Abstract. This paper provides a comparative overview of EU and US Antitrust approaches to monopolies. Many scholars see the two leading antitrust regimes as completely different, explaining that US antitrust law prioritizes the protection of the competitive market process while EU law focuses on the consumer at the expense of dynamic competition. The intention here is to argue the exact opposite, to suggest that in reality the two systems are not so different and, moreover, that they are getting closer.
A. Major Issues regarding Monopolization
Big business and consumers have always had a “love-hate relationship”. There are several reasons why large companies are so popular: they employ more people, pay them higher salaries, create most of the products we use, do most of the research and development, pay many of the taxes etc. On the other hand, they are also seen as huge companies crowding new businesses out of the market. Eleanor Fox’s comparison of those businesses with the “Big Bad Wolf” is a very good illustration of this public feeling. In her article, she explains how the “little entrepreneur walking in the forest with a bag of new inventions-designed-to-shake-up-the-world” got eaten by the “Big Bad Wolf”. The latter explains that if he had a duty to him, the law would undermine his incentives to invest and invent, and society would lose. The fable ends with the wolf pouncing on Little Entrepreneur’s bag of inventions, and using everything in it, leading everyone to proclaim that Big Bad Wolf has become yet more efficient .
From a legal point of view, why are monopolies considered harmful? The main problem with a monopoly is that the dominant firm is able to set a higher price than marginal cost. The explanation is quite straightforward: if a firm is in a dominant position, it can act as a price maker and therefore fix a price which is higher than the competitive one − the monopoly price. Most of the time, the dominant firm maintains its position by using some kind of predatory conduct in order to deter competitors, as opposed to strategic conduct which is aimed to improve the firm’s market position. There is clearly a loss for consumers here, who will have a narrower choice and will probably pay higher prices. However, we will see in this paper that the consumer is increasingly the focus of antitrust policies.
Another important problem with a firm in a dominant position is that it does not face the discipline of competition. Indeed, the dominant firm may operate inefficiently without running the risk or the pressure of being corrected by the market. Thereby, this discourages healthy market competition, with all the consequences that go with it (less innovation for example).
It is frequently asserted that the United States (US) and European Union (EU) legal solutions to monopolies are completely different, that the two antitrust systems have very different aims .The existing literature devotes little attention to current convergence observable in the way the two systems are evolving, especially on the monopolization issue. Confounding norms and enforcement, many claim that the two systems are at opposite ends of the spectrum. In this paper I shall argue that on the contrary, their standards are extremely similar and in fact enforcement policies are converging.
B.Overview of the Law governing monopolization
(i) The Sherman Act of 1890
The Sherman Act was originally enacted to be an answer to wrongful conduct and abuse by dominant firms. It is a blend of two very important concepts: restraint of trade (Section 1) and monopoly (Section 2). It is Section 2 that interests us particularly here. According to this provision, “every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony.” Today, “monopolization” refers to a number of activities that may be illegal when performed in a properly defined relevant market.
(ii) Article 102 TFEU (ex. Article 82 EC)
The Lisbon Treaty came into force within the European Union (EU) on December 1st 2009, changing the numbering of the Articles related to the single market and competition. However, the change from Article 82 to Article 102 did not change the wording of the provision. According to Article 102 TFEU, “any abuse by one or more undertakings of a dominant position within the internal market or a substantial part of it shall be prohibited as incompatible with the internal market in so far as it may affect trade between Member States.” It is clear from this provision that two separate elements have to be established in order to characterize a violation of article 102 TFEU: “a dominant position” and “abuse”.
2. Very Similar Constitutive Elements
We will see in this section how the US and EU Antitrust systems both apply the same standards in order to characterize the existence of a monopoly. First, the firm must have some monopoly power in order to secure its dominant position (A). Second, that firm must have gained and maintained that position with some kind of abusive conduct (B).
A. The notion of monopoly power in monopolization
The definition of monopoly power is a crucial question in the European and American systems because there cannot be an unlawful monopoly without monopoly power. Surprisingly perhaps, neither Article 102 TFEU nor Section 2 of the Sherman Act provide a precise definition of what constitutes monopoly power.
The European Courts, in the well-known United Brands and Hoffmann-Laroche decisions of 1978 and 1979 defined monopoly power (or domination) as “a position of economic strength enjoyed by an undertaking that enables it to prevent effective competition […] on the relevant market by giving it the power to an appreciable extent independently of its competitors, customers […] and consumers.”  In other words, in order to determine if there is a dominant position, there must be a study of the extent competitive pressure .
In the USA, the definition is provided by the du Pont (cellophane) case (1956), where the Supreme Court defined monopoly power as “the power to control prices or exclude competition” .Thereby, a firm is a monopolist if it can profitably raise prices substantially above the competitive level .Certainly, the Supreme Court’s definition is much broader than the European one, but there is clearly the same idea of competitive pressure: if a company has the power to control prices or exclude competition, it has the power to exert competitive pressure.
