While cooperations between competing undertakings stay under heavy scrutiny, there seems to be a trend of regulators cooperating cross-border. Those cooperations often concern (a growing number of) topics that are perceived to be wider than national, and that regulators might think can only be properly tackled together. Here is a rundown of fora which have been particularly active lately and/or should be paid close attention to going forward.
Regulatory cooperation is of course nothing new or unwelcome. In particular in difficult merger cases, regulators are often in touch with each other to align timelines and views. More often than not this is also in the interest of the parties, because it lowers the risk of diverging views on the same issues and increases predictability. But the fora in which (antitrust) regulators cooperate today go beyond merger control issues.
The obvious ones: ICN and ECN
The International Competition Network (ICN) is a
association network of global antitrust regulators, including 140 of them. The latest news from the ICN was the suspension of the Russian regulator following the events in Ukraine (the OECD followed suit later, including a suspension from the OECD’s Competition Committee). On substance, the ICN is this week – being traditional – focussing on merger control in a workshop hosted by the Brazilian regulator CADE.
The European Competition Network (ECN) is the ICN’s equivalent for Europe. While only made up of antitrust regulators from the EU, the situation in Ukraine did not bypass the ECN. In a joint statement, the ECN confirmed that “it” (apparently meaning its member regulators) will “not actively intervene against strictly necessary and temporary measures specifically targeted at avoiding […] severe disruptions caused by the impact of the war and/or of sanctions in the Internal Market”.
The global trend: Foreign investment control
Foreign investment control is on top of the agenda of regulators and parties to M&A deals alike. The US with its screening regime is sometimes considered the “motherland” of foreign investment control. So, in September last year, the European Union and the US teamed up also in this regard. They formed the so-called “Trade and Technology Council” (TTC), comprising of ten working groups. One of them deals with investment screening, and the TTC’s inaugural statement contains a whole (yet short) annex on the topic.
In a speech to the European Parliament last week, the European Commission’s Executive Vice President for Trade Valdis Dombrovskis talked about “good progress” in the discussions on investment screening, and confirmed that the EU and US wanted to “see how to expand our cooperation”.
The one we already blogged about: Supply chains
A little more than a month ago, we wrote about how antitrust regulators from Australia, New Zealand, the UK and the US formed a working group focussed on sharing information to identify and prevent potentially anticompetitive conduct in the global supply and distribution of goods. Regulators outside the “Five Eyes” countries were not part of the initiative, even though both the German and French regulators said they also had supply chains on their radar.
Whatever will come out of it, the cooperation here is another example of how regulators are willing to react quickly to live issues and team up to do so.
The good, the bad and the ugly: Pharma
Mergers again: Antitrust regulators from Canada, the UK, the US and the European Commission launched a working group to “exchange best practices on pharmaceutical mergers” about a year ago. Pharma transactions are often heavily scrutinized and regularly touch on “trendy” antitrust topics like R&D, innovation and killer acquisitions. So, the formation of the working group was observed with
a certain tension interest by some stakeholders. As far as one can tell, it has brought no massive changes so far. But given how long complex merger control proceedings take and the time required for ideas and approaches to trickle down, the working group should by no means be discounted.
In these times, cross-border cooperation between regulators really is one the rise. In that sense, the above is just a glance at cooperations. For example, the EU and China also have a standing forum and just held the “23rd EU-China Competition Week”.
Generally, cross-border cooperation should be welcomed. It works best when the results of discussions are made known to the public, so that stakeholders know the lines of regulators’ thinking, and can prepare and act accordingly. I.e., cooperation should not just take place behind closed doors. Involved regulators should (continue) to be open about it.