{"id":3469,"date":"2020-03-13T18:35:10","date_gmt":"2020-03-13T17:35:10","guid":{"rendered":"https:\/\/www.d-kart.de\/?p=3469"},"modified":"2020-03-13T18:39:43","modified_gmt":"2020-03-13T17:39:43","slug":"conference-debriefing-19-ag-wettbewerb-des-vereins-fuer-socialpolitik","status":"publish","type":"post","link":"https:\/\/www.d-kart.de\/en\/blog\/2020\/03\/13\/conference-debriefing-19-ag-wettbewerb-des-vereins-fuer-socialpolitik\/","title":{"rendered":"Conference Debriefing (19): AG Competition (Verein f\u00fcr Socialpolitik)"},"content":{"rendered":"\n

A few days ago there was a conference on competition issues that was not cancelled. Hooray! In Berlin, the competition working group of the renowned German economists’ club “Verein f\u00fcr Socialpolitik” met. Prof. Dr. Andreas Polk<\/strong> was on site and reports for D’Kart about the last meeting of its kind for some time…<\/em><\/p>\n\n\n\n

This year’s\nmeeting of the Competition Working Group, which traditionally meets before the\nEconomic Policy Committee of the Verein f\u00fcr Socialpolitik, was not yet entirely\ndominated by a Mexican brew. But Corona was already wafting through the room:\nshaking hands was replaced by understanding smiles, and some participants were\nalready afraid to pick up their neighbour’s highly toxic pen. All in all,\nhowever, everyone remained exemplarily calm and relaxed, the atmosphere was\npleasantly concentrated. So let’s deal with the two main topics of the\nconference, EU reforms on vertical and horizontal restraints and – surprise\nsurprise! – the 10th amendment to the German competition act (GWB).<\/p>\n\n\n\n

Name of the event: <\/strong>Meeting of the Competition Working Group of the\nVerein f\u00fcr Socialpolitik<\/p>\n\n\n\n

Topic: <\/strong>Reforms in German and European antitrust law<\/p>\n\n\n\n

Time and place:<\/strong> TU Berlin, 2 – 3 March 2020<\/p>\n\n\n\n

Hosts:<\/strong> Prof. Dr. Christian von Hirschhausen (host),\nTU Berlin; Prof. Dr. Justus Haucap, HHU D\u00fcsseldorf & DICE (conference\norganisation)<\/p>\n\n\n\n

Audience:<\/strong> Approximately 20-30 professors from the field\nof competition policy (all male plus one female junior academic)<\/p>\n\n\n\n

Part 1: The amendment of\nthe GWB<\/h2>\n\n\n\n

The meeting\nstarted with an introduction to the 10th amendment of the GWB by Dr. Thorsten\nK\u00e4seberg, head of the competition unit in the Federal Ministry of Economics and\nEnergy. He gave a very nice overview of the current state of the reform, which\nhowever has already been sufficiently presented in this blog. For the Newbies\nin short: The current draft of the bill provides for numerous changes. Most\nnotably are innovations in abuse control and changes for merger thresholds.\nHere is a brief – and above all not complete – overview.<\/p>\n\n\n\n

Abuse control:<\/h2>\n\n\n\n

– New\ncriteria for the assessment of the market position (section 18 GWB), in\nparticular the addition of the criterion “access to competition-relevant\ndata” in section 18 (2), as well as the introduction of the concept of\n“power of intermediation” in section 18 (3);<\/p>\n\n\n\n

– New\nversion\/addition of the “essential facilities doctrine” in section 19\n(2), including the idea of data access;<\/p>\n\n\n\n

–\nProtection against relative market power is no longer limited to small and\nmedium-sized enterprises in section 20 (1);<\/p>\n\n\n\n

– Danger of\ntipping becomes a ground of action for section 20 (3a);<\/p>\n\n\n\n

– and of\ncourse the new section 19a, which addresses undertakings with paramount\nsignificance for competition across markets and which provides for a reversal\nof the burden of proof.<\/p>\n\n\n\n

Merger control:<\/h2>\n\n\n\n

– raising\nthe domestic turnover threshold from EUR 5 million to EUR 10 million (section\n35 GWB), and modification of the minor markets clause to EUR 20 million\n(section 36 GWB).<\/p>\n\n\n\n

–\nPossibility for the Bundeskartellamt to request notification from certain\ncompanies even with a lower threshold (section 39a GWB).<\/p>\n\n\n\n

Regular\nreaders of this blog are probably more than familiar with these changes, so\nthat further explanations are omitted. Among other things, the question of how\nthe number of cases at the BKartA would change due to the modified merger\nnotification thresholds was interesting. This question only came up later at\nthe meeting of the Economic Policy Committee (at a time when Dr. K\u00e4seberg was\nalready back at his desk in Scharnhorststra\u00dfe and therefore could not give an\nassessment). Nevertheless, the participants looked at each other with questioning<\/s>\ninterest, because they did not know any official figures on this. According to\nrumours, a decrease in the annual number of cases in the order of 200-300 is\nexpected, which still leaves a stately 1,000 cases per year for the authority\non the Rhine. <\/p>\n\n\n\n

