/Nov10, 29 June 2011 (CT) para 1.

  5. 5.

    See H Marais, South Africa Pushed to the Limit: The Economy of Change (2011) 9–10.

  6. 6.

    International Criminal Court ‘Rome Statute of the International Criminal Court’ (1998) Art 7(1)(j).

  7. 7.

    On the connection between Apartheid and cheap labour, see A Hirsch, Season of Hope – Economic Reform under Mandela and Mbeki (2005) 12ff.

  8. 8.

    C Feinstein, An Economic History of South Africa – Conquest, discrimination and development (2005) 151.

  9. 9.

    B Fine and Z Rustomjee, The Political Economy of South Africa – From Minerals-Energy Complex to Industrialisation (1996) 117.

  10. 10.

    S Roberts, ‘The Role for Competition Policy in Economic Development: The South African Experience’ (2004) 1.

  11. 11.

    W Fikentscher in W Fikentscher (ed), Die Freiheit und ihr Paradox: Über Irrtümer unserer Zeit (1997) 1, 71.

  12. 12.

    This remains true no matter how economics-based competition law becomes. Competition law has to offer administrable rules that give clear guidance to business. See EM Fox, (2006) (3) Utah L. Rev. 725, 740.

  13. 13.

    See W Fikentscher in W Fikentscher (ed), Die Freiheit und ihr Paradox: Über Irrtümer unserer Zeit (1997) 1, 65ff.

  14. 14.

    Defending such political values as integral to antitrust against the purely economic approach of the Chicago School, see early account by R Pitofsky, (1979) 127 (4) Univ. Penn. Law Rev. 1051, 1052ff.

  15. 15.

    See J Drexl in Forschungsinstitut für Wirtschaftsverfassung und Wettbewerb (ed), Wettbewerbspolitik und Kartellrecht in der Marktwirtschaft: 50 Jahre FIW – 1960 bis 2010 (Festschrift) (2010) 175, 188–189 and 190. Referring to Ronald Dworkin’s critique of the efficiency paradigm, the author emphasises the importance of guaranteeing the protection of competition to all participants – consumers, sellers and competitors. All citizens should be enabled to define for themselves their respective role in the market and to pursue their economic interests accordingly. Such model of competition which emphasises equal treatment in the sense of market opportunities as opposed to equality in results does not contradict the freedom principle.

  16. 16.

    See G Amato, Antitrust and the Bands of Power: The Dilemma of Liberal Democracy in the History of the Market (1997) 2–3. In a similar vein O Andriychuk in D Zimmer (ed), The Goals of Competition Law (2012) 95, 102.

  17. 17.

    In a similar vein, see J Drexl in J Drexl, W Kerber and R Podszun (eds), Competition Policy and the Economic Approach (2011) 312, 314.

  18. 18.

    P Bianchi and S Labory in P Bianchi and S Labory (eds), International Handbook on Industrial Policy (2006) 3, 3.

  19. 19.

    See ML Possas and H Borges in M Cimoli, G Dosi and JE Stiglitz (eds), Industrial Policy and Development (2009) 447, 449–450.

  20. 20.

    On purported barriers in developing countries, see H-J Chang, ‘Industrial Policy: Can Africa do it?’ (2012), talk given at IEA/World Bank Roundtable on Industrial Policy in Africa, Pretoria, 3–4 July 2012, 3ff. Noting that now industrialised countries at earlier stages applied industrial policy too, which justifies application in developing countries today, see M Di Maio in M Cimoli, G Dosi and JE Stiglitz (eds), Industrial Policy and Development (2009) 107, 136.

  21. 21.

    See DJ Gerber, Global Competition – Law, Markets and Globalization (2010) 253.

  22. 22.

    M Bakhoum, (2011) 34 (3) World Compet. 495, 499–500.

  23. 23.

    A Sen, The Idea of Justice (2009) 231ff. See further MC Nussbaum, Women and Human Development (2000) 70ff.

  24. 24.

    See A Sen, Development as Freedom (1999) 116ff.

  25. 25.

    See on this topic SR Osmani in K Basu and R Kanbur (eds), Arguments for a Better World: Essays in Honor of Amartya Sen (2008) 15.

  26. 26.

    ‘The Trouble with GDP’ The Economist (30 April 2016).

  27. 27.

    See report by Commission on the Measurement of Economic Performance and Social Progress, ‘Survey of Existing Approaches to Measuring Socio-Economic Progress’ (2009).

