{"id":3216,"date":"2019-12-11T13:51:22","date_gmt":"2019-12-11T12:51:22","guid":{"rendered":"https:\/\/www.d-kart.de\/?p=3216"},"modified":"2019-12-15T09:57:06","modified_gmt":"2019-12-15T08:57:06","slug":"conference-debriefing-17-antitrust-in-times-of-upheaval-cra-2019","status":"publish","type":"post","link":"https:\/\/www.d-kart.de\/en\/blog\/2019\/12\/11\/conference-debriefing-17-antitrust-in-times-of-upheaval-cra-2019\/","title":{"rendered":"Conference Debriefing (17): Antitrust in Times of Upheaval \u2013 CRA 2019"},"content":{"rendered":"\n

The conference circuit picked up speed again now that the end of this remarkable year is near. We were not able to attend everything out there but obviously if catering promises to be good Rupprecht Podszun is never too far – and so here is his Conference Debriefing from Woodstock!<\/em><\/p>\n\n\n\n

Name of Conference<\/strong>: Antitrust in Times of Upheaval<\/p>\n\n\n\n

Place & Time<\/strong>: Steigenberger Wiltcher\u2019s Brussels,\n10 December 2019<\/p>\n\n\n\n

Host<\/strong>: CRA, the economic consultancy, but\nreally it is The Cristina Caffarra Show<\/p>\n\n\n\n

Audience<\/strong>: The list of participants has something like 1000 people on it (I stopped counting at 14 and had only reached DG COMP\u2019s Deputy Chief Economist Albaek, Svend<\/em> at that point\u2026). Isabelle de Silva, the French top enforcer, said that this was like the Google of conferences \u2013 so big. (CRA replied by Twitter that there are less complaints though.)<\/p>\n\n\n\n


Before we start with the conference: We have a new Director General!<\/strong><\/h3>\n\n\n\n
\"\"
Olivier Guersent. Photo by Etienne Ansotte (EU Commission)<\/figcaption><\/figure><\/div>\n\n\n\n

Yepp, that is the news of this morning: Olivier Guersent, currently Director General in DG FISMA (that has something to do with finances) returns to DG COMP as the successor of Johannes Laitenberger who became a judge at the Court. And some will still remember him – he joined the Merger Task Force as a national expert from his native France in 1992, and he never left Brussels again. He worked with Commissioners van Miert, Kroes and Barnier (the latter one in DG Market), so he really knows his way around in competition law. In 2015, he became Director General in charge of financial stability and capital markets and he had also been tipped as Ursula von der Leyens Secretary-General. This seems to be his latest speech<\/a> (on capital markets). Bienvenue \u00e0 nouveau!<\/p>\n\n\n\n


Now, which Brussels conference are you actually reporting on? The one with Philip Marsden?<\/strong><\/h3>\n\n\n\n

He is in all <\/em>conferences, but you are probably referring to the one organised by Chillin\u2019 Competition on Monday. That one seems to have had at least two really remarkable moments: Firstly, Philip Marsden, the top-notch entertainer on the stages of antitrust, delivered a rap (literally, a rap!) that you may watch here.<\/a> (*New link to a better video added!*)<\/p>\n\n\n\n

Secondly,\nMargrethe Vestager announced she would review the 1997 Market Definition Notice<\/a>. <\/p>\n\n\n\n


That\u2019s about time! <\/strong><\/h3>\n\n\n\n

True. I found it pretty interesting, how this was received by Brussels media. When I hear that the Commission looks at market definition, I expect that the issue of growing convergence is addressed so that we move out of the trap of neatly defined narrow markets. (I am in favour of a very open, evolutionary concept of market definition, see, e.g., in this book<\/a> that I like very much…#ad) <\/p>\n\n\n\n

Brussels media however interpreted Vestager\u2019s announcement<\/a> as \u201cmusic to the ears of those who have asked the EU to take a more global view of competition cases\u201d (Politico<\/a>), i.e. Ministers Peter Altmaier and Bruno Le Maire who were unhappy with market definition in Siemens\/Alstom<\/em>. We should probably be on guard that opposition to mergers with a chillin\u2019<\/em> effect is not made more difficult through the backdoor of a revised market definition notice. Massimo Motta and Hans Zenger \u2013 at our conference \u2013 provided some comfort when saying that the new market definition notice will not bring big changes anyway.<\/p>\n\n\n\n