With regard\nto the effects of this regulation and its future assessment, two aspects were\ndiscussed:<\/p>\n\n\n\n

– Certainly\npositively, case-economies play a role: the lower number of cases reduces the\nworkload, so that staff can devote more time to interesting and important\ncases.<\/p>\n\n\n\n

– It\nremains to be seen how many relevant cases will now fall out of focus. It has\nbeen stated that these will probably be mainly cases that are terminated in the\nfirst phase with commitments from the companies involved. But to what extent?\nWe do not know, but we trust the legislator to have chosen the new thresholds\ncarefully.<\/p>\n\n\n\n

Note 2: The\nattempt to place the current GWB reform in a historical\/global context was also\na nice one. Here keywords on Hipster Antitrust<\/a> or\nLina\nKhan<\/a> were found, but Walter Eucken and Jean Tirole were also mentioned\n(both of which do not need to be linked here).<\/p>\n\n\n\n

Note 3:\nAlso very nice: the various references to the various studies, which had been\nstudied attentively in public administration. Here not only the report of Schweitzer\/Haucap\/Kerber\/Welker<\/a>\nis to be mentioned, which in many aspects has been (or will be) included in the\nnew GWB amendment. Various talks referred to the reports from Furman<\/a>\nor Cr\u00e9mer\/de\nMontjoye\/Schweitzer<\/a>. This may point at a wider desire to include scholarly\nadvice into law-making. If (not without reason) a greater involvement of the\nresearch community in political decision-making is asked for, the Ministry has\nalready left a good impression with this amendment.<\/p>\n\n\n\n

Finally, a\nsmall goodie, since it is interesting what has not been included in the current\namendment. Question: What does this picture point to? (German soccer fans may\nhave their go!)<\/p>\n\n\n\n

\"\"
Mario G\u00f6tze (photo by wikipedia-user Rufus46 under CC licence)<\/em><\/figcaption><\/figure>\n\n\n\n

Right!\nKiller acquisitions are not an issue in the current amendment.<\/p>\n\n\n\n

From a research perspective<\/h2>\n\n\n\n

The meeting\ncontinued with contributions from researchers who are strongly involved in\npolitical practice. Wolfgang Kerber from Marburg gave a nice overview of the\nstate of the art in data and market power, and Achim Wambach (Monopolies\nCommission, ZEW) presented interesting facts on market concentration and\nrelative price mark-ups.<\/p>\n\n\n\n

Kerber on data<\/h2>\n\n\n\n

Kerber\nsubdivided the questions of data power into questions of information power and\nmarket power. Information power can always arise where information is unequally\ndistributed (“asymmetric information”). In a static context, this\ncould be, for example, the much feared but so far only rarely observed form of\nindividual price discrimination, but also unequal power relations between\ncompanies and consumers (keyword: manipulation of search results,\nself-preferencing or rankings). Of course, the dynamic perspective is also\nthrilling: To what extent can data handling lead to market foreclosure &\ntipping, and how does leverage work (i.e. the transfer of market power on one\nmarket to neighbouring markets, which can also be upstream or downstream)?<\/p>\n\n\n\n

This led\nstraight to the central issue: How to deal with it? Here, of course, we come\nback to the 10th amendment, as it contains innovations on the topic of data and\ndata access. The questions can certainly not be solved in one fell swoop, so\nhere as a mini-service is a basic classification of central questions:<\/p>\n\n\n\n

\"\"
Wolfgang Kerber (photo by Carmen Schulin)<\/em><\/figcaption><\/figure><\/div>\n\n\n\n

1. who owns\ndata in the first place (question of “ownership rights”)?<\/p>\n\n\n\n

2. to which\ndata should access be granted (question of data access)?<\/p>\n\n\n\n

3. What\nincentive effects do various access or regulatory requirements have, especially\nwith regard to innovation and competition (question of effect)?<\/p>\n\n\n\n

To quote a\ncolleague from D\u00fcsseldorf: “Future\ndoctoral students are always pleased when they find a lot of material.<\/a>“<\/p>\n\n\n\n

Wambach on mark-ups<\/h2>\n\n\n\n

After all\nthese important, but also confusing topics around competition, data, GAFAs and\nthe GWB amendment, the participants were allowed to clear their heads with\nanother related topic: Do we really observe constantly rising price mark-ups\nand an increase in market power over time? And if so, what are possible causes?\nThese questions, which have caused a stir with interested people for some time\nnow, can be traced back to research work by De Loecker, Eeckhout and Unger,\njust published in the QJE. Tendency: We see rising price attacks, but these are\nmainly driven by a few companies, the median mark-ups have hardly changed. Does\nthis also apply to Germany and Europe?<\/p>\n\n\n\n

With this\ncliff-hanger, we could of course now go into looking at the research yourself\n(now that the virus gives us some time for reading) (e.g. the paper\nby De Loecker et al.<\/a> or the website of the Monopolies\nCommission<\/a>). But of course I do not want to let you go quite like that. In\nshort: The picture currently emerging in Germany and in other European\ncountries is mixed. While the development of concentration in Germany (measured\nby the HHI by four-digit economic sectors), but also the average price mark-ups\nremained more or less constant over the last decade, for other countries (e.g.\nSwitzerland, Denmark, and to some extent Italy) there has been an increase in\nprice mark-ups from 1980 to the present.<\/p>\n\n\n\n