(ii) Evaluating market power
The question of evaluating or proving monopoly power is closely linked to the notion of market power: in order to see if there is a dominant position, there must be some market power to illustrate it. Indeed, in its 2009 guidance paper on article 102 TFEU, the European Commission explicitly linked the concept of dominant position with market power, explaining that a dominant position is present when there is market power .Evaluating that market power can be difficult and it remains an important source of debate between economists, scholars and the Courts. However, after studying case law, antitrust authorities’ decisions and guidance papers on both Article 102 and Section 2 of the Sherman Act, it appears that the market share test is the most popular and straightforward test of market power in a relevant market.
(1). The predominance of the market share test
Although it is not the only element that needs to be examined, the most significant structural indication of market power is, without doubt, the firm’s market share .The Courts in both systems have used the market share test in order to determine if a company is monopolizing. After analyzing their case law, it appears that there are three different indicators of market share that can reveal whether or not the company occupies a dominant position in a defined relevant market.
First, there is an agreed threshold under which a monopoly is rarely considered to exist. For the US courts, it is approximately 70 per cent and according to the European Commission’s Guidance Paper, a company will not be likely to have a dominant position when its market share is under 40 per cent .Indeed, the lowest market share ever upheld was in the Virgin/British Airways decision, where the Commission concluded that a dominant position existed with a market share of 39.7 per cent .
Second, there is a strong presumption of a monopoly when the market share reaches a certain level. According to the Akzo case, in the EU there is a such a presumption when the firm has a market share of 50 per cent or more .As for the situation in the United States, a Report published by the antitrust enforcement agency at the Department of Justice argued, with regard to Section 2 of the Sherman Act, that a “rebuttable presumption” of market power existed where market share exceeds 66 per cent .
In some cases, the market share alone is sufficient to demonstrate the existence of a monopoly. For example, in the Alcoa case, Judge Hand clearly indicated that a market share of 90 per cent was sufficient and in Hoffmann La-Roche the European Court of Justice ruled that a 75 per cent market share was clear proof a dominant position .The European Court went even further in Hilti and ruled that “very large shares must be considered in themselves […] as evidence of a dominant position. Such is the case with a market share of 70 per cent and 80 per cent.” 
We see here how the two systems are close; they both have the same “hierarchy” of market shares with a three-level test. However, the European Courts and Commission seem to require a lower threshold, making it easier to characterize a dominant position. This is not very surprising, since, as we shall see later in this paper, the whole public enforcement system in Europe has traditionally been much stricter than in the USA.
Finally, it is really important to note that the courts also look at the competitors’ market shares. The lower their market share, the more likely the judge will conclude that the company is in a monopoly position .Furthermore, for the Courts, only stable and long-lasting market shares are relevant for the assessment of the existence of a monopoly.
We will not focus here on the question of market definition which does not appear very relevant to this study .We can just underline that the US Courts have relied on a direct effects doctrine introduced in Indiana Federation of Dentists, which ruled that “the finding of actual, sustained adverse effects on competition […] is legally sufficient to support a finding that the challenged restraint was unreasonable even in the absence of elaborate market analysis.” 
(2). Barriers to market entry
Competition is a dynamic process and in order to evaluate market power, it is important not to confine attention to the existing competitive situation. If other firms can enter a market or rivals can expand, a firm will not be able to maintain market power in the long run; hence its markets power will not be durable .That is why courts also rely on several structural factors in order to evaluate market power.
While it is true that US courts in monopolization cases “have not always taken ease of entry as seriously as they should”, several commentators have noted that when entry is easy, it has usually been considered that the defendant lacked substantial market power .
It was the Hoffmann-La Roche case that first made a reference to this idea of barriers to entry in the European system. The court ruled that dominance could be established where competitors with smaller market shares than the leading undertaking were not “able to meet rapidly the demand from those who could like to break away from the undertaking which has the largest market share.” 
In recent decades, courts have defined several different barriers to entry. For example, an historical advantage given by a US state legislation can be seen as a barrier to entry .Financial and technological resources are another way of deterring entrance into a specific market . A last example of barrier to entry could be intellectual property (IP) rights. This last case is an important source of debate in both systems because a patent, for example, may be a barrier to entry if it controls the only available technology but at the same time is protected by a lawful title of property. The European Courts have held in numerous cases, such as United Brands, Hilti and TetraPak II that IP rights constitute an entry barrier . The US courts are a little more reticent to take this path, but the FTC has repeatedly challenged them on this issue, and in some cases such as US v. Microsoft, that perseverance seems to have paid off .This whole question of IP rights is still a very sensitive one because there is clearly a conflict between two objectives: encouraging innovation with legal protection (application of IP law) and deterring anticompetitive behaviors in the interest of the consumers (application of antitrust law). The law has to find here a delicate balance between the two in order to fulfill both objectives.
Finally, it is striking that there appears to be a certain confusion between barriers to entry and conduct in both systems. While in the US, barriers to entry are also a part of the conduct test (in the Aluminum case for example), in the EU antitrust system, anticompetitive conduct is one kind of barrier that can help characterize market power (United Brand) .This is clear proof that the line between the two steps involved in demonstrating the existence of a monopoly is blurred.