  28. 28.

    See M Fleurbaey and D Blanchet, Beyond GDP – Measuring Welfare and Assessing Sustainability (2013); M Fleurbaey, (2009) 47 (4) J. Econ. Lit. 1029.

  29. 29.

    On the need for a broader framework with regard to industrial and competition policy, see CN Pitelis in P Bianchi and S Labory (eds), International Handbook on Industrial Policy (2006) 435, 443. For a broader view of competition law in regard of developing concerns, see EM Fox, (2007) 13 Sw. J.L. & Trade Americas 101, 105.

  30. 30.

    When the differentiation between developed and developing countries was introduced in the 1960s, the Apartheid regime had no interest in changing the status to a developing country. Also in 1993, after Apartheid, South Africa could not achieve a change in treatment. See A Hirsch, Season of Hope – Economic Reform under Mandela and Mbeki (2005) 109–110. South Africa’s accession to the BRIC club in late 2010 entailed a change of the group’s acronym – standing for the different member countries Brazil, Russia, India and China – from BRIC to BRICS. Note that whereas the four other members are readily described as major emerging economies, the case of South Africa is different. Its population and landmass is dwarfed by the remaining members, and despite still being the most successful economy in Africa, it struggles to keep up with the other members’ growth in GDP. See D Smith, ‘South Africa: More of a Briquette than a Bric?’ The Guardian (24 March 2013). Note though that there is an evolving body of research on the BRICS’ economies, including South Africa. See for instance C Tapscott and others, (2017) 2 (1) Chin. Polit. Sci. Rev. 1.

  31. 31.

    On some Southern African countries, see H Irvine and C Upfold, ‘Competition Developments in Southern Africa’, CPI Antitrust Chronicle (2012). On the BRICS states, including South Africa, see A Svetlicinii and J-J Zhang, (2017) 2 (1) Chin. Polit. Sci. Rev. 85.

  32. 32.

    MS Gal and EM Fox in MS Gal and others (eds), The Economic Characteristics of Developing Jurisdictions – Their Implications for Competition Law (2015) 296, 296.

  33. 33.

    F Kronthaler and J Stephan, (2007) 52 (2) The Antitrust Bulletin 137, 141.

  34. 34.

    See DJ Gerber, Global Competition – Law, Markets and Globalization (2010) 79.

  35. 35.

    Ibid 82.

  36. 36.

    Ibid 86.

  37. 37.

    See J Drexl in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 231, 238; MS Gal in AM Alvarez and others (eds), Competition, Competitiveness and Development: Lessons from Developing Countries (2004) 21, 23; WE Kovacic, (2001) 77 Chi-Kent L.Rev. 265, 291ff. Critical though AE Rodriguez and A Menon, The Limits of Competition Policy: The Shortcomings of Antitrust in Developing and Reforming Economies (2010) xx–xxi. For two reasons the authors deem competition law an inappropriate tool. First, there is uncertainty why in some cases liberalisation has failed; second, they ascribe market power of dominant firms only to rent-seeking by interest groups and preferential treatment by government.

  38. 38.

    See on this J Drexl in Monopolkommission (ed), Zukunftsperspektiven der Wettbewerbspolitik (2005) 49; J Drexl, (2004) 27 (3) World Compet. 419; K McMahon, ‘Developing Countries and International Competition Law and Policy’, Warwick School of Law Research Paper No 2009–11 (2009). It was notably but not alone the US which opposed an international framework; for different reasons also developing countries were highly critical. They feared that an agreement on the international level would only serve as a market access tool. See on this DJ Gerber, Global Competition – Law, Markets and Globalization (2010) 106–107.

  39. 39.

    The term traces back to John Williamson’s work on policy reform in Latin America, see J Williamson, The Progress of Policy Reform in Latin American Countries (1990). Originally comprising ten specific policy recommendations, it soon became used in a much broader, derogatory manner in order to refer to neoliberal market conceptions. Williamson himself objected to this use. On the latter, see J Williamson, (2000) 15 (2) World Bank Res. Obs. 251.

  40. 40.

    They were based on the believe that development would function best if markets were left alone and governments did not interfere more than was necessary for the creation of a basic regulatory framework. See E Fox in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 273, 276–277.

  41. 41.

    See D Rodrik, (2006) 44 (4) J. Econ. Lit. 973.

  42. 42.