It is\nquestionable what is driving these effects. Some explanations around are an\nincrease in intangible assets (if the cost structure changes from variable to\nfixed costs, the reported price mark-ups increase when prices remain constant),\nthe role of increasing digitisation, a weaker diffusion of innovation, an\nenforcement deficit on the part of the antitrust authorities, or increasing\ncorporate links between institutional investors. Which brings us back to\ncompetition policy with the last two points…<\/p>\n\n\n\n

And here is from practice<\/h2>\n\n\n\n

The nice\nthing about the Competition working group is that the academic world doesn’t\nwant to shield itself from practitioners. So this year, too, there were again\nseveral speakers from the world of practice who commented on the current\namendment from their respective perspectives and greatly enriched the\ndiscussion. J\u00f6rg Karenfort, Partner at Dentons Europe LLP, commented on the\namendment from a legal perspective, particularly in light of the positions of\nthe German Studienvereinigung Kartellrecht (the German antitrust bar\nassociation). He also raised the question of what effect raising of the second\ndomestic turnover threshold in section 35 GWB and the minor markets clause in\nsection 36 GWB will have. It may be too restrained so that it will hardly have\nany practical impact? Michael Menz from retail platform Zalando spoke about the\nchallenges for digital platforms from a business perspective. From his point of\nview, new challenges for market definition arise (does the shop around the\ncorner compete with digital companies?), but his company also focuses on the\ntopics of data access and data cooperation. His plea for binding rules is\nunderstandable, companies need legal certainty. He backed the interesting idea\nthat market power should perhaps be measured less by market share and more by\nthe time spent on certain websites (“total consumer time”). Time will\ntell what happens!<\/p>\n\n\n\n

Part 2, but only briefly\nhere: The amendment of the EU Horizontal Guidelines and the Vertical BER<\/h2>\n\n\n\n

The second\npart of the meeting dealt with the revision of the horizontal guidelines and the\nvertical BER on the EU level. Christian Stempel, Division G1 at the\nBundeskartellamt, introduced the topic (keywords: “safe-harbour”\nrequirements, hardcore restrictions and examination procedures). Subsequently\nAndreas Gayk of Markenverband and Peter Schr\u00f6der of Handelsverband Deutschland,\ntwo trade associations, gave their assessment of the amendments. Afterwards, a\nvery interesting discussion unwound, which led to a flashback of about 20 years\nago: Already during my studies in Heidelberg, we had discussed in detail in\nProf. Siebke’s courses whether market forces should be suspended in favour of\n“special” goals. Replace “environmental protection” and\n“social standards” (then) with “public welfare” and\n“animal welfare” (today), and the debates are already strikingly\nsimilar. The participants largely agreed that animal protection, democracy and\norientation towards the common good are of course important objectives worth\nprotecting. The only question is whether they should be achieved by suspending\ncompetition. Not surprisingly, what view the majority of those competition\neconomists in the room held. <\/p>\n\n\n\n

Keep safe!<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Prof. Dr. Andreas Polk is Professor of\nEconomics, especially Industrial Economics, at the Berlin School of Economics\nand Law. He deals with questions of competition policy and regulation as well\nas the analysis of lobbying.<\/em><\/p>\n\n\n\n

Website:\nhttps:\/\/www.hwr-berlin.de\/prof\/andreas-polk\/<\/em><\/p>\n\n\n\n

Twitter: @RuhrPottPolk<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

A few days ago there was a conference on competition issues that was not cancelled. Hooray! In Berlin, the competition working group of the renowned German economists’ club “Verein f\u00fcr Socialpolitik” met. Prof. Dr. Andreas Polk was on site and reports for D’Kart about the last meeting of its kind for some time… This year’s meeting of the Competition Working Group, which traditionally meets before the Economic Policy Committee of the Verein f\u00fcr Socialpolitik, was not yet entirely dominated by…<\/p>\n

Read More Read More<\/span><\/a><\/p>\n","protected":false},"author":11,"featured_media":3471,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[253],"tags":[3,318,319],"class_list":["post-3469","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-conference-debriefings","tag-gwb-novelle","tag-konzentration","tag-verein-fuer-socialpolitik"],"translation":{"provider":"WPGlobus","version":"3.0.0","language":"en","enabled_languages":["de","en"],"languages":{"de":{"title":true,"content":true,"excerpt":false},"en":{"title":true,"content":true,"excerpt":false}}},"_links":{"self":[{"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/posts\/3469","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\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/comments?post=3469"}],"version-history":[{"count":5,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/posts\/3469\/revisions"}],"predecessor-version":[{"id":3478,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/posts\/3469\/revisions\/3478"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/media\/3471"}],"wp:attachment":[{"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/media?parent=3469"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/categories?post=3469"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.d-kart.de\/en\/wp-json\/wp\/v2\/tags?post=3469"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}