B. The notion of abuse/conduct in monopolization
(i) Why do we need monopolizing behavior?
The two systems require monopoly power plus some sort of anticompetitive conduct. In other words, the firm in the dominant position must have gained this advantage by means of unlawful practices. In the 1980s, there was an important debate about abolishing the conduct requirement following Professor Flynn’s statement urging the National Commission for the Review of Antitrust Laws and Procedures to consider recommending that Congress amend Section 2 of the Sherman Act to permit the government to challenge monopolies without having to show that the monopoly was acquired or maintained through anticompetitive conduct . The National Commission concluded that proof of bad conduct was simply not central to the monopolizing problem and therefore concluded that a no-conduct monopolization approach would “represent a logical solution” . The Commission’s view was that substantial, persistent monopoly power is undesirable and abolishing the conduct requirement would enhance the effectiveness of antitrust enforcement . However, Section 2 was never amended; the idea that it is vital to prove that monopoly power was acquired or maintained through conduct prevailed.
This requirement is central because if all monopolies were unlawful just because of the firm’s market power, this would mean that antitrust law punishes firms that innovate. As Professor Hovenkamp points out, “firms innovate because they expect their successes to produce economic returns, eventually the high profits will attract other producers into the market and collectively these producers will increase output and prices will be driven to the competitive level.” If antitrust law condemned monopolization in general, innovation would be severely compromised, and this would clearly be a great loss for the consumer and the economy in general. As the CJEC explained in Akzo,
The Commission emphasizes that it does not consider an intention even by a dominant firm to prevail over its rivals as unlawful. A dominant firm is entitled to compete on the merits. Nor does the Commission suggest that large producers should be under an obligation to refrain from competing vigorously with smaller competitors or new entrants .
The necessity to define the notion of abusive conduct is linked to the idea of a protecting “no-fault monopolies”, which means that a monopolist’s use of superior business skill to maintain monopoly power should not be considered in itself improper . Therefore, defining and identifying “conduct” is very important in order to distinguish aggressive competition and anticompetitive conduct .
(ii) General definition
The definition of the second constitutive element of monopoly also offers proof of how the two antitrust systems resemble each other: the EU and US Courts have adopted a very similar approach concerning the definition of what constitutes abusive conduct, in the absence of legislative guidance. The concept of the dominant firms’ responsibility is at the heart of the conduct requirement. This idea was clearly expressed by the EU Courts in Michelin:
It is not possible to uphold the objections made against those arguments by Michelin NV, supported on this point by the French Government, that Michelin NV is thus penalized for the quality of its products and services. A finding that an undertaking has a dominant is not in itself a recrimination but simply means that, irrespective of the reasons for which it has such a dominant position, the undertaking concerned has a special responsibility not to allow its conduct to impair genuine undistorted competition on the common market .
The US Supreme Court in US v. Griffith took a very similar view . The fact that dominant firms have a responsibility towards competition is a key element in the application of article 102 TFEU and Section 2 of the Sherman Act because it imposes a positive duty on monopolizing firms .It is also important to note that there is no need for an intent in order to invoke this responsibility. This was made clear by both Courts in the BPB Ind. & British Gypsum and in the Alcoa cases .
Concerning the substantive definition of exclusionary conduct, it was clearly defined in the Grinnell case as the “willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident” .Subsequent case law has made it very clear that Section 2 condemns only “exclusionary” conduct and does not punish monopolies acquired or maintained through superior skill, foresight, or industry .
In Europe, the concept of abuse has not been precisely defined by the courts but the ECJ has generally adopted the approach to abuse outlined in the Hoffmann-La Roche case:
The concept of abuse is an objective concept relating to the behavior of an undertaking in a dominant position which is such as to influence the structure of a market where, as a result of the very presence of the undertaking in question, the degree of competition is weakened and which, through recourse to methods different from those which condition normal competition in products or services on the basis of the transactions of commercial operators, has the effect of hindering the maintenance of the degree of competition still existing in the market or the growth of that competition .
The European Commission’s own view on the meaning of the concept of abuse is that it refers to anti-competitive business behavior of a dominant firm which is intended to maintain or increase its position .In its Guidance papers on Article 102, the Commission provides further information on abuse and really links it with exclusionary conduct, in a way that recalls the US approach:
(Article 102) prohibits exclusionary conduct which produces actual or likely anticompetitive effects in the market and which can harm consumers in a direct or indirect way .
(iii) Identifying the conduct requirement
In the USA, there is still an important debate over which “test” should be used in order to identify exclusionary conduct. The Supreme Court in Aspen came close to establishing a general test . According to the court, “exclusionary conduct” comprehends behavior that tends to impair the opportunity of rivals but also either does not further competition on the merits or does so in an unnecessarily restrictive way. However, several commentators have expressed their dissatisfaction at what they consider the lack of clarity in this definition, and the Court’s failure to educe an effective legal test in in its subsequent decisions has not helped matters .