    DJ Gerber, Global Competition – Law, Markets and Globalization (2010) 88.

  43. 43.

    MS Gal and EM Fox in MS Gal and others (eds), The Economic Characteristics of Developing Jurisdictions – Their Implications for Competition Law (2015) 296, 302.

  44. 44.

    For efforts to promote the Sherman Act over EU competition law in Eastern European countries, see SW Waller, (1994) 42 U. Kan. L. Rev. 557, 569ff. Because both, enforcement of the law and the exportation of products, could reduce costs, developing countries were said to profit as well. For the case of Israel, see MS Gal, (2007) 9 (3) EJLR 467, 476ff.

  45. 45.

    SW Waller, (1994) 42 U. Kan. L. Rev. 557, 571ff. European Commission, ‘Economic Partnership Agreement between the CARIFORUM States and the European Community and its Member States’ (2008) OJ [2009] L 289/I/3.

  46. 46.

    See Art. 12.2 of Government of the United States of America and Government of the Republic of Singapore, ‘United States – Singapore Free Trade Agreement’ (2004). In 2006 Singapore started to adapt a competition law.

  47. 47.

    For a discussion of the benefits of such law, see J Drexl, (2004) 27 (3) World Compet. 419, 425.

  48. 48.

    See Art. 127 of European Commission, ‘Economic Partnership Agreement between the CARIFORUM States and the European Community and its Member States’ (2008) OJ [2009] L 289/I/3; See further J Drexl in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 231, 231–232; TA O’Keefe, Latin American and Caribbean Trade Agreements: Keys to a Prosperous Community of the Americas (2009) 382ff; P Sauvé and N Ward, ‘The EC-Cariforum Economic Partnership Agreement: Assessing the Outcome on Services and Investment’, European Centre for International Political Economy (ECIPE) Paper (2009) 49ff.

  49. 49.

    See Art. 57 of European Commission, ‘Interim Agreement with a view to an Economic Partnership Agreement between the European Community and its Member States and the Central Africa Party’ (2009) OJ [2009] L 57/1.

  50. 50.

    H Shahein in R Whish and C Townley (eds), New Competition Jurisdictions: Shaping Policies and Building Institutions (2012) 35, 43–44.

  51. 51.

    For a discussion of this argument, see SJ Evenett, ‘Competition Law and the Investment Climate in Developing Countries’, Contribution to the World Development Report 2005 on Investment Climate, Growth and Poverty (2003) 7ff. See also MS Gal, (2007) 9 (3) EJLR 467, 479.

  52. 52.

    DI Waked, ‘Antitrust Enforcement in Developing Countries: Reasons for Enforcement & Non-Enforcement Using Resource-Based Evidence’ (2010), talk given at Conference on Empirical Legal Studies, New Haven, Yale Law School, 5–6 November 2010, 12; F Kronthaler and J Stephan, (2007) 52 (2) The Antitrust Bulletin 137, 143ff, 158ff; F Kronthaler, (2010) 51 International Research Journal of Finance and Economics 71, 79.

  53. 53.

    CUTS, ‘Competition Policy and Economic Growth – Is There a Causal Factor?’ (2008) 2.

  54. 54.

    DJ Gerber, Global Competition – Law, Markets and Globalization (2010) 82.

  55. 55.

    For a summary of the studies referred to, see AM Mateus, (2010) 33 (2) World Compet. 275, 278–279.

  56. 56.

    Regarding Africa, Gerber points out that besides competition law’s ‘generic’ benefits, it could help to diversify economies, which he deems an issue of major relevance. He contends that ‘[t]he colonially-imposed and state-controlled economic model has proven difficult to change, but without such structural changes the countries of Africa will be left exposed to the vagaries of world markets that have periodically devastated their economies.’ DJ Gerber, Global Competition – Law, Markets and Globalization (2010) 258.

  57. 57.

    See CUTS, ‘Competition Policy and Economic Growth – Is There a Causal Factor?’ (2008) 6; L du Plessis, J Lurie and A van Buuren, ‘Competition Law in the Developing World: A Fish out of Water?’ (2011), talk given at Fifth Annual Conference on Competition Law, Economics & Policy, Johannesburg, University of Johannesburg, 4–5 October 2011, 11ff; SJ Evenett in DH Brooks and SJ Evenett (eds), Competition Policy and Development in Asia (2005) 1, 5; EM Fox, (2007) 13 Sw. J.L. & Trade Americas 101, 221; OECD, (2004) 6 (1&2) OECD Journal of Competition Law and Policy 40, 41.