Vestager, in her speech, said that digitisation caused an \u201cearthquake in our markets\u201d. That is a remarkable way to put it, isn’t it?<\/strong><\/h3>\n\n\n\n

Well, this brings us to the conference organised by CRA with this massive crowd \u2013 it had the catchy \u201cupheaval\u201d in its title. This goes back to a remark by Radicalxchange<\/em> activist Glen Weyl who likes to argue with enslaved peasants of former days when discussing the grip of monopoly power of the digital lords. <\/p>\n\n\n\n

CRA Conference 2019 Programme<\/a>Herunterladen<\/a><\/div>\n\n\n\n

DG COMP economist Hans Zenger labelled this conference \u201cthe Woodstock of competition law\u201d. Yet, style-wise, I think that only economists Florian Ederer (co-author of the famous \u201ckiller acquisitions\u201d paper<\/a>) and maybe Berlin\u2019s Tomaso Duso would have qualified for the Crosby Stills Nash & Young revival band<\/a>. Zenger had a point though: Woodstock, this I learn from Wikipedia, was the tipping point when hippie music was finally established as mainstream. And if you saw that impressive line-up of top enforcers in that Steigenberger Ballroom (not exactly a muddy meadow) \u2013 Coscelli, de Silva, Mundt, Steenbergen, Madero, Snoep to name but a few \u2013 you could really think that this conference must be mainstream while many of the ideas floated sounded more “hippie”.<\/p>\n\n\n\n

\"\"
A packed ballroom with 900 or so people. And all of them love competition law (as long as enforced to others)! <\/figcaption><\/figure>\n\n\n\n


I don\u2019t want you to get taken away by that Woodstock analogy, but now that you are on it\u2026 what was the tune people sang along to?<\/strong><\/h3>\n\n\n\n

If I had to pick from the Woodstock set list, it\u2019s probably \u201cYou can make it if you try\u201d<\/a> by Sly & the Family Stone: there was a lot of encouragement for tougher enforcement, partly due to a list of invitees who stand for exactly this. Enforcers can make it if they try \u2013 design more effective rules, step up enforcement, make Google, Amazon, Facebook shiver. I guess the GAFA-representatives in the room (yes, they were there) probably took their hands later in a self-help group to sing \u201cWe shall overcome\u201d<\/a> together.<\/p>\n\n\n\n


So there is consensus nowadays that GAFA is the bad guys and more action needs to be taken?<\/strong><\/h3>\n\n\n\n

If you place Glen Weyl and Barry Lynn (from the Open Markets Institute) in a panel do not expect cosy times for monopolists. Stratechery\u2019s Ben Thompson called for a closer look at the differing business models of these operators of ecosystems, yet this conference took the broader view and skipped some of the details. <\/p>\n\n\n\n

\"\"
The “out of the box”-panel with Barry Lynn, Glen Weyl, Mariana Mazzucato, Luigi Zingales and Cristina Caffarra.<\/figcaption><\/figure>\n\n\n\n

You\ncertainly do not have to agree to all that Lynn and others say, but they have a\npoint in placing antitrust enforcement into the larger picture of the digital\ntransformation. Democracy is at risk due to fake news and societal rifts?\nCompanies are able to monitor you 24\/7 and know you better even in your most\nintimate secrets than your partner? They are able to control the information\nyou get? You have a mobile phone, a wearable and a smart home assistant? If you\nnodded, the next question is: what is at the root of it? Answer: economic\npower. Question: What is the field of law that regulates economic power?\nAnswer: Antitrust law. Quod erat\ndemonstrandum.<\/em><\/p>\n\n\n\n

Even if you see these people as a bit off-track from your daily Brussels case routine, they have valid points and they have a voice. Plus: They get a lot of support from really sought-after economists. There was one stellar panel (if all male) of ace econ scholars: Massimo Motta, Hans Zenger, Thomas Wollmann, Florian Ederer, Luis Cabral, Tomaso Duso, Luigi Zingales\u2026 sitting in one row. <\/p>\n\n\n\n