The D.C. Circuit in the Microsoft case proposed a rule of reason test, similar to the one used under Section 1, which has been welcomed by many legal commentators. First the Plaintiff “must demonstrate that the monopolist’s conduct indeed has the requisite anticompetitive effect” which “harms the competitive process and thereby harms consumers”. Second, the defendant may counter by offering a procompetitive justification. Third, “if the monopolist’s procompetitive justification stands unrebutted, then the plaintiff must demonstrate that the anticompetitive harm of the conduct outweighs the procompetitive benefit” .
The European view on the identification of abuse under Article 102 TFEU seems to be very close to the test used in Microsoft by the D.C Circuit. Indeed, for some time European courts have been using a kind of “proportionality” analysis very close to the rule of reason. The identification of a case of abuse requires evidence of four elements: (1) exclusionary conduct, (2) actual or potential effect on competition (3) absence of objective justification and (4) prejudice to consumers .The similarity between the US and the US tests is clear here; the only difference being the wording. Moreover, it is very interesting to observe how the two systems concentrate on the consumer, with pride of place given to the impact of exclusionary conduct on him or her, not the effect on competition (even though that the two are necessarily linked).
It is important to remember in this context that under EU law, there are two categories of abuse: exploitative abuse and exclusionary abuse. We have only focused on the second category because US antitrust law does not sanction exploitative conduct and because it occupies a smaller part of EU litigation.
Finally, it is worth noting that there is a striking parallel between EU and US competition law regarding collective dominance. The American Tobacco suit marked the start of the antitrust fight against oligopoly in the US . In this case, the three leading cigarette manufacturers were alleged to have violated Section 2, even though none of them had an individual position of monopoly power. The idea of collective dominance emerged later in the EU, certainly under the influence of the US Antitrust legislation, with the “flat glass” case .
C. Illustration: the case of Microsoft litigation
The Microsoft litigation is a key case in comparing US and EU approaches to monopolies and it is striking to find that the constitutive elements of monopolization were applied in a very similar way. First, concerning market power, the US Court of Appeals found that the district court was correct in finding that Microsoft had a 95 per cent share of the market (the relevant market being Intel-compatible PC operating systems), and its position was protected by substantial entry barrier . This “applications barrier to entry” was calculated on the basis of two characteristics of the software market: most consumers prefer operating systems for which a large number of applications have already been written; and most developers prefer to write for operating systems that already have a substantial consumer base . In the European Commission’s decision, the reasoning was very similar with first a reference to the market share and then to barriers of entry: “the dominant position is characterized by market shares that have remained very high at least since 1996 (90 % + in recent years), and by the presence of very high barriers to entry.”  The Commission even made a reference to the “applications barrier to entry” used in the US Antitrust case in order to explain what this barrier was, providing an explanation very close to that of the US Court of Appeals. It is important to note here that all the Commission’s findings on market power were confirmed by the Court of First Instance in its decision of 2007 .
Second, concerning conduct, as we saw earlier in this paper, to be condemned as exclusionary, a dominant firm’s conduct must have an anticompetitive effect. However, the monopolist may offer a procompetitive justification for its conduct, and if it does so, the burden of proof shifts back to the plaintiff. The Appellate Court found that Microsoft’s anticompetitive exclusionary conduct was characterized by its numerous agreements with hardware manufacturers, internet access providers, software manufacturers, etc. The integration of Internet Explorer in Windows and its efforts to contain and subvert Java technologies were also factors taken into account in order to prove the company’s exclusionary conduct. In the European decision, the Commission’s definition of Microsoft’s abuse of its dominant position was based on two factors: the tying of Windows Media Player with Microsoft Windows OS and the refusal to supply the server market which led to the elimination of competition. While it is true that the EU and the United States apply the same substantive standards, differences in the procedure become apparent when investigations and agency decision-making procedures are examined.
3. Contrasting Approaches on Enforcement
A. Two apparently different systems
(i) Public enforcement
Although the EU and United States apply the same substantive standards, differences in procedures can be observed when it comes to investigation and agency decision-making. In EU Antitrust system, it is the Walt Wilhelm case that really created the starting point for the European enforcement of antitrust laws .In this decision, the ECJ ruled that national law could not permit an agreement or conduct that was prohibited under EU competition law. Regulation 1/2003 codifies some of the earlier case law in this area and sets out the general landscape of the EU Antitrust enforcement system . Without going into too much detail, under that statute, national competition authorities or NCAs (such as the Autorité de la Concurrence in France and the Bundeskartellamt in Germany) along with the courts, must apply article 101 et 102 TFEU when the antitrust violation may affect trade between member states. Furthermore, according to Article 16, NCAs must not take decisions that conflict with existing European Commission decisions. More recently, we have witnessed the increase of cooperation between NCAs and the Commission but also between NCAs with the development of the European Competition Network (ECN). Finally, it is also important to underline that it is the CJEU that controls the Commission’s investigations and rulings while it is national courts that control those of the NCAs. For example, for the French Autorité de la Concurrence, it is the Cour d’Appel de Paris (Paris Court of Appeals) which fulfills this role.
