Competition Law

Australian Competition Law and Policy Discussion

US DOJ – ‘Vigorous Antitrust Enforcement in this Challenging Era’

Posted by Julie Clarke on 13 May 2009

Following her withdrawal of the single firm conduct report, Christine Varney (Assistant AG, Antitrust Division, DOJ), yesterday made a speech entitled ‘Vigorous Antitrust Enforcement in this Challenging Era‘.  The speech, in part, draws from historical examples of economic distress and concludes that there are two key lessons to learn:

‘First, there is no adequate substitute for a competitive market, particularly during times of economic distress. Second, vigorous antitrust enforcement must play a significant role in the Government’s response to economic crises to ensure that markets remain competitive.’

She goes on to criticise the theory, which has dominated antitrust enforcement in the US in the last decade, that markets will ‘self-police’ and ‘self-correct’, observing that this self-correction has not occurred and instead we see ‘numerous markets distorted’.  She states that the DOJ will take a much greater enforcement role in the future, particularly by ensuring vigorous enforcement action under Section 2 of the Sherman Act as part of the Antitrust Divisions response to the current market conditions.  Although most of the speech is devoted to Section 2, Varney notes that continued ‘criminal and civil enforcement under Section 1 of the Sherman Act will also be an important part of the Antitrust Division’s response to the distressed economy’.  She also notes the need for increased cooperation between the DOJ(AD) and the FTC and the need to maintain cooperation with foreign antitrust agencies.

Varney concludes by saying that: ‘Antitrust must be among the frontline issues in the Government’s broader response to the distressed conomy.  Antitrust authorities … will therefore need to be prepared to take action.  The Antitrust Division will be ready to take a lead role in this effort.’

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