October 29, 2009

It May Be Closing Time For British Beer Consumer Group’s Pub Complaint

British antitrust authorities may be telling CAMRA (the Campaign for Real Ale) that it’s closing time for its complaint charging beer prices have increased due to lack of pub competition, but the consumer group isn’t going home quietly.

CAMRA is asking Lord Mandelson, Britain’s Secretary of State for Business, to refer its complaint to the Competition Commission, following the October 22, 2009, announcement by Britain’s Office of Fair Trading (OFT) finding no significant harm to consumers despite slightly higher beer prices.

The consumer group is arguing that British consumers are being harmed by purchasing requirements that are imposed on so-called tied pubs, which are pubs operated by tenants who lease the premises, which are typically owned by a large pub management company or brewer.  The challenged purchasing requirements obligate the pub to buy most or all of its beer from the landlord or a supplier designated by the landlord.

CAMRA filed a complaint with the OFT in July 2009, charging that the pubs’ landlords use the exclusive purchase requirements to force the pubs to buy beer at higher prices than they would pay if they were free to choose their suppliers and buy directly from these suppliers. click here for more »

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Categories: International Competition Issues

    October 28, 2009

    Antitrust Foresight Brings Speedy EU Approval Of Merck’s Acquisition Of Schering-Plough

    The European Commission’s smooth approval of Merck & Co.’s $41 billion acquisition of rival Schering-Plough Corp. could be a textbook example of how parties to a merger or acquisition can get speedy clearance by anticipating – and remedying – antirust enforcers’ likely objections at the start. 

    One might have expected the union of these two heavyweights – which, if completed, will create the world’s second largest pharmaceutical company – to run into some problems with European Union antitrust authorities.  Yet, on Friday, the Commission announced that it had cleared the merger, just one month after it was formally notified of it. click here for more »

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    Categories: International Competition Issues

      October 27, 2009

      Today’s Mad Men Respect The Bing

      Several advertising powerhouses are showing some respect for the Microsoft-Yahoo! search engine deal, which would advance Microsoft’s Bing in its challenge to Google.

      As discussed in an earlier post, Yahoo! and Microsoft’s proposed partnership, which provides for Yahoo! to exit the search business and rely exclusively on Microsoft’s search engine Bing, is unlikely to be aided by traditional merger defenses in the wake of the Department of Justice’s antitrust review.  However, on October 19, 2009, the American Association of Advertising Agencies wrote a letter to the DOJ endorsing the partnership.

       The letter – also signed by leading advertising agencies Publicis Groupe, WPP, Interpublic Group, and Omnicom – states that a “healthy, competitive market for search and search advertising is crucial to the Internet’s future,” and that “Yahoo! and Microsoft’s proposal to combine their technologies and search platforms is good for advertisers, marketing services agencies, website publishers and consumers.”  The letter opines that the partnership “enhances competition,” and urges the DOJ to conclude its review quickly so that the partnership can take effect as soon as possible.

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      Categories: Antitrust Enforcement

        October 26, 2009

        The Predatory Pricing – Booksellers Charge It’s Not A Work Of Fiction

        What do Sarah Palin and Stephen King have in common?

        The answer is not a punchline to a bad joke, it’s that both have books that are selling at 1950s prices, which a group of booksellers view as predatory and worthy of investigation by the U.S. Department of Justice.

        The American Booksellers Association (ABA), a 109-year-old trade organization representing the nation’s locally owned independent booksellers, wrote a letter last week to the DOJ urging it to investigate the price war between Amazon.com, Walmart.com and Target.com, and requesting a meeting with officials as soon as possible.  As was widely reported, the three online retail giants began selling new hardcover bestsellers, including books from Stephen King, Sarah Palin, Barbara Kingsolver, John Grisham, and James Patterson, for between $8.98 and $9.00.

        The booksellers allege that the retailers are selling the books at predatory prices – below cost – as loss leaders to attract shoppers who then purchase more costly items. click here for more »

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        Categories: Antitrust and Price Fixing

          October 23, 2009

          Senator Hatch Kicks The Antitrust Football To President Obama

          While it might be unlikely that President Obama and Republican Senator Orrin Hatch of Utah will be getting together for some Bud Lights and Doritos at a Super Bowl party, they may still become football friends over the antitrust issues raised by the Bowl Championship Series.

          Senator Hatch sent President Obama a 10-page letter on Wednesday asking him to investigate the BCS for possible antitrust violations in the way college football picks its national champion.

          The issue is personal for Senator Hatch’s constituents.  Although Utah was the only undefeated team in the Football Bowl Subdivision last year, they did not get a chance to play for the national title.

          President Obama has already picked his team in the College Football Playoff Debate.  On 60 Minutes last year, in his first interview as President-Elect, Obama expressed support for a college football playoff system instead of the present bowl system based on rankings.

          Senator Hatch contends that the BCS results and placement in college bowl games at the end of the season is rigged in favor of “privileged” conferences, to the exclusion of smaller ones that include universities in his home state of Utah.  “After a careful examination of both the written and oral testimonies presented” to his committee, Senator Hatch wrote to President Obama, “I believe a strong case can be made that the BCS is in violation of the Sherman Antitrust Act.  Therefore, I respectfully request that the Department of Justice’s Antitrust Division look into this matter.”  click here for more »

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          Categories: Antitrust Enforcement

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