In the USA, the enforcement system is a little different; there is a double level of public enforcement: by the Federal Trade Commission (FTC) and the Antitrust Division of the US Department of Justice (DOJ). The Antitrust Division is responsible for enforcing the Sherman Act both criminally and civilly and the Clayton Act civilly; while the FTC is an independent regulatory agency which has the authority both to investigate and to prosecute civilly under Section 5 of the FTC Act. As the Antitrust Division is linked to the executive branch and the FTC to Congress, the enforcement work undertaken by both agencies has varied a lot depending on presidential priorities and the resulting funding decisions. However, since the Clinton administration, these variations have largely disappeared .
There was an important debate in the 2000s about the lack of coordination between the Antitrust Division and the FTC which could result in a overlapping of investigations. These difficulties seem now to have been resolved, especially because of the coordination between the two agencies and it seems now that it is the Antitrust Division which is mostly responsible for analyzing the companies’ behavior with regard to infringement of Section 2 of the Sherman Act .
While it is true that the structure of the two enforcement systems differs, the main difference between the two concerns application. The Microsoft prosecutions that we studied earlier provide very good examples of these differences. While the US case ended in a settlement that has been criticized as too lenient, the EU case ended in a decision imposing harsh remedial measures (injunctions etc.) and a record fine of €497m (over €800m if we take into account the later additional fines). The Microsoft litigation is a very interesting illustration of the paradox of the two systems: they started in similar fashions, both demonstrating their intention to challenge Microsoft’s domination over the market of Intel-compatible computers, but ended very differently. However, we will see later in this paper how this gap between the two leading antitrust systems has narrowed considerably since that time.
Given the similarity of US and EU antitrust law, why are they enforcing their laws so differently? Many legal commentators assert that antitrust law in the US focuses on protecting the competitive process while the EU emphasizes protecting consumers through competition . However, we see throughout this paper how consumer welfare is at the center of both systems. Another explanation could be that the power of political lobbies has contributed to a more lenient environment in the US, while the EU has faced mounting pressure to weaken Microsoft’s market power .
(ii) Private enforcement
In the EU, the famous Courage and Manfredi cases set out the general principles and conditions of individual liability for damages . In Courage, the CJEC established the principle that any individual has the right to claim for losses caused by an abuse of a dominant position. Consequently, national law has to provide all the means necessary for the effective private enforcement of Article 102 TFEU. In Manfredi, the European Court established the principle of full compensation for violations of articles 101 and 102 TFEU. However, the Court left considerable discretion to national courts to apply procedural rules of their domestic systems, as well as the substantive rules of recovery in torts, delict, etc. 
In the US, any person “injured in his business or property by reason of anything forbidden in the antitrust laws” may recover treble damages, costs and attorneys’ fees . According to the Hawaii v. Standard Oil Co. case, a state is considered as a “person” because of its capacity to consume goods and services and therefore may sue to recover treble its damages . Further, in 1976 the Congress empowered State Attorneys General to bring parens patrie lawsuits on behalf of state citizens to recover treble damages . Another important feature of the US private enforcement is the possibility to put forward class actions which can have an important deterrent effect on dominant firms.
As Professor Prieto has pointed out, private enforcement is limited in Europe because the European Commission does not want to copy the US system where private enforcement represents 90 per cent of cases. Indeed, its preferred route is to enhance the credibility of public enforcement and deter anticompetitive behaviors by encouraging private actions for damages resulting from public enforcement investigations and decisions .
B. Converging paths?
The two systems have their advantages and there is clearly a need to find a balance between the two in order to find the most effective way to fight exclusionary conduct and advance consumer welfare. Recent developments have shown that on the one hand, US public enforcement is getting more aggressive, providing harsher decisions driven by the Commission’s application of article 102, and, on the other, the European Union is trying to develop its private enforcement, inspired by the US system.
(i) The evolution of US public enforcement
There are considerable contacts between the US and EU Competition agencies and this phenomenon has developed considerably in recent years. For example, some working groups with staff from both agencies have been created, dealing with issues such as antitrust/intellectual property issues . Also, the EU Commissioner for Competition, the DOJ’s Assistant Attorney-General for Antitrust and the FTC Chairman played leading roles in the creation of the International Competition Network (ICN), which seeks to facilitate cooperation between competition authorities globally. That is why we talk about a “globalization of antitrust enforcement” today . It is probably because of this significant level of cooperation between the two enforcement systems that the US agencies have moved towards a harsher enforcement regime, especially under the Obama administration.
The Intel litigation is a very good example of how US public enforcement is getting closer to the European system. In May 2009, the European Commission imposed one of the largest antitrust fines in its history for Intel’s abuse of a dominant position. It explained that the discounts offered by Intel were so large that AMD had not be able to compete, and therefore consumers would face higher prices sometime in the future .The Commission’s decision was vigorously criticized in the USA, mainly because the former had decided to attack one of the most successful US firms without actual evidence that its conduct had harmed (or would harm) consumers.
