In an increasingly globalised world, competition authorities are having to strengthen their collaboration skills and work together to successfully promote fair competition and consumer interest.
Cross-border enforcement across all industries comes with a set of fairly predictable challenges, both legal (extra-territorial jurisdiction issues, disparities in legal frameworks) and logistical (procedural differences, as well as the many complications caused by coordinating delicate investigations across multiple continents, languages and time zones).
Cross-border competition enforcement has an added layer of complexity, however, in that a lot of what competition authorities are trying to investigate is obscure and secretive by its very nature.
In 2004 the European Commission noted that, where there is illegal collusion, secret meetings often take place in an unrelated country and, although this is not a new layer of complexity, it is one that is becoming harder to navigate as global connections grow.[1] As the Court of Appeal commented in its recent judgment in CMA v BMW and VW, "Cartels are, characteristically, covert and ever more international".[2]
With competition concerns, it is not only the growth of transnational corporations that means that cross-border enforcement is becoming more and more essential. By spreading anti-competitive bad behaviour across international borders, infringers are using geography to further conceal their tracks and avoid punishment.
But we are seeing regulators continue to embrace the challenge, strengthening their global relationships and further committing to pooling information and resources to operate efficient and effective investigations, despite the many obstacles.
For example, in 2020, competition authorities in Australia, Canada, New Zealand, the US and the UK signed the Multilateral Mutual Assistance and Cooperation Framework for Competition Authorities (MMAC) establishing a solid basis for collaboration agreements going forwards.[3] Likewise, the UK’s Trade and Cooperation Agreement with the EU (made after Brexit) contains clear provisions demonstrating both parties’ understanding of the importance of maintaining teamwork and coordination within competition regulation.[4]
In 2023, the European Commission twice conducted unannounced inspections in collaboration with other authorities across jurisdictions – once to investigate fragrance companies (along with the US Department of Justice, the UK Competition and Markets Authority and the Swiss Competition Commission) and once to investigate construction chemicals companies (along with the UK Competition and Markets Authority and the Turkish Competition Authority).
And in an environment where the element of surprise is valuable, the ability to carry out dawn raids and push investigations forwards simultaneously across jurisdictions is undeniably an asset.
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We hope you've found this article of interest.
If you'd like to discuss it, or any other matters where we may be able to assist you, please contact David Rankin on david.rankin@puntersouthallgroup.com.
[1] eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:62000CJ0204
[2] Final_Judgment_-_CMA_v_VW___BMW.pdf (publishing.service.gov.uk)
[3] Antitrust Division | Continued Commitment to International Enforcement (justice.gov)
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