\"\"
Dutch chief enforcer Martijn Snoep with that economist dream team (Wollmann, Ederer, Cabral, Duso, Zingales) – not in the picture: Hans Zenger and Massimo Motta.<\/figcaption><\/figure>\n\n\n\n

And all of them, with varying degrees of enthusiasm, supported tougher enforcement informed by empirical research, behavioural studies or innovation economics. They no longer worry about over-enforcement, but fear that under-enforcement brings the economy down. Just as an example, Thomas Wollmann from Chicago Booth says that we see \u201cstealth consolidation\u201d<\/a> in many markets where merger control is weak \u2013 and even small M&A activity may have a large impact if the market is already highly concentrated. Luis Cabral from NYU, one of the more cautious people, shattered some myths regarding innovation<\/a>, speaking of the \u201cin the shadow of Google\u201d-effect for innovators in the Silicon Valley. Obviously, some of their findings are heavily influenced by the comparably weak antitrust enforcement in the United States.<\/p>\n\n\n\n


I wonder how this goes down with the U.S. guys\u2026<\/strong><\/h3>\n\n\n\n
\"\"
Joshua Gans, FTC Commissioner Rohit Chopra and Ben Thompson.<\/figcaption><\/figure><\/div>\n\n\n\n

I can tell you, because they were there! Rohit Chopra, a Commissioner of the U.S. Federal Trade Commission, turned out to be a really tough pro-enforcement advocate, but then, he often writes the dissenting opinion in the FTC. Aaron Hoag, on the other hand, a representative of the U.S. Department of Justice, barely said a word. Let’s hope he had at least a good tourist programme in Brussels. Max Miller, Assistant Attorney General of Iowa\u2026<\/p>\n\n\n\n


Hang on \u2013 I am really into international stuff, but the Assistant Attorney General of Iowa\u2026 I mean we are taking it that far, now?<\/strong><\/h3>\n\n\n\n

You are a\ngawk. For one, Iowa had the first antitrust law in the United States: the \u201cAct\nfor the punishment of Pools, Trusts, Conspiracies, and as to Evidence in such\ncases\u201d, dating back to 1888, while the Sherman Act was only passed in 1890. (Read the Iowa Act here<\/a>, it\u2019s really good!) <\/p>\n\n\n\n

Two, with the DoJ rather tongue-tied, the federal states took over. Max Miller, who is a Skadden Arps-trained antitrust lawyer, is one of the people going after big tech. 48-plus-2 state attorney generals in the United States joined forces to tame the techies. This system was explained by General Peterson<\/em>. That sounded so good: Doug Peterson is the Attorney General of Nebraska. We learned you properly address such people as \u201cGeneral\u201d.  When the General raised his Mid-West voice and when he explained very calmly and clearly how the multi-state investigation<\/a> into big tech develops into the \u201cperfect storm\u201d (his words), I could not help but to think of Clint Eastwood<\/a>. <\/p>\n\n\n\n


Probably a way to go\u2026<\/strong><\/h3>\n\n\n\n

Absolutely, if you follow Thomas Philippon from NYU. His book \u201cThe Great Reversal\u201d is the one to read these days (after having finished Daniel Zimmer\u2019s \u201cM\u00f6bius\u201d<\/a> of course). Jason Furman (yes, the Harvard professor from the Furman Report!) introduced Philippon\u2019s book as \u201cexcellent\u201d, and CMA Chief Executive Andrea Coscelli confirmed he had just read it. It seems to be a must-read. <\/p>\n\n\n\n

\"\"
A pro-enforcement lobby, working on the great reversal: Tommasso Valletti, Andrea Coscelli, Jason Furman, Thomas Philippon and John Van Reenen.<\/figcaption><\/figure>\n\n\n\n

Philippon states that U.S. markets are highly concentrated \u2013 the former free market eldorado has been reversed. He attributes a lot of the current problems to aggressive anti-antitrust lobbying by some firms. His intervention put capture of regulators into the spotlight \u2013 one of the many institutional issues standing in the way of the \u201cupheaval\u201d in antitrust.<\/p>\n\n\n\n