Until 2009, antitrust enforcement agencies did not choose to attack the most successful firms without unequivocal evidence of anticompetitive and exclusionary conduct. However, the nomination of Christine Varney as Assistant Attorney General for Antitrust heralded a change. She announced that the DOJ would “begin scrutinizing big business in a way that it hasn’t been scrutinized for a long time.” She also made clear that in the new-look DOJ, the existence of possible harm would be enough to warrant the investigation of a complaint. The FTC, without being as explicit, launched at that time several investigations against big firms, including Intel. According to Michael Reynolds, the explanation for this change in public enforcement policy is simple, there is a big influence of the Economic crisis: “in the current economic environment, the competition authorities have an interest in seeking to ensure markets remain open and competitive” .
In its complaint against Intel, the FTC alleged that, through the use of loyalty discounts offered to microprocessor purchasers, Intel unlawfully excluded rivals and harmed consumers in the microprocessor and graphics processor markets . We see here how the FTC’s complaint is close to that of the EU Commission; in both cases the enforcement bodies filed a complaint based on the principle of speculative future consumer harm. As explained by Professor Wright, for the FTC, the loyalty discounts acted as de facto exclusive dealing arrangements, excluding ‘locked-in’ OEMs from purchasing their requirements from AMD or other manufacturers and therefore, Intel’s conduct violated Section 2 of the Sherman Act .
The main problem for US agencies is that the Courts do not seem to share the same point of view regarding enforcement. Indeed, in numerous decisions, the US Courts have safeguarded loyalty discounts from liability under Section 2 of the Sherman Act and also have always required some evidence of consumer harm. In 2009, Pr Wright explained that “in the end, either the Antitrust Division will fail, or the courts will bend in a way that unsettles the law”. We will see later in this Section that it seems that it is the Courts which are also evolving towards harsher enforcement .
(ii) The evolution of EU private enforcement
A 2004 study ordered by the European Commission found private enforcement of antitrust law in the EU to be in a state of “total underdevelopment” . As a result, the Commission is constantly trying to find measures to facilitate private litigation. Europe is beginning to realize that private enforcement can enhance consumer welfare when it is well regulated. Indeed, the main advantage of private enforcement is that it complements the “necessarily limited governmental resources that can be devoted to deterring and remedying the effects of anticompetitive conduct” . However, the main danger with an abuse of private enforcement is a risk of deterring procompetitive conduct to the detriment of consumers simply because it would become costly for companies to be aggressively competitive.
In June 2013, the European Parliament and Council proposed together a draft directive regulating actions for damages for infringements of competition law . This directive contains some very interesting features in order to facilitate private actions. For example, it establishes a presumption of harm resulting from a cartel because of “the secret nature of a cartel, which increases the said information asymmetry and makes it more difficult for the injured party to obtain the necessary evidence to prove the harm” (Chapter V: Article 16). It also underlines the need to take into consideration loss of profits in addition to actual loss (Chapter IV: Articles12-15).
Second, in its communication on quantifying harm in actions for damages based on breaches of Article 101 or 102 of TFEU , the European Commission presented a very interesting and precise method for quantifying harm, drawing on econometric models respected in the scientific community for their reliability . These formula, intended for national courts and plaintiffs, are not legally binding, but play a vital pedagogical role in a very technical field.
Third, the Commission has made some very important proposals concerning class actions . The key element is an “opt-in” principle which basically means that only the persons who have explicitly demonstrated their desire to become members of the class can be a part of it. That’s why some legal commentators have said that this proposal represents “half-way progress”, particularly since the Commission had included “opt-out” actions in its earlier draft (with any person fitting into the class definition able to participate). Although these two documents do not have any binding effect on member states, they may serve as a basis for later legislative initiatives .
C. Illustration: the loyalty discounts litigation
There is recent evidence of the convergence between the US and the EU public enforcement of their antitrust laws in the way the two systems treat loyalty discounts . The EU Commission has repeatedly challenged rebate systems under Article 102. Indeed, in numerous decisions, European courts have followed the Commission and prohibited discounts made in order to encourage loyalty when they are aimed to deter purchases from the competitors of the dominant firm. This was made especially clear in the Michelin II case where the Court of First Instance ruled that a “loyalty-inducing discount system” was represented proof of exclusionary conduct (“abuse”) because it constituted a strong incentive to obtain supplies from the dominant firm and made it impossible for Michelin’s rivals to gain market access .
In the USA, the exact opposite situation pertained for a very long time. Under the US Supreme Court decision Brooke Group, discounts in order to secure customer loyalty were sheltered from Section 2 of the Sherman Act, even if the effect of those discounts was to exclude the dominant firm’s competitors . This precedent was not challenged, either by the enforcement agencies or the US Courts for more than twenty years. The view was that antitrust enforcement should not extend to “non predatory pricing” . However, the very recent ZF Meritor decision has shown a very different view which has attracted considerable attention . In this case, the Third Circuit considered loyalty discounts as “de facto partial exclusive dealings contracts”, subject to rule of reason analysis under Section 2 of the Sherman Act. According to the court, it was the fact that these rebates were “above-cost pricing strategies” that really constituted exclusionary conduct. On this point, the reasoning is a little different from that of the Europeans. Indeed, EU case law at no point took into consideration the question of whether the discounts were or were not above or below cost.
