Chinese Milk Powder Case: How Should We Interpret a Price Cut on the Announcement of an Antitrust Investigation?

(by Andreas Stephan) Earlier this month, China’s National Development and Reform Commission (NDRC) announced an investigation into foreign manufacturers of infant milk formula. The very next day, two of the firms in question did something that would be unthinkable in Europe or the US – they announced they would lower their prices and other firms have since followed. Is this the behaviour of remorseful cartelists?  Or is antitrust being used by the Chinese government in the pursuit of non-competition goals?  

The UK’s New Cartel Offence: It Could Be Alright on the Day

(by Andreas  Stephan) The Enterprise and Regulatory Reform Act 2013 drops the requirement of dishonesty and excludes cartel agreements made openly. At a late stage three additional defences were introduced (s.47 ERRA). The defendant can show they did not intend that the nature of the arrangements be hidden from either their customers or the competition authority. It will also be a defence to show that a defendant took reasonable steps to disclose the nature of the agreement to lawyers, in order to get advice, prior to its making or implementation. Writing on this blog a couple of months ago, my colleague Peter Whelan expressed concern that this defence could pose a devastating blow to the cartel offence. Here I reflect on how this defence could pan out.