Should the WTO have a Role to Play in the Internationalisation of Competition Law?

Date01 January 2007
Should the WTO have a Role to Play in the
Internationalisation of Competition Law?
It can be said that competition law is national, while markets are
increasingly global. Yet there is no international antitrust code. The
key question is how to deal with transnational competition issues in
a global economy. How can competition authorities manage market-
place conduct that takes place in one nation, but has a harmful effect
in another? Konrad von Finckenstein (2001)1
In an increasingly globalised world, spurred on by comprehensive trade
liberalisation, regulatory reform, technological advancements and rapid
transportation, we find ourselves facing a problem that has been often
discussed but somewhat neglected since the Havana Charter in the 1940s.
The problem we essentially face is that the globalisation of the market-
place brings with it the risk of globalisation of anti-competitive practices.
Notwithstanding this, competition law and policy is still organised primarily
on the basis of nation-states. A disjointed international regulatory system
has evolved in which national governments have developed distinctive
approaches to the regulation of conduct that affects its country, often
without consideration of the effect of that regulation on other nations. The
progressive liberalisation of government restraints on trade by the GATT3
has highlighted the need for international cooperation in competition policy.
Indeed, concern has been expressed that public restraints on trade might be
in danger of being replaced by private restraints on trade.4It is universally
acknowledged that anti-competitive practices with an international
* Deirdre Ann Kelly LLB (Trinity) LLM (UCD), Trainee Solicitor with Dillon Eustace.
1Former Commissioner of Competition and head of the Competition Bureau of
Canada (1997–2003).
2Havana Charter,, accessed on 3
September 2007
3General Agreement on Tariffs and Trade,
sulpdf/90710265.pdf, accessed on 3 September 2007
4Woolcock, “International Competition Policy for the WTO Paper for the LSE
Commonwealth Business Council Trade Forum in South Africa”,
world tradeorganization.pdf, accessed on 8 September 2007
dimension can adversely affect trade flows, and consequently undermines
the benefits that would otherwise be delivered by trade liberalisation and
open markets.
The recognised limitation of domestic competition law in dealing with
anti-competitive practices with an international dimension,5combined with
the prospect of conf‌lict among nations as a result of inconsistent application
of competition law by different nation-states, has provided the impetus for
various proposals to construct an international competition policy. Indeed,
it is ironic that international antitrust is often referred to as one of the “new
issues” in the context of the World Trade Organization. Historically, the
potential for an international competition agreement was originally recog-
nised with the Charter for an International Trade Organization in 1945.
However, by the time the negotiations on the ITO Charter were successfully
completed in Havana in 1948, international competition obligations had
been omitted from its remit. The issue lay dormant for many years and, in
the absence of a multilateral agreement on competition policy, bilateral,
regional and plurilateral agreements on competition policy f‌illed this vacuum.
Subsequently, in 1994, the Agreement Establishing the WTO included a
range of limited provisions addressing various cross-border competition
issues on a sector specif‌ic basis. Furthermore, the Organization for Economic
Cooperation and Development (OECD), the United Nations Conference on
Trade and Development (UNCTAD) and the WTO have established
committees to further consider international competition issues, and have
promoted the evolution of cross-border competition laws. More recently,
WTO Ministerial Conferences in Doha (2001) and Cancun (2003) have
contemplated formal WTO negotiations on competition law and policy.
However, debates have raged about the suitability of the WTO as a
forum to regulate international competition policy.6
Although competition policy and trade policy share the common goals of
increasing efficiency and encouraging market access, they can conflict in
that competition policy can clash with the market access goal of trade policy
insofar as national competition authorities often ignore the anti-competitive
effects of their firm’s actions on other countries and may even tolerate
or encourage export cartels or mergers whose adverse impact falls
predominantly on foreign consumers.7
Opponents of a global approach contend that antitrust regulation can be
solved at national and nation-to-nation level. This is the approach adopted
5For more on this see Shelton, “Competition Policy: What Chance for International
Rules?” (1999) 2 OECD J. Competition L&Pol’y pp 57–60
6Fox, “Global Markets, National Law and the Regulation of Business: A View From
The Top” (2001) 75 St John’s L Rev 383, 396
7Bhattacharjea, “The Case for a Multilateral Agreement on Competition Policy:
A Developing Country Perspective” (2006) Journal of International Economic Law
Vol 9 No 2

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