Commissioner Joshua Wright endorsed the Third Circuit’s decision, explaining that exclusive dealing arrangements and loyalty discounts at issue were much more likely to be anticompetitive than procompetitive . This clearly means that the FTC will rely on the ZF Meritor case in order to challenge above-cost loyal discounts made by dominant firms. Finally, it is very important to add that on April 29th 2013, the Supreme Court declined to review this decision. This is likely to increase the long-term impact of the innovative Third Circuit’s ruling.
4. Conclusion: Consumer welfare at the heart of both systems
Today, it would appear that there is little disagreement about the basic purpose of competition law. To quote Pitofsky, Goldschmid and Wood, “a consensus has developed in the United States that the purpose of antitrust laws is principally (if not exclusively) to promote consumer welfare.”  In Europe, this approach was well reflected in the Vertical Guidelines which clearly state that “the protection of competition is the primary objective of EC competition policy as it enhances consumer welfare and creates an efficient allocation of resources” .
As we have seen, this idea of consumer welfare clearly appears in the way courts apply Section 2 and Article 102. First, it is at the heart of the appreciation of the conduct requirement since in both systems this conduct is considered “exclusionary” only if it harms consumers. Second, consumer welfare is the aim of the whole enforcement policy. For example, Intel was attacked by both EU and US agencies because of the potential harm to consumers, even though there was no actual evidence of it.
Is it because of this common aim that both systems are becoming increasingly similar? The answer to this question is not clear but it certainly provides part of the explanation.
The fact that the two systems regulate certain activities, allowing “natural monopolies” to exist, is a final illustration of this similarity. A natural monopoly is a situation in which “economies of scale are so large that one firm can supply the entire market at a lower average total cost than can two or more firms” . In this case, there is room for only one firm. The idea here is that competition should not play its role of pushing prices down when the company earns zero profit (the price charged being less than its marginal cost) and usually it is state regulatory bodies that set prices for natural monopolies. Quoting Professor Perloff, this tends to be the case in industries where capital costs predominate, creating economies of scale that are large in relation to the size of the market, and hence creating high barriers to entry . The examples are numerous: public transportation, water services, electricity etc. However, sometimes, the industry is regulated not because there is a real situation of natural monopoly, but because it is in the consumer’s interest that this industry should be regulated and the price set. This is why in all major cities there is for example a monopoly on taxis (yellow and green cabs in Manhattan); it is a way of making sure the customer will not be charged an abusive price since all the rates are fixed by a regulatory body. Some advocates of the self-regulating market claim that the State should not play a role in fixing prices and advantaging certain companies, but they only represent a minority of commentators and most now see the necessity of having regulated monopolies .
Ecole de droit de la Sorbonne
Alliance Program with Columbia Law School
 Hovenkamp, Federal Antitrust Policy The Law of Competition and Its Practice (2011).
 Fox, An Antitrust Fable – A Table of Predation, Concurrences (2008).
 See infra, 4.
 United Brands Company v. Commission, 82/76 (ECJ. 1978); Hoffmann-La Roche & Co. AG v. Commission, 85/76 (ECJ. 1979).
 Prieto & Bosco, Droit européen de la concurrence: pratiques anticoncurrentielles (2013).
 United States v. E.I. du Pont de Nemours & Co., 351 U.S. 377 (1956).
 United States v. Microsoft Corp, 56 F.3d (D.C. Cir. 2001).
 Guidance on the European Commission’s enforcement priorities in applying Article 82 of the EC Treaty to abusive exclusionary conduct by dominant undertakings (2009).
 Luis Ortiz Blanco, Market Power in the EU Antitrust Law (2012).
 See, e.g., Exxon Corp. v. Berwick Bay Real Estate Partners, 748 F.2d (5th Cir. 1984).
 Virgin v. British Airways, 95/04 (ECJ. 1999).
 AKZO Chemie BV v Commission, 62/86 (ECJ. 1991).
 U.S. Dep’t Of Justice, Competition and monopoly: Single-firm Conduct Under Section 2 of The Sherman Act (2008).
 United States v. Alcoa, 377 U.SS 271 (1964); Hoffmann-La Roche & Co. AG v. Commission, 85/76 (ECJ. 1979).
 Hilti AG v. Commission, 30/89 (CFI. 1991).
 See supra, note 4, at 4.
 See, e.g., Invaldi & Lorincz, Implementing Relevant Market Tests in Antitrust Policy: Application to Computer Servers, Universite de Toulouse (2006); Market definition, OECD Policy Roundtables (2012).
 FTC v. Indiana Federation of Dentists, 476 U.S. 447 (1986).
 OECD « Policy Brief » (September 2008).
 See supra, note 1, at 2.
 See supra, note 3, at 3.
 Reazin v. Blue Cross & Blue Shield of Kansas, Inc., 663 F.Supp. 1360 (1987).
 See supra, note 3, at 3.
 United Brands Company v. Commission, 82/76 (ECJ. 1978); Hilti AG v. Commission, 30/89 (CFI. 1991); Tetra Pak International SA v. Commission, 83/91 (CFI. 1994).