  58. 58.

    OECD, (2004) 6 (1&2) OECD Journal of Competition Law and Policy 40, 44.

  59. 59.

    For an overview of the studies, see AM Alvarez, SJ Evenett and L Wilse-Samson in AM Alvarez and L Wilse-Samson (eds), Implementing Competition-Related Provisions in Regional Trade Agreements: Is it Possible to Obtain Development Gains? (2007) 59, 62ff. See further N Petersen, (2013) 9 (3) JCLE 593, 617. The author confirms the link between competition policy and law and long-term economic growth but does not find a positive effect on democracy.

  60. 60.

    J Drexl in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 231, 250.

  61. 61.

    Ibid 249–250.

  62. 62.

    See overview in F Kronthaler, Implementation of Competition Law in Developing and Transition Countries (2007) 32ff.

  63. 63.

    Ibid 50.

  64. 64.

    See A Bhattacharjea in DD Sokol, TK Cheng and I Lianos (eds), Competition Law and Development (2013) 52, 65. The author points out that in no developed country competition law started out with as an efficiency-based focus as many of the laws have today. On in part substantially cultural differences what regards the concept of competition, see W Pape, (1999) 5 (4) ELJ 438, 443ff.

  65. 65.

    See WE Kovacic, (2001) 77 Chi-Kent L.Rev. 265, 273; WE Kovacic, (2007) 3 (2) ECJ 319, 321–322. Rodriguez and Menon point out that developing economies had not gone through ideological debates concerning the pros and cons of a competitive market system and the role of the state therein. That these countries might prefer regulation over litigation as the means of choice was plainly ignored. AE Rodriguez and A Menon, The Limits of Competition Policy: The Shortcomings of Antitrust in Developing and Reforming Economies (2010) 23 and 75. For economic data, see SJ Evenett in MS Gal and others (eds), The Economic Characteristics of Developing Jurisdictions – Their Implications for Competition Law (2015) 15. The author concludes that the prevailing economic conditions are too diverse to presume that one could simply transplant competition law from high income countries. Yet it was likewise not justified to assume that developed countries’ recipes were useless to developing countries. Fox speaks of a ‘comparative advantage’ of developing countries in the sense of creating competition laws that match local necessities. See E Fox, ‘Competition Policy: The Comparative Advantage of Developing Countries’, NYU Law and Economics Research Paper No 17-04 (2017).

  66. 66.

    Compare CL Clement and others, ‘Competition Policies for Growth: Legal and Regulatory Framework for SSA Countries’, Center for Institutional Reform and the Informal Sector (IRIS), University of Maryland (2001) 1, 4.

  67. 67.

    Early on it had already been contended that competition law was most likely to succeed if drafted in accordance with local requirements and implemented in a way that would build on existing legal commands and institutions. Reliance on indigenous experts was of primary importance. See WE Kovacic, (1995) 44 DePaul L. Rev. 1197, 1215–1216.

  68. 68.

    CL Clement and others, ‘Competition Policies for Growth: Legal and Regulatory Framework for SSA Countries’, Center for Institutional Reform and the Informal Sector (IRIS), University of Maryland (2001) 1, 57–58.

  69. 69.

    MW Nicholson, DD Sokol and KW Stiegert in PS Mehta and SJ Evenett (eds), Politics Triumphs Economics: Political Economy and the Implementation of Competition Law and Economic Regulation in Developing Countries (2009) 211, 215.

  70. 70.

    See AM Mateus, (2010) 33 (2) World Compet. 275, 283ff.

  71. 71.

    See for instance MS Gal and EM Fox in MS Gal and others (eds), The Economic Characteristics of Developing Jurisdictions – Their Implications for Competition Law (2015) 296.

  72. 72.

    E Fox in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 273, 281ff.

  73. 73.

    Compare WE Kovacic, (2001) 77 Chi-Kent L.Rev. 265, 298ff.

  74. 74.

    E Fox in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 273, 283.

  75. 75.

    H Shahein in R Whish and C Townley (eds), New Competition Jurisdictions: Shaping Policies and Building Institutions (2012) 35, 36.

  76. 76.

    Ibid 27ff.

  77. 77.

