A new Russian retail trade law is scheduled to (at least partially) go into effect on February 1st.  The new retail trade law, with the support of the national antitrust authority and Prime Minister Putin amongst others, has three essential features: (1) limiting the operation of chains to no more than 25 percent of total sales within particular geographic regions, i.e. prohibition on internal expansion or merger, (2) restrictions on the ability of suppliers and retailers to enter into slotting arrangements and other payments for shelf space, and (3) price controls on some subset of “socially-important” goods.

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Simon Johnson is at it again, advocating the use of antitrust to break up the banks because they are, you know, big, and antitrust is about busting up big companies, right?

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As regular readers know, we’ve been following with (critical) interest the antitrust issues surrounding the seed industry in general and Monsanto in particular.  See, for example posts by me or Mike here, here and here.

Read the full piece here. 

When I first read Josh’s post of antitrust links below, I thought “Drew Brees? Surely not THAT Drew Brees.”  Turns out, it IS that Drew Brees. I was very interested to read the QB’s take on American Needle and his plead for the Supreme Court to reject the NFL’s petition to be deemed “a single entity.”  However, of even more interest to me was Brees’ comment that the NFL is petitioning for a “single entity” designation that would, according to Brees, apply “for pretty much everything the league does.”

Read the full piece here.

Yesterday, in my contribution to the Antitrust & Competition Policy Blog’s Section 5 symposium, I discussed the FTC’s use of Section 5 to evade the tough standards facing plaintiffs bringing Section 2 claims and how that evasion was likely to cost consumers by stripping out the error-cost protections embedded in modern monopolization law.  I also argued that the Commission’s various justifications for bringing the case under Section 5 were both unpersuasive and unprincipled.  Some of the justifications are to do with the general trend towards favoring Section 5 as a stand alone authority, others rely on the institutional expertise of the Commission relative to judges in federal district court, and still others on the nature of competition in the microprocessor market, e.g. Commissioner Rosch’s claim that the difficulty in distinguishing harm to competitors from harm to competition in this setting supports a Section 5 case.

Read the full piece here.

The FTC should be ashamed

Seriously.  What interpretation of events is there other than that the FTC knew it could not prevail in a Section 2 case and decided to go in search of a back-up?  Commissioners Rosch and Leibowitz have been making noise about Section 5 for some time, and this seemed like the perfect opportunity to put it to the test—to make some new law that would favor the Commission in cases like this one where it “knows” there is injury but the Section 2 case law makes prevailing difficult nonetheless.  They have “found” their case, and Intel, its shareholders, consumers and competition generally will suffer mightily for their hubris.

Read the full piece here.

Employing Section 5 of the Federal Trade Commission Act to evade Section 2 monopolization law is not a legitimate use of Section 5.  This is, unfortunately, the only reasonable interpretation of the Commission’s choice to make Section 5 the primary hook of its Intel complaint.  While there is no doubt that Section 5 of the FTC Act was intended to allow the Commission to fill “gaps” in antitrust enforcement under the Sherman Act, the FTC’s attempts to pigeonhole its Section 5 complaint into this “gap” filling rationale is not persuasive.

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Economist, co-author, and sometimes TOTM guest David Evans (UCL, University of Chicago School of Law) has an excellent note on “Why Now is Not the Right Time To Revamp Consumer Protection,” based on remarks made at the New York Federal Reserve Board-New York University Conference on Regulating Consumer Financial Products yesterday in New York.  Evans makes some of the points we discuss in our joint work criticizing the intellectual basis for the Consumer Financial Protection Agency, but also offers a concise and powerful case against “revamping” consumer protection too hastily, or without attention to the institutional details or the economic evidence.  Geoff’s post the other day on credit card regulation, for example, points out precisely the types of harmful errors that can be made on “behalf” of consumers when invoking the behavioral economics literature without analyzing it (or the related empirical evidence) closely. Evans makes six essential points — and I’m excerpting here — but I suggest readers check out the whole thing…

Read the full piece here. 

A couple weeks ago, Geoff wrote concerning the DOJ’s misguided antitrust interest in Monsanto. With that in mind, I was very interested to see today’s announcement that Monsanto’s earnings and gross margins are significantly off for its fiscal first quarter.  According to the Wall Street Journal report, Monsanto posted a loss for the quarter due to a 36% drop in sales and lower margins resulting from price decreases.  Leading the drop, sales of the company’s Roundup and other herbicide products tumbled 63%!

Read the full piece here.