Can Developing Economies Benefit from WTO negotiations on Binding Disciplines for Hard Core Cartels?
Type
work report
Date Issued
2003
Editor(s)
Abstract
At the next WTO Ministerial Conference, to be held in Cancún 10-14 September 2003, Ministers will decide by explicit consensus on modalities of negotiations on competition issues. In addition to the decision on whether to proceed with negotiations, an agreement will have to be reached on what type of provisions should be included in a multilateral framework on competition, and of particular interest here is the desirability of including possible provisions on so-called hard core cartels.
Many developing countries have actively participated in discussions on competition-policy-related matters in the WTO and they can be expected to play a full part in the deliberations in Cancún . This paper assesses the potential costs and benefits of negotiations on potential provisions for hard core cartels for developing economies and begins by reviewing the factual record in this regard.
Estimates are presented here on the likely damage done to developing countries by the 40 or more private international cartels that were prosecuted by government agencies in the industrial economies in the 1990s. In the case of the international vitamins cartel, which was worldwide in scope and lasted 10 years, there is robust evidence that cartel members targeted those jurisdictions with little or no cartel enforcement for greater price rises and larger overcharges to customers. This evidence, as well as other evidence, raises the question of what measures, if any, are being taken to protect developing economies' interests against this form of international anti-competitive practice.
Many developing countries have actively participated in discussions on competition-policy-related matters in the WTO and they can be expected to play a full part in the deliberations in Cancún . This paper assesses the potential costs and benefits of negotiations on potential provisions for hard core cartels for developing economies and begins by reviewing the factual record in this regard.
Estimates are presented here on the likely damage done to developing countries by the 40 or more private international cartels that were prosecuted by government agencies in the industrial economies in the 1990s. In the case of the international vitamins cartel, which was worldwide in scope and lasted 10 years, there is robust evidence that cartel members targeted those jurisdictions with little or no cartel enforcement for greater price rises and larger overcharges to customers. This evidence, as well as other evidence, raises the question of what measures, if any, are being taken to protect developing economies' interests against this form of international anti-competitive practice.
Language
English
Keywords
developing countries
cartels
HSG Classification
not classified
Refereed
No
Publisher
UNCTAD
Subject(s)
Eprints ID
22165
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Name
evenett.pdf
Size
1.4 MB
Format
Adobe PDF
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