    Ibid 39ff. On the variety of cultural attitudes towards competition, see T Indig and MS Gal in MS Gal and others (eds), The Economic Characteristics of Developing Jurisdictions – Their Implications for Competition Law (2015) 51, 66ff.

  78. 78.

    See M Bakhoum, (2011) 34 (3) World Compet. 495, 498, 508; SJ Evenett in DH Brooks and SJ Evenett (eds), Competition Policy and Development in Asia (2005) 1, 24; EM Fox, (2007) 13 Sw. J.L. & Trade Americas 101, 214 and 219.

  79. 79.

    EM Fox, (2007) 13 Sw. J.L. & Trade Americas 101, 215.

  80. 80.

    See on this topic M Bakhoum in MS Gal and others (eds), The Economic Characteristics of Developing Jurisdictions – Their Implications for Competition Law (2015) 177.

  81. 81.

    EM Fox, (2007) 13 Sw. J.L. & Trade Americas 101, 223–224.

  82. 82.

    M Bakhoum, (2011) 34 (3) World Compet. 495.

  83. 83.

    Ibid 496.

  84. 84.

    Ibid 499ff and 513ff.

  85. 85.

    Ibid 519. Accordingly, with regard to the ongoing convergence movement, promoted under the aegis of the ICN, caution was warranted, for this movement contained a consolidation based on Western competition law principles, ibid at 501ff. See further on this DJ Gerber, Global Competition – Law, Markets and Globalization (2010) 111–116.

  86. 86.

    See, for instance, challenges faced by Zambia, T Kaira in PS Mehta and SJ Evenett (eds), Politics Triumphs Economics: Political Economy and the Implementation of Competition Law and Economic Regulation in Developing Countries (2009) 403, 416ff. See also L du Plessis, J Lurie and A van Buuren, ‘Competition Law in the Developing World: A Fish out of Water?’ (2011), talk given at Fifth Annual Conference on Competition Law, Economics & Policy, Johannesburg, University of Johannesburg, 4–5 October 2011, 4–5. See further M Burke and others, ‘Cross-cutting Competition Issues in Regional Industrial Development’, African Industrial Development and Integration Research Programme (AIDIRP) (2017) 28–38.

  87. 87.

    See V Zoghbi in PS Mehta and SJ Evenett (eds), Politics Triumphs Economics: Political Economy and the Implementation of Competition Law and Economic Regulation in Developing Countries (2009) 89, 90 and 115–116.

  88. 88.

    See M Bakhoum, ‘Interfacing the “Local” With the “Global”: A Developing Country Perspective on “Global Competition”’, Max Planck Institute for Intellectual Property and Competition Law Research Paper No 13-02 (2011) 13–14.

  89. 89.

    MS Gal in AM Alvarez and others (eds), Competition, Competitiveness and Development: Lessons from Developing Countries (2004) 21, 27.

  90. 90.

    Ibid 28ff. Similarly, see WE Kovacic, (1995) 44 DePaul L. Rev. 1197, 1221.

  91. 91.

    M Chowdhury in R Whish and C Townley (eds), New Competition Jurisdictions: Shaping Policies and Building Institutions (2012) 67, 80. The author argues that success of competition law not only depends on the capacities of a new competition agency but likewise on demand for the services it carries out.

  92. 92.

    M Bakhoum, (2011) 34 (3) World Compet. 495, 502.

  93. 93.

    PS Mehta and SJ Evenett in PS Mehta and SJ Evenett (eds), Politics Triumphs Economics: Political Economy and the Implementation of Competition Law and Economic Regulation in Developing Countries (2009) 23, 24 and 29–30.

  94. 94.

    Ibid 26. See also MS Gal in AM Alvarez and others (eds), Competition, Competitiveness and Development: Lessons from Developing Countries (2004) 21, 30ff; H Ergas, (2009) 5 (2) ECJ 347, 354.

  95. 95.

    MS Gal in AM Alvarez and others (eds), Competition, Competitiveness and Development: Lessons from Developing Countries (2004) 21, 32.

  96. 96.

    What they fail to achieve through the market system, private actors typically attempt to achieve in the political arena. PS Mehta and SJ Evenett in PS Mehta and SJ Evenett (eds), Politics Triumphs Economics: Political Economy and the Implementation of Competition Law and Economic Regulation in Developing Countries (2009) 23, 29. Note though that rent-seeking is neither limited to developing countries nor to the introduction of new laws. Yet, in developing economies there are long-standing relationships between different economic actors. These relationships produce business groups with closely aligned interests. This accumulation of private interests is met by powerful government officials, entrusted with regulating the economy. It is this duality between business and government which can create the basis for lobbying and rent-seeking and is said to seriously undermine the success of competition law. See AE Rodriguez and A Menon, The Limits of Competition Policy: The Shortcomings of Antitrust in Developing and Reforming Economies (2010) 117ff and 135.

