‘Recent Competition Policy and Law Developments in China and Hong Kong’

After a short break, the CCP Seminar Series returns in 2016 with another inspiring line-up of presentations on competition policy (you can find out more by clicking here). On Friday 8th January 2016, we are delighted to welcome Mark Williams (Asian Competition Forum and Melbourne Law School) who will be kicking-off the year with his dissection of the ‘Recent Competition Policy and Law Developments in China and Hong Kong‘. Mark is the Executive Director of the Asian Competition Forum, as well as a Professor of Law at the University of Melbourne Law School where he teaches inter alia competition law and Hong Kong company/commercial . An abstract for his seminar can be found below.


Mainland China brought the Antimonopoly Law into force in 2008. The intensity of enforcement has increased markedly in the last two years, especially in relation to business conduct within its territory as opposed to global mergers that have some effect on Chinese markets. Whilst the application of the merger rules has been relatively orthodox, there has been increasing concern about the activities of the NDRC and SAIC with regard to ‘price monopoly’ cases. Transparency and due process issues have caused considerable anxiety, especially amongst the international business community and it is noteworthy that there have been no judicial appeals against any decision of the Chinese agencies since the antitrust system became operational. In Hong Kong, which retains its separate common law -based legal system, the Competition Ordinance only became fully operational on 14 December 2015. This structurally flawed system, that has no merger control provisions save in the telco sector, and adopts a judicial enforcement model, is, necessarily, wholly untried. This seminar will concentrate on recent developments in both systems and the challenges they face to attain international credibility.

The seminar takes place from 13:00-14:00 in the Thomas Paine Study Centre, Room 1.03. Tea will be provided directly afterwards in the MBA Café (TPSC, Floor 2).

‘Do Competition Authorities’ Cartel Investigations exhibit a Life-Cycle?’

The Spring Seminar Series continues on Friday 27th February with our master empiricist Prishnee Armoogum (CCP & ECO) asking ‘Do Competition Authorities’ Cartel Investigations exhibit a Life-Cycle?‘. Prishnee is a PhD researcher and Associate Tutor in the School of Economics at the University of East Anglia. Her thesis topic explores the experiences of competition enforcement across different competition authorities around the world, with a particular interest in small economies. Prishnee is also a member of the Competition Commission of Mauritius. An abstract for her paper can be found below.


Although there are numerous recent papers which have studied the relationship between deterrence and cartel formation, there is not much literature on the empirical assessment of the Competition authority’s behaviour in the presence of deterrence. The purpose of this paper is to investigate the presence of deterrence on cartels during the life cycle of a competition authority (CA). The intuition of proposed theory developed in this work is used to study the lifecycle of the CA and the impact of competition law and policy deterrence on its cartel activities. A yearly panel data set of 32 countries (33 competition institutions) for period 2006-2012 is used empirically to test the model. Choosing the most preferred model, we find that the number of cartel investigations do not have a life cycle. However, the results show that tools used to deter cartels, i.e. cartel fines, years of imprisonment and number of leniency applications, do have an influence on the number of cartel investigations. The number of phase II merger investigations is also found to be negatively related to the number of cartel investigations.

The seminar takes place from 13:00-14:00 in the Thomas Paine Study Centre, Room 1.03.

‘Recent Trends in EC and UK Merger Control and Theories of Harm’

The CCP Seminar Series continues on Friday 14th November with the ever-captivating Bruce Lyons (CCP & ECO) presenting his research on ‘Recent Trends in EC and UK Merger Control and Theories of Harm‘. Bruce is a Professor of Economics at the University of East Anglia and has published extensively on the topic of merger control, including manuscripts on UK merger control and EU merger remedies.  An abstract for his presentation can be found below.


This seminar provides an empirical overview of selected areas of competition enforcement by DG Comp and the CMA.  It is in two distinct parts reflecting forthcoming and recent policy presentations given in Brussels and London.  First, I review some trends and recent cases reviewed under the EU merger regulation.  A particular focus is on theories of harm used by DG Comp.  I also consider the efficiency defence in mobile telecoms and financial viability as a determinant of the counterfactual.  Second, I provide a brief overview of the first seven months of the CMA.  In which enforcement areas does the merger of the OFT and CC seem to be doing well and where is its early progress problematic?

The seminar takes place from 13:00-14:00 in the Thomas Paine Study Centre, Room 1.03.

‘Bismarck vs Beveridge: what can healthcare-specific merger control in the Netherlands and England achieve?’

The CCP Spring seminar series reaches its conclusion on Friday 10th July with the magnificent Mary Guy (CCP and UEA Law School) presenting the preliminary findings of her latest research project, entitled ‘Bismark vs Beveridge: what can healthcare-specific merger control in the Netherlands and England achieve?‘. An abstract for her presentation can be found below.



