Rating Enforcement 2018

Introduction

26 September 2018

Welcome to the 18th edition of Rating Enforcement, Global Competition Review's annual survey of the world's leading competition authorities.

Every year since 2001, GCR's editorial team has taken the measure of antitrust enforcement programmes around the world, combining data supplied by the agencies with our own reporting and the feedback of lawyers, economists and local journalists who interact with competition authorities. The goal is to understand how well each enforcer used the tools available to it – its legal powers, resources and influence – to deter and stop anticompetitive activity in 2017. Both quantity and quality matter. What does it profit an agency if it brings many cases, but loses every one against which the companies appealed? Nor do these ratings live by enforcement actions alone; we also weigh a competition authority's transparency, analytical sophistication, effectiveness in educating governments and people, and more.

This means that there is no simple formula for becoming – and staying – a top antitrust enforcer. Nearly every aspect of an enforcer comes into play: its budget, the number of non-administrative personnel and their experience, independence from politicians, responsiveness to businesses and results for the people. We listen to what practitioners and the press in a jurisdiction say about their competition authority, but not just for compliments and complaints. An agency can be unpopular because it is capable, or beloved because it targets foreign competitors to the advantage of national champions.

Rating Enforcement aims to analyse and describe what competition authorities have accomplished, while remaining cognisant that every agency faces constraints on its resources and its legal powers. Some, such as the US Department of Justice's antitrust division, need external, non-specialist courts to approve their enforcement actions. Many, such as Belgium's Competition Authority, have to attract staff tempted by more lucrative options; indeed, any agency that is more than a rubber stamp for companies will plant the seeds of a private defence bar that will compete with it for talent. And a few are riven by internal disagreements that can limit efficiency and productivity.

Research

Each year, GCR sends a detailed questionnaire to the competition authorities canvassing all aspects of enforcement. The data we request ranges from the size of the authority to the average age and tenure of the staff; from the methodology for setting priorities to the agency's record when defendants appeal its decisions. We also ask for information about the number of mergers notified and the agency's reaction to those deals; a detailed breakdown of cartel and abuse of dominance work; and a self-assessment by the head of the agency. This requires a significant effort by the authorities' staff, without which we could not clearly outline how they spent the past year.

Colouring in that outline involves confidential feedback from the people who know a competition authority best: antitrust lawyers and economists, in-house counsel, scholars and local journalists who routinely cover the agency's work. Interviews with leading international competition practitioners who have the freedom to speak anonymously allow GCR's reporters to gain insight on the authorities' performance, as well as their professionalism and independence.

During the course of the year, GCR's daily task is to learn and write about enforcers' work, with more than 1,500 news stories published annually. Our briefings highlight antitrust news around the world, from the new leadership of the US antitrust agencies to the will-they-or-won't-they saga of cartel criminalisation in New Zealand. The breadth and depth of our news coverage provides an unparalleled resource for determining the strengths and weaknesses of the agencies we review.

GCR also conducts monthly surveys of the competition landscape in different jurisdictions, meeting with prominent figures in the local antitrust bar and interviewing the head of the national competition authority. Since the last edition of Rating Enforcement, we have surveyed Argentina, Brazil, Brussels, Canada, Greece, India, Indonesia, Ireland, Italy, Massachusetts, Russia, Singapore and Taiwan.

We attend every major competition conference, including the International Competition Network's annual gathering and the American Bar Association's antitrust spring meeting; we also host more than a dozen of our own events each year in Europe, the US and Asia.

Reading the results

The subheading of Rating Enforcement – “the annual ranking of the world's leading competition authorities” – is significant. Agencies that essentially exist in name only, or whose enforcement actions have few ramifications beyond their borders, do not appear in this publication. While any rating inevitably draws focus to where one is ranked, every authority listed on the previous page is an enforcer that demands the attention of the competition community.

Our analysis rates each authority on a scale of one to five stars. For this scale to be meaningful, we must make distinctions – sometimes narrow ones – between agencies, and attempt to compare enforcers with disparate resources and areas of accomplishment. Of more than a dozen competition authorities that won three-star ratings, for example, some are impressive cartel fighters while others are notable for their compelling insight in merger control or assessments of market dominance.

Each agency's chapter also includes a performance indicator in addition to the star rating. If an agency is improving upon its previous accomplishments, this is indicated with an “up” arrow. A horizontal arrow shows that an authority performed as expected, while a “down” arrow reflects a disappointing year. Because the star rating is a blunt tool that comes only in whole and half stars, the arrow also shows which agencies are trending up or down.

This year, the overview analysis of the quantitative data collected goes deeper into questions about enforcement that are on the minds of antitrust observers around the world. We consider the relationship between the size of an economy and the size of the agency that oversees competition in it; the drop in cartel leniency applications in jurisdictions that have eased the path of follow-on damages claims; the individual spikes and dips in merger notifications within a global total fairly consistent with 2016; and the conflicts both between and within antitrust agencies on abuse of dominance, in a year that saw the European Commission issue its single biggest fine and the US Federal Trade Commission follow in the footsteps of Asian enforcers against Qualcomm.

As ever, the analysis includes tables and graphs that show how the authorities measure up next to each other in terms of size, budget, staff retention, mergers challenged, fines imposed and the length of investigations. All monetary statistics are presented in euros for comparative purposes.

Where we present staffing statistics, we refer only to the number of non-administrative, competition-focused employees, unless otherwise stated. Also, where we break down the number of staff departures into those who retired and those who remained in the civil service, our percentages are a proportion of staff departure figures, rather than a proportion of all employees. Furthermore, where we provide figures for dawn raids and for cartel decisions, we are referring to the number of separate matters, not the number of companies involved.

The remainder of the report consists of individual analyses of each competition authority's performance in 2017, supplemented by a commentary and the agency's own statement. Rating Enforcement is made possible by the cooperation of the participating enforcers, which demonstrate their commitment to transparency by disclosing their data and opening themselves to the critique of observers.

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