  97. 97.

    See V Zoghbi in PS Mehta and SJ Evenett (eds), Politics Triumphs Economics: Political Economy and the Implementation of Competition Law and Economic Regulation in Developing Countries (2009) 89, 108ff.

  98. 98.

    Compare list of countries in Transparency International, ‘Corruption Perceptions Index 2014’ (2014). On Africa more generally, see ME Ochonu, (2011) 4 (3) The Law and Development Review 26.

  99. 99.

    H Ergas, (2009) 5 (2) ECJ 347, 366.

  100. 100.

    Ibid 364. However compare WE Kovacic, (2001) 77 Chi-Kent L.Rev. 265, 296–297. The author promotes competition law as a means to combat corruption. The inclusion of provisions that prevent government officials from producing artificial entry requirements could curb abuse of administrative power. See further F Kronthaler, Implementation of Competition Law in Developing and Transition Countries (2007) 45–46.

  101. 101.

    MS Gal and EM Fox in MS Gal and others (eds), The Economic Characteristics of Developing Jurisdictions – Their Implications for Competition Law (2015) 296, 311.

  102. 102.

    MS Gal in AM Alvarez and others (eds), Competition, Competitiveness and Development: Lessons from Developing Countries (2004) 21, 35.

  103. 103.

    See International Competition Network, ‘Competition and the Judiciary: A Report on a Survey on the Relationship Between Competition Authorities and the Judiciary’ (2006) 1, 15–16; International Competition Network, ‘Competition and the Judiciary: 2nd Phase – Case Studies’ (2007) 1, 19.

  104. 104.

    See M Chowdhury in R Whish and C Townley (eds), New Competition Jurisdictions: Shaping Policies and Building Institutions (2012) 67, 77–78; MS Gal in AM Alvarez and others (eds), Competition, Competitiveness and Development: Lessons from Developing Countries (2004) 21, 41–42.

  105. 105.

    V Zoghbi in PS Mehta and SJ Evenett (eds), Politics Triumphs Economics: Political Economy and the Implementation of Competition Law and Economic Regulation in Developing Countries (2009) 89, 101.

  106. 106.

    It is important to note though that alternative funding through, for instance, the fines imposed may set wrong incentives for enforcement.

  107. 107.

    Intelligent choice of the conduct to be investigated is important in order to eliminate the most harmful contraventions of competition law and garner support amongst the public. Compare V Zoghbi in PS Mehta and SJ Evenett (eds), Politics Triumphs Economics: Political Economy and the Implementation of Competition Law and Economic Regulation in Developing Countries (2009) 89, 93ff. and 98.

  108. 108.

    See DI Waked, ‘Antitrust Enforcement in Developing Countries: Reasons for Enforcement & Non-Enforcement Using Resource-Based Evidence’ (2010), talk given at Conference on Empirical Legal Studies, New Haven, Yale Law School, 5–6 November 2010, 10, 15; DI Waked, ‘Do Developing Countries Enforce Their Antitrust Laws? A Statistical Study of Public Antitrust Enforcement in Developing Countries’ (2011) 88.

  109. 109.

    Regarding the EU and US context, compare EM Fox, (2010) 41 Loy. U. Chi. L.J. 473.

  110. 110.

    EM Fox, (2007) 13 Sw. J.L. & Trade Americas 101, 226.

  111. 111.

    See L du Plessis, J Lurie and A van Buuren, ‘Competition Law in the Developing World: A Fish out of Water?’ (2011), talk given at Fifth Annual Conference on Competition Law, Economics & Policy, Johannesburg, University of Johannesburg, 4–5 October 2011, 15.

  112. 112.

    Ibid 8–10.

  113. 113.

    Markets in large economies function differently from those in smaller countries. The latter are normally characterised by a high degree of concentration and considerable entry barriers. See MS Gal, Competition Policy for Small Market Economies (2003) 251ff.

  114. 114.

    D Lewis in V Dhall (ed), Competition Law Today – Concepts, Issues, and the Law in Practice (2007) 340, 355.