Despite representing two very different healthcare models – a Bismarck health insurance system and Beveridge national health service funded by general taxation, respectively – the Netherlands and England are experiencing a number of similarities as they introduce competition into healthcare. These include modifications to the assessment of (typically) hospital mergers after gradually applying general merger control to the healthcare sector.

In the Netherlands, following initial reluctance to subject hospitals to general merger control (which is closely related to the EU regime), there have been moves to modify the assessment process following a range of controversial merger decisions. These modifications started with a reduction in turnover thresholds and the adoption of specific assessment criteria and in 2014 have culminated in the implementation of a controversial statutory “healthcare-specific” test, which sees the healthcare and quality regulators examine a proposed merger prior to determination by the ACM.

In England, the traditional distinction between the Private Healthcare (PH) sector and the NHS was reflected in the practical application of the general merger test of the Enterprise Act 2002 (EA02) to the former and a non-statutory NHS merger test to the latter. However, the Health and Social Care Act 2012 (HSCA 2012) has prompted two potentially significant changes to healthcare merger review in England. Firstly, mergers involving NHS Foundation Trusts are now subject to EA02 and Monitor, the economic regulator for healthcare, has an advisory function in relation to these. Secondly, the removal of the private patient income cap by the HSCA 2012 has led the CMA to respond to an anticipated increased in Private Patient Unit (PPU) transactions by proposing a new test.

As the ultimate competence to determine mergers remains with the competition authorities in both countries, what can be achieved by regulator input and modified tests is perhaps questionable. However, the sensitivities which attach to healthcare in general (with regard to the continuity and affordability of care) suggest that there is a need to consider carefully how merger control is to be applied in a transition (and “problem”) market, particularly given the increasing lack of Ministerial competence in this area in both countries.

This presentation considers some of the difficulties of assessing hospital mergers, such as defining markets and how public interests have been reflected in both countries. It then proceeds to consider the development of “healthcare-specific” merger tests in light of what these can achieve in terms of developing competition in the sector and addressing non-competition concerns such as patient interests.

The seminar will take place from 13:00-14:00 in the Queens Building, Room 0.08.

From the CCP, we thank all of those who have presented this semester. The Seminar Series will return after the Summer break on Friday 19th September 2014. Further information will be posted on our Seminar Series pages in due course, where you can also access additional information on previous seminars.

CCP Research Bulletin, Issue 27 – Now available

The Summer 2014 edition of the CCP Research Bulletin is now available for download [PDF, 332KB].

Research Bulletin (Summer 2014)

Articles in Issue 27 include:

‘At last, a competition inquiry for energy – will it bring relief or disappointment?’ (Catherine Waddams)

‘Differentiated tax on differentiated products markets’ (Anna Rita Bennato and Franco Mariuzzo)

‘The processes for regulatory appeals: One size does not fit all’ (Despoina Mantzari)

‘Do small business customers need more buyer protection?’             (Amelia Fletcher, Antonios Karatzas and Antje Kreutzmann-Gallasch)

‘What happens when collusive firms try to avoid antitrust punishment?’ (Subhasish M. Chowdhury and Frederick Wandschneider)

‘The use of general merger control in English healthcare’ (Mary Guy)

Plus: News from CCP, upcoming events and our book launch.

‘Collusion under Private Monitoring with Asymmetric Capacity Constraints’

On Friday 21st March 2014, the Centre welcomes the return of an old friend in the form of former CCP Research Associate and Post Doctoral Fellow Luke Garrod (Loughborough University). Luke will be presenting his paper entitled ‘Collusion under Private Monitoring with Asymmetric Capacity Constraints‘ which he has written with fellow CCP alumna Matthew Olczak (Aston University). An abstract for their article can be found below.


We explore the effects of asymmetries in capacity constraints on collusion where demand is uncertain and where firms must monitor the agreement through their privately observed sales and prices. We show that deviations will be detected perfectly when demand fluctuations are sufficiently small. Otherwise, monitoring is imperfect and punishment phases must occur on the equilibrium path. Collusion is hindered in both cases when the largest firm has more capacity and when the smallest firm has less. We demonstrate that a merger with a collusive symmetric outcome can have a lower average best equilibrium price than a more asymmetric noncollusive outcome.

The seminar will take place from 13:00-14:00 in the Thomas Paine Study Centre, Room 1.1.

Policy Briefing – ‘Mergers after cartels: How markets react to cartel breakdown’

Policy Briefing of CCP Working Paper 14-1:

Davies S, Ormosi P and Graffenberger M, ‘Mergers after cartels: How markets react to cartel breakdown‘ (Available to download from Working Papers 2014 on the CCP website).


