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The world today is still lacking a global framework of cooperation for dealing with the issues of monopolies, price fixing, cartels, mergers and other anticompetitive practices imposed by large firms. They are having a negative effect on the development of the global market. Improving consumer welfare and economic freedom poses various challenges for global competition governance. But this is only part of the murky picture. Added to this are the fundamental questions: What should the global competition regime serve? Who would support this project? How to find a solution to encourage the leadership to move to the negotiating table?
Unfortunately, all effort to create a problem-solving mechanism on a global scale has so far been ill-fated and these questions are no longer attractive in the policy debate. They are various but the following paradox aspects which led up to the impossibility of cooperation are central.
Presently, the global recession, global counterterrorism, global warming and the sovereignty debt crisis are the most pressing political priorities of the time. All of the above external shocks and internal changes together, including competition issues, are taking the leadership to a new paradigm of global governance. As yet no major new theory has taken root in the scholarship to explain how the leadership should act. Of course the global competition regime has been and is only one of the factors contributing to shaping the new global governance, and it still lacks leadership.
In this truly multi-polar world, the traditional pattern of global leadership is simply obsolete. Due to contemporary political paralysis and economic recovery measures, the US and EU can no longer afford their leading role in global economic governance. It is not surprising that they are turning their focus to how domestic market development can best be protected. As long as they remain skeptical about the virtues of the competitive global market, they will have no incentive to change their deeply-rooted preferences on competition policy in favor of a globally-oriented approach.
Given that the US would give up any pretense of leadership on antitrust matters, it is hard to imagine that it would disregard the lobbying interests of business firms dealing with international cartel. This is exactly what the EU is doing with developing countries. The main objective of Free Trade Agreements (FTAs) is to serve only the interests of the US and EU. More specifically, thirty-five African, Caribbean and Pacific (ACP) countries have accepted the Economic Partnership Agreements (EPA) with the EU. EU-FTAs must contain binding commitments to put in place and implement competition policy that follows the European model
Encouragingly, the year ahead is a time not for seeking a sound balance between the different objectives in transatlantic affairs but rather for expanding a developmental conception of what a global cooperation may plausibly look like, and making this more explicit. For the first time in modern history, major emerging market countries are driving the global economy and will collectively account for more than half of all global growth. The economies of developing countries are expanding rapidly. The world economy has never depended so much on the success of developing countries as it does today. Developing economies need visionaries to see the opportunities and to have a voice in shaping global competition governance.
However, developing countries’ policymakers are currently strongly advocating that opening the market is more important than other public policies in the trade liberalization process. To this end, they maintain that market access, not a competition matter, should be prioritized on the agenda. Importantly, the major emerging countries and like-minded developed countries have been willing to back such FTAs as well, but China, Brazil, India, Indonesia, South Africa and Russia lack the resources to take charge of the future competition regime.
Most importantly, the increasing heterogeneity and diverging interests of developing countries make this wishful thinking worse because there is no pressure to bring together leading thinkers and practitioners on competition law and policy to consider this possibility either generally or specifically. This is one reason why it is most unlikely that they will bring the global approach back on track.
The global approach to antitrust matters, with all of its legal, economic and socio-cultural aspects, is proving a most difficult project; its future remains uncertain, at best, and much remains to be done as we should be discussing the most likely way that this can be initiated in the future. While governments’ concern about global competition governance continues to decrease, the world should be losing its gains that a successful cooperation would have brought.