  115. 115.

    D Lewis, Thieves at the Dinner Table: Enforcing the Competition Act (2012) 76–77.

  116. 116.

    EM Fox, (2007) 13 Sw. J.L. & Trade Americas 101, 230.

  117. 117.

    WE Kovacic, (1995) 44 DePaul L. Rev. 1197, 1217.

  118. 118.

    Compare ibid 1218.

  119. 119.

    Compare H Ergas, (2009) 5 (2) ECJ 347, 375. The author more rigorously suggests limiting the prohibition of price-fixing to public goods or otherwise setting high thresholds. Vertical agreements and abuse of dominance should not be condemned unless conducted by statutory monopolies. And mergers should only be blocked if they result in monopoly or quasi-monopoly situations.

  120. 120.

    EM Fox, (2007) 13 Sw. J.L. & Trade Americas 101, 231.

  121. 121.

    Ibid 121.

  122. 122.

    See AM Mateus, ‘Competition and Development: What Competition Law Regime?’ (2010) 15ff; compare also AM Mateus, (2010) 33 (2) World Compet. 275, 288ff.

  123. 123.

    AM Mateus, ‘Competition and Development: What Competition Law Regime?’ (2010) 21.

  124. 124.

    For this middle category the threshold of GDP per capita was determined to be between 3,500 and 13,500 USD. Additionally, the country had to be above the lower 40 per cent of a cumulative value of the different benchmarks. Ibid 4 and 24.

  125. 125.

    In addition to a GDP per capita of at least 13,500 USD, these countries should belong to the upper 20 per cent of the cumulative benchmark value. Ibid.

  126. 126.

    Ibid 22.

  127. 127.

    On regional integration as a means to increase Africa’s audibility in enforcement see M Bakhoum, ‘Interfacing the “Local” With the “Global”: A Developing Country Perspective on “Global Competition”’, Max Planck Institute for Intellectual Property and Competition Law Research Paper No 13-02 (2011) 19–20.

  128. 128.

    See MS Gal, (2010) 60 (2) U.T.L.J. 239, 243ff.

  129. 129.

    J Drexl in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 231, 239.

  130. 130.

    Ibid 244.

  131. 131.

    For an overview see MS Gal and IF Wassmer in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 291, 304ff. On the intricacies of enforcing the recently adopted regional agreement for Eastern and Southern Africa, see D Rudman and R Wilson, ‘COMESA Competition Law: A New Regional Merger Regime for Eastern and Southern Africa’, Journal of European Competition Law & Practice (2013).

  132. 132.

    On the overambitious concentration of competence regarding Western African states, see M Bakhoum, (2006) 29 (4) World Compet. 653. On the status of cross-border enforcement in Africa and, in particular, enforcement activities of COMESA and the EAC, see VK Kigwiru, ‘Cross-Border Competition Enforcement in Africa: Developments and Challenges’ (2017), talk given at Eleventh Annual Conference on Competition Law, Economics & Policy, Johannesburg, University of Johannesburg, 30 August–1 September 2017. On the cooperation of SADC member states in enforcing competition law, see M Ngobese and A Kühn, ‘Regional Competition Enforcement: Co-operation Between SADC Competition Authorities in the Investigation of Cross-Border Cartels’ (2017), talk given at Eleventh Annual Conference on Competition Law, Economics & Policy, Johannesburg, University of Johannesburg, 30 August–1 September 2017. See also MS Gal and IF Wassmer in J Drexl and others (eds), Competition Policy and Regional Integration in Developing Countries (2012) 291, 318.

  133. 133.

    Compare on this M Chowdhury in R Whish and C Townley (eds), New Competition Jurisdictions: Shaping Policies and Building Institutions (2012) 67, 74. The author holds that because competition law has firmly established itself as part of economic reform, the debate has become somewhat academic.

  134. 134.

    Reportedly, by 2007 of the 151 developing countries, according to the World Bank classification, 77 had adopted antitrust law and set up an enforcement agency. DI Waked, ‘Do Developing Countries Enforce Their Antitrust Laws? A Statistical Study of Public Antitrust Enforcement in Developing Countries’ (2011) 1.

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Strunz, B. (2018). Introduction: Research Questions and Competition Law in a Developing Country Context. In: The Interface of Competition Law, Industrial Policy and Development Concerns. Munich Studies on Innovation and Competition, vol 8. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-662-57627-4_1

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