  • Anti-cartel enforcement is widely heralded as the single most important part of antitrust activity. But there have been only a few studies analysing how markets react to the elimination of cartels.


  • The authors approach cartel detection from a dynamic perspective by analysing what happens in markets in the years after a competition authority has detected a cartel. At issue is whether markets revert to competitive behaviour or whether firms find alternative ways of reinstating collusive equilibria (short of cartelisation) in the longer run.

  • Data was collected on mergers, acquisitions and joint ventures between firms involved in those cartels for which the European Commission issued decision documents between 1990 and 2012. The useable sample is 84 cartels that were detected between 1984 and 2009.

  • Three questions are posed:

1. Was there more intense merger activity amongst the former cartelists in the years immediately following breakdown?

2. Were certain types of cartel more likely than others to be followed by merger?

3. Is there evidence that the competition authority intervened in those proposed mergers which were most likely to raise potential anti-competitive concerns, or is there evidence of deterrence of such mergers?

  • The authors employ a novel application of survival analysis.

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‘Fizzy logic: How to measure competition between IRN BRU and Pepsi’

The Spring seminar series continues with a special mid-week edition on Wednesday 5th February, co-organised by CCP and our friends at the Norwich Business School.  The seminar sees the welcome return of Adrian Majumdar, an RBB Economics partner and CCP alumnus, who will be presenting ‘Fizzy logic: How to measure competition between IRN BRU and Pepsi‘. The seminar will take place from 13:00 in Room 2.01 of the Thomas Paine Study Centre, with Amelia Fletcher acting as discussant. An abstract for Adrian’s seminar can be found below.


In 2013, the UK Competition Commission (CC) cleared unconditionally (i.e. without remedies) a merger between AG Barr (distributors of IRN BRU) and Britvic (distributors of Pepsi). Ultimately the merger did not proceed, not least due to the OFT (the Phase I merger body) having referred the merger to the CC for a Phase II review. This presentation summarises key points of the case and compares and contrasts the approach taken by the OFT and the CC. We highlight the pros and cons of the growing role of back-of-the-envelope simulations (price pressure tests) in the UK (and now DG Competition) in merger analysis. These measures employ measures of closeness of substitution (diversion ratios) and accounting margins in simple formulae to inform the competition authority about whether or not a merger may be harmful. We ask:

• Does the OFT measure diversion ratios correctly and does the OFT place excessive weight on accounting margins at Phase I?

• What evidence on substitution patterns should count the most – price pressure tests, econometric assessment of switching, surveys, customers’ views, delisting events, advertising policies?

• Is there a role left for market definition in mergers?

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‘Reconsidering the role of the public interest in UK merger control’

The CCP’s Autumn Seminar Series continues on Friday 11th October with David Reader (CCP and UEA Law School) presenting his research on ‘Reconsidering the role of the public interest in UK merger control‘. An abstract for his seminar can be found below.


The United Kingdom’s merger control regime can be considered one of the most robust in existence. Under the Enterprise Act 2002, mergers shall be assessed by at least one of two independent competition authorities who each apply the same competition-based criteria to every transaction. There remains, however, a power for political intervention by the Secretary of State in mergers raising certain specified public interest concerns. In these cases, the Secretary of State may permit an anticompetitive merger or block a pro-competitive one where they consider that it is in the public interest to do so. Moreover, the Secretary of State retains a residual power to add to the list of specified public interest criteria, subject to Parliamentary approval.

In light of several controversial transactions – including Lloyds/HBOS, Cadbury/Kraft and NewsCorp/BSkyB – this presentation seeks to reconsider the way in which the public interest provisions under the Enterprise Act may be used to complement the UK’s merger policy. In particular, it will consider the legitimacy of Lord Heseltine’s calls for the Government to ‘show a readiness’ to use the public interest provisions to protect vital national interests and to deter unwanted foreign investment. The presentation will also seek to examine the potential for the public interest exceptions to be added to in the future and whether a decision-making role for the new Competition and Markets Authority could be on the agenda.

Related reading: Bruce Lyons, ‘Beware of Siren Advice for Political Control of Foreign Mergers‘ (2012) Competition Policy Blog.

NIE Conference Papers (I)

Last Friday CCP hosted the 2012 NIE winter conference. We’d like to share some of the papers with you.

Kathleen Nosal, University of Mannheim, Department of Economics presented “Estimating switching costs for Medicare advantage plans”

Gautam Gowrisankaran, University Arizona, Department of Economics discussed “Mergers when prices are negotiated: Evidence from the hospital industry”

We will hopefully have some photos to show you in the New Year.