A review of the third report of the Monopolies Commission of West Germany

• DOI: 10.1177/0003603X8302800306
• Author: Hans Otto Lenel
• Date: 01 September 1983
• Published date: 01 September 1983
• Subject Matter: Article

The Antitrust Bulletin/Fall 1983

A review

of

the third report

of

the Monopolies Commission

of

West Germany

BY HANS OTTO LENEL *

757

I. Status and development

of

concentration in West Ger-

many since 1972

In the third report

of

the West German Monopolies Commission,

entitled "Merger Control Remains of High Priority," Ian intro-

ductory summary is followed by two chapters on the status and

development of enterprise concentration, which altogether ac-

Professor Emeritus, Johannes Gutenberg University.

AUTHOR'S

NOTE: This article was translated by Professor Emilio Roxin,

University

of

Rhode Island.

IMonopolkommission, Dritte Hauptgutachten 1978/1979, Fu-

sionkontrolle bleipt vorrangig (Baden-Baden: Nomos Verlagsgesell-

schaft, 1980). Under the Law Against Competitive Restraints [Gesetz

gegen Wettbewerbsbeschrankungen], the German Monopolies Commis-

sion is required to report every two years on current trends in concentra-

tion in the economy. In addition, the Commission, which is independent

of the Cartel Office, reviews developments in the enforcement

of

those

sections

of

the law that deal with the abuse

of

dominant positions and

with mergers.

©1984by Federal Legal Publications, Inc.

758 : The antitrust bulletin

count for almost half of the whole volume (199 double-column

pages without the appendix). Chapter 1 analyzes the extent

of

market concentration in the different branches

of

German in-

dustry.

It

begins with a review

of

the Commission's statistical

program on concentration, although this new program will be

implemented for the first time in the next report. Chapter 1 also

discusses analytical problems arising from the use

of

currently

available statistical data. These data have not been satisfactory, as

they are not sufficiently subdivided. Enterprises are routinely

tabulated only as legal units. Hence the interrelationships of the

various financial groups are left out

of

consideration. Industrial

enterprises manufacturing several products are tabulated in that

industrial branch where they realize the largest proportion

of

their sales.

For

example, an industrial firm manufacturing leather

and products

of

leather and plastics will appear only in the

four-digit plastics branch if plastic products account for its largest

single percentage of sales. This predominant percentage can

change.

Once the statistical reporting reform is carried out, an index

file will be set up for all enterprises in mining, manufacturing,

energy production, and construction. All the data relevant to

each firm will be recorded in these files.

If

a firm has several

plants, the

data

pertaining to each of them will also be recorded.

Concentration coefficients will be calculated for both enterprises

and plants. The different degrees of vertical integration will be

expressed by comparing the amount

of

sales with the value

added. The analysis

of

conglomerate concentration will be im-

proved by determining the percentage of sales in the firm's main

line

of

business to its total sales, and by giving the total number

of

different lines of business (p. 34 and following). Unfortu-

nately, enterprises will still be considered only in the sense

of

legal

units. Moreover, there will be no change in

data

collection

procedures for trade, banking, and insurance, which do not

permit calculation of meaningful concentration statistics.

Industry groups (for example, machinery) are classified under

two-digit

numbers-"two-digit"

industries, according to the ter-

minology

of

the Commission. There is a total

of

33 such two-digit