 United States v. Microsoft Corp., supra, note 6, at 3; See also FTC Complaint against Intel Corporation, Docket no.9288 (2009).
 United States v. Alcoa, 377 U.SS 271 (1964); United Brands Company v. Commission, 82/76 (ECJ. 1978)
 Statement of John J. Flynn, National Comm. for the Review of Antitrust Laws and Proc. (1978).
 Report of the President and The Attorney General of the National Com. for the Review of Antitrust Laws and Proc. (1979) reprinted in 897 antitrust & trade reg. rep. (bna) (special supp.) (1979).
 Dougherty, Kirkwood & Hurwitz, Elimination of the Conduct Requirement in Government Monopolization Cases, 37 Washington and Lee Review (1980).
 See supra, note 1, at 2.
 See supra, note 11, at 5.
 Noble, No fault Monopolization: Requiem or Rebirth for Alcoa?, New England Law Review (1982).
 See United States v. Microsoft, 253 F.3d (2001) (“Whether any particular act of a monopolist is exclusionary, rather than merely a form of vigorous competition, can be difficult to discern: the means of illicit exclusion, like the means of legitimate competition, are myriad. The challenge for an antitrust court lies in stating a general rule for distinguishing between exclusionary acts, which reduce social welfare, and competitive acts, which increase”).
 Michelin v. Commission, 322/81 (ECJ, 1983).
 United States v. Griffith, 334 U.S. 100 (1948).
 Jones & Suffrin, EC Competition Law: Text, Cases and Materials (2008).
 BPB Ind. Plc and British Gypsum Ltd v. Commission, 65/89 (CFI. 1993); United States v. Alcoa, 377 U.SS 271 (1964).
 United States v. Grinell, 384 U.S 563 (1966).
 See, e.g., Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 US. 585 (1985).
 See supra, note 3, at 3.
 Dabbah, European Union Competition Law (2012).
 DG Competition discussion paper on the application of article 82 of the Treaty to exclusionary abuses (2005).
 Aspen Skiing Co. v. Aspen Highlands Skiing Corp., 472 US. 585 (1985).
 See, e.g., Eastern Kodak Co. v. Image Technical Servs., Inc., 504 US 451 (1992); Verizon v. Trinko., 540 US 398 (2004).
 See, e.g., Popofsky, Defining Exclusionary Conduct: Section 2, The Rule of Reason, And The Unifying Principle Underlying Antitrust Rules, 73 Antitrust Law Journal (2006); Grimm, General Standards for Exclusionary Conduct, FTC Working Papers (2008); Hovenkamp, Federal Antitrust Policy The Law of Competition and Its Practice (2011).
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 American Tobacco Co. v. United States, 328 US 781 (1946).
 SIV and Others v. Commission, 68/89, 77/89 and 78/89 (1991).
 See supra, note 6, at 3.
 Pitofsky, Goldschmid and Wood, Trade Regulation: Cases and Materials (2010).
Commission v. Microsoft Corp., Complaint C-3/37.792 (2004).
 Commission v. Microsoft Corp., 201/04 (CFI. 2007).
 Walt Wilhelm and others v. Budeskartellamt, 14-68 (ECJ. 1969).
 Willis, Introduction to EU Competition Law (2005).
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 Bartalevictch, EU Competition Policy since 1990: How Substantial is Convergence towards U.S Antitrust?, 6 JCC: The Business and Economics Research Journal (2013).
 See, e.g., Fox, US and EU Competition Law: A Comparison, Global Competition Policy (1997)
 Jennings, Comparing the US and EU Microsoft Antitrust Prosecutions: How Level is the Playing Field?, Erasmus Law and Economics Review 2 (2006).
 Courage Ltd v. Bernard Crehan, 453/99 (ECJ. 2001); Vicenzo Manfredi v. Lloyd Adriatico, 295/04 (ECJ. 2006).
 Whish and Bailey, Competition Law (2012).
 15 U.S.C §§15,26.
 Hawaii v. Standard Oil Co., 405 U.S 251 (1972).
 Ginsburg, Comparing Antitrust Enforcement in the US and Europe, Journal of Competition Law and Economics (2005).
 See supra, note 4, at 3.
 Kovaviv, Competition policy in the European Union and the United States: convergence or divergence in the future treatment of dominant firms?, Competition Law International (2008).
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 Hylton, Manne & Wright, US Antitrust Becomes More European, Forbes, May, 2009 (http://www.forbes.com/2009/05/18/intel-amd-antitrust-ftc-opinions-contributors-christine-varney.html).
 Watson, Chipping Away at Competition Abuses, International Bar Association (2009) (http://www.ibanet.org/Article/Detail.aspx?ArticleUid=2046f1e0-6e1a-421f-9eb6-b0181fc77b15)
 Wright, An Antitrust Analysis of the Federal Trade Commission’s Complaint Against Intel, ICE Antitrust and Competition Policy White Paper Series (2010).
 See infra, Part III.C.
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 Ginsburg, Comparing Antitrust Enforcement in the US and Europe, Journal of Competition Law and Economics (2005).
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 Communication from the Commission, Toward a European Horizontