Antitrust by other means: Haley on form and function.

• Published date: 22 March 2009
• Author: Mehra, Salil K.
• Date: 22 March 2009

I. INTRODUCTION

To celebrate Professor John Haley's work would mean for most to consider his place in the study of Japanese law, an important place indeed. But the focus of this Essay is slightly different. Instead, it seeks to avoid giving Haley's place in antitrust short shrift in this Festschrift. In particular, Haley approached comparative antitrust law before it was actually a field. In doing so, he pioneered a way of thinking about both the form and function of enforcement that is relevant to the design of competition law regimes today.

To understand how Haley's work remains relevant, it is worth noting three important aspects of what his research did. First, he managed to articulate a conception of comparative antitrust law during a time when antitrust was often cast as a largely American show. Second, he demonstrated the importance of institutions and legal infrastructure to antitrust law, and how antitrust might function with remedies other than our own. Finally, he explicated the role of politics and political theory in providing a basis for antitrust within a society.

II. COMPARATIVE ANTITRUST IN AN ANTITRUST-SCARCE WORLD

Today, it is easy to think of competition law as subject to a near-global consensus. Since the early 1990s, the world has seen the establishment of antitrust regimes in the Eastern European transition economies, (1) Latin America, (2) China, (3) and India. (4) Additionally, during this period the European Union has established a particularly vigorous transnational competition law enforcement arm. (5) Japan, too, has taken steps to reinvigorate the often quiet Japanese Fair Trade Commission ("JFTC"). (6) Beyond these steps at the national level, there have also been recent moves, the results of which are yet unclear, to harmonize existing competition law via a number of international organizations, including the Organization for Economic Coordination and Development, the International Competition Network, and the World Trade Organization. (7) The changes at both the national and international levels represent a growing consensus on the benefits of competition law harmonization and the harms of certain practices, most notably hard-core cartels. Additionally, competition law has become trendy in the sense that nations have come to accept that having their own antitrust law is a hallmark of being a player in the world trading system.

And yet it was not always so. Indeed, quite recently, even nations that were indisputably major players in the world trading system did so with meager portions of antitrust on their development menus. As Haley pointed out in an in-depth study, a "perceived failure of enforcement was a major theme in discussion of antitrust policy in both the Federal Republic of Germany and Japan" during the 1970s. (8) As a result, it was common to conceive of antitrust law as a largely American creation; one of the most important academic lines of inquiry at the time was the degree to which the enforcement of U.S. antitrust law beyond American borders created improper tension with what were considered the legitimate interests of other nations not to enforce competition norms. (9)

In particular, Haley's was a study of how the Japanese and Germans were trying to recharge their seemingly toothless antitrust regimes. This emphasis is interesting more for its relevance to today's problems than to America's problems in the 1980s, when Haley began to write on this subject. After all, in the early 1980s, U.S. antitrust enforcement was often seen as having been overly active. As a result, during the 1970s and 1980s, the study of antitrust in American law schools focused on improving substantive rules about what conduct to punish. (10) By contrast, Haley was trying to study how nations tried to move from little or no enforcement to higher levels. Given the new antitrust regimes established since the 1990s in transition and emerging economies, this is a problem that has arguably become substantially more relevant since Haley first approached the topic.

Haley's comparison of West German and Japanese antitrust regimes to each other and to the United States remains interesting in part for what it is not. Haley avoided a direct critique of differences in the substance of antitrust law. (11) His stated principle goals were the means and degree of enforcement. (12) The aim was not to illustrate specific different, better substantive antitrust rules that might be transplanted. Rather, his work formed an attempt to explain the larger mechanics behind how these formerly occupied nations metabolized the antitrust law that America had force-fed them.

For Haley, antitrust was a vehicle for studying comparative law. His focus was "enforcement itself, not the policy being enforced--that is, whether, irrespective of the policies being enforced, differences in the sanctions used, the processes involved, and the degree or level of enforcement attained are themselves consequential factors in either promoting or restricting trade." (13) Thus, his work was not about, for example, other countries' differing treatment of resale price maintenance relative to the United States. (14) In hindsight, this is somewhat remarkable given the contemporaneous focus in the United States on substantive antitrust law, particularly the implications of law and economics on the treatment of specific antitrust violations. (15)

In this regard, Haley's work remains relevant today. In particular, when he started to focus on Japanese and German antitrust, it was not accepted wisdom that developed nations needed to have an American-style antitrust regime. As a result, Haley proceeded from a quiet assumption that antitrust was a universal impulse, at least in developed nations. (16) That said, he maintained agnosticism on the benefits of antitrust; as he put it, "[w]hether competition policies either inhibited or aided economic recovery and growth in either Japan or Germany remains contested." (17) During the 1980s in particular, policymakers sometimes faulted American antitrust law as putting American industry at a disadvantage versus their advancing foreign competitors. (18) Ironically, Haley's question of how nations with weak regimes invigorate themselves was perhaps not as timely then as it is now, as the adoption and reinvigoration...