But it is the state to fix things?<\/strong><\/h3>\n\n\n\n

Some say so. Mariana Mazzucato started her talk with quoting Karl Marx, and according to her, Schumpeter\u2019s writing was only a variation of Marx (or so). Well, everyone chooses his or her own points of reference\u2026 Her bottom line is that all great innovation stems from state-funded projects \u2013 what would Google be without Al Gore inventing the Internet<\/s> public funds sponsoring the technology we now know as the Internet? Many apps or automated driving depend on GPS \u2013 a state-funded innovation. So, for Mazzucato there is a legitimacy to tax and control those that use these technologies, and there are good grounds to devise intelligent state intervention in order to foster such ground-breaking innovation. MIT\u2019s John Van Reenen goes into that direction, too.<\/p>\n\n\n\n

Someone (was it Tom Valletti, who according to his own words is still detoxifying <\/em>from the Brussels bubble after his stint as a Chief Economist?) said he would go for industrial policy if John Van Reenen oversaw it. Others were hesitant. Jason Furman favoured trade over aid. So, I think the majority still believes in the power of free. Or, as Furman put it: EU and US have never been good at industrial policy, so why should we try it now?<\/p>\n\n\n\n

\"\"
Pretty smart panel: Philipp Marsden, Isabelle de Silva, Dina Srinivasan, Alessandro Acquisti, Yves-Alexandre de Montjoye, Francesca Bria.<\/figcaption><\/figure>\n\n\n\n

Speaking of the role of the state, I liked a vision that was put forward by Francesca Bria who is new to the antitrust circuit (but I am sure she is a hot ticket now): Bria was the Chief Digital Officer of Barcelona, one of the most touristy<\/s> smartest cities in Europe. She sketched the Barcelona public digitisation as a project where the state on its very home turf may show how it goes: Where the state acts as a service provider in town with huge amounts of data, sensors, public services etc. it should create an environment respecting privacy and<\/em> competition. Bria put the focus on data sovereignty for citizens. This translates into the economic value of private data handed to these citizens. If you combine that with open interfaces, portability, fair chances for operators, a smart city may be a hub that serves as a model for integrating competition principles and privacy in a smart environment. If Barcelona can do it, Facebook could do it, too. Interesting, at least, to remind the public bodies that are now venturing into the field of data that they have to respect competition and privacy, too.<\/p>\n\n\n\n


So, we are at the Facebook<\/em> case finally! <\/strong><\/h3>\n\n\n\n

Necessarily so. Ever since Margrethe Vestager conceded that the remedies<\/a> in Google Shopping<\/em> have not proved helpful so far, Facebook<\/em> is the case winning the award for Most Targeted Remedy.<\/p>\n\n\n\n

Bundeskartellamt\u2019s Andreas Mundt was on a panel, and he made a self-confident impression even though the remedy has not yet been put into practice after that famous ruling<\/a> by the D\u00fcsseldorf court in interim proceedings. I held my breath when President Mundt said: \u201cWe will change the business models.\u201d Challenged on this rather radical sentence by awesome host Cristina Caffarra Mundt, smiling subtly at the provocative effect of his words, clarified: \u201cIf a business model only works with anti-competitive features we will change that since we will prohibit those anti-competitive features.\u201d Sigh.<\/p>\n\n\n\n

\"\"
Cristina Caffarra, Andreas Mundt, General Peterson, Aaron Hoag from DoJ and Australian ACCC-Commissioner Sarah Court.<\/figcaption><\/figure>\n\n\n\n

Isabelle de\nSilva, head of the French agency, guided our attention to the case of Engie from 2014\/2017<\/a> where her Autorit\u00e9 opened up the\nincumbent\u2019s database with customer data to other suppliers. She described this\nas a model approach to reconciling privacy issues with competition enforcement.\n<\/p>\n\n\n\n


Heike Schweitzer and you also were on a panel to explain, well, Germany.<\/strong><\/h3>\n\n\n\n

Sort of. Heike gave a brilliant account of the Facebook <\/em>saga, we both tried to explain how the German legislator now tries to pioneer in the field of digital (in my view, we neglect that this reform act is not just about taming GAFA but equally important tries to enable German<\/s> European companies to play in the field of Internet of Things). We also had to deal with that delicate question whether the courts put a brake on reform. Yes, they do, I think, but that is not entirely bad \u2013 it is their job. Still, some institutional reforms would be desirable. <\/p>\n\n\n\n

On Facebook<\/em>, we really need to give kudos\nto the Bundeskartellamt: That case is so intriguing\u2026 when I took the Thalys train\nhome after the conference to that other capital of antitrust (D\u00fcsseldorf,\nobviously!) I found myself squeezed in between a lawyer from the\nBundeskartellamt and a lawyer from the German Monopolies Commission. To the\npleasure of all other passengers in that coach we explained to each other what\nwe make of Facebook<\/em>, and with three\nGerman lawyers we had at least five different views. In my view\u2026 <\/p>\n\n\n\n


Okay, okay, I will read your next paper or just wait for the next court ruling on it. One more thing: Did the Commission actually take the stand?<\/strong><\/h3>\n\n\n\n
\"\"
Acting Director General Cecilio Madero Villarejo.<\/figcaption><\/figure><\/div>\n\n\n\n

Cecilio\nMadero Villarejo, the Acting Director General, gave the keynote, and of his\nspeech, I noted three things: Firstly, DG COMP sticks with the approach to make\nus believe that the Google cases and others present \u201cold wine in new bottles\u201d.\nI am not convinced, and I find that strategy too shy: I think it would be\neasier to win over judges if you frankly stated: Listen, these are new\nphenomena in the economy, and thus we had to come up with new concepts under\nArt. 102 TFEU. Fingers crossed, it works nonetheless. Secondly, Madero\nemphasised that timely intervention \u2013 without compromising the rights of\ndefence \u2013 will be a top priority for the second Vestager term. Thirdly, and\nvery much in line with Theofanis Christoforou from the Legal Service in a later\npanel, Madero criticised the standard of proof: There must be a reasonable\nlimit, so he said, to the standard of proof that we need to meet. Now, that\u2019s a\ndifficult one, I think, and without daring to ask I wondered whether that\nactually translates to \u201cThere must be a reasonable limit to economics in our\ncases.\u201d<\/p>\n\n\n\n


If I understood you correctly, you wanted to say \u201cold-fashioned economics\u201d.<\/strong><\/h3>\n\n\n\n

You\u2019re a quick learner!<\/p>\n\n\n\n

\n\n\n\n

Do say:<\/strong> \u201cIf we will not endure a king as a political power, we should\nnot endure a king over the\nproduction, transportation, and sale of any of the necessities of life.\u201d (John\nSherman as quoted by Luigi Zingales)<\/p>\n\n\n\n

Do not say:<\/strong> \u201cNo one understands big tech!\u201d (Joshua Gans\nquipping when asked \u201cDo regulators understand big tech?\u201d)<\/p>\n","protected":false},"excerpt":{"rendered":"

The conference circuit picked up speed again now that the end of this remarkable year is near. We were not able to attend everything out there but obviously if catering promises to be good Rupprecht Podszun is never too far – and so here is his Conference Debriefing from Woodstock! Name of Conference: Antitrust in Times of Upheaval Place & Time: Steigenberger Wiltcher\u2019s Brussels, 10 December 2019 Host: CRA, the economic consultancy, but really it is The Cristina Caffarra Show…<\/p>\n

Read More Read More<\/span><\/a><\/p>\n","protected":false},"author":4,"featured_media":3218,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[253],"tags":[12,89,305,205],"class_list":["post-3216","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-conference-debriefings","tag-digital-economy","tag-facebook","tag-gafa","tag-more-economic-approach"],"translation":{"provider":"WPGlobus","version":"3.0.0","language":"en","enabled_languages":["de","en"],"languages":{"de":{"title":true,"content":true,"excerpt":false},"en":{"title":false,"content":false,"excerpt":false}}},"_links":{"self":[{"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/posts\/3216","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/comments?post=3216"}],"version-history":[{"count":18,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/posts\/3216\/revisions"}],"predecessor-version":[{"id":3286,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/posts\/3216\/revisions\/3286"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/media\/3218"}],"wp:attachment":[{"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/media?parent=3216"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/categories?post=3216"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/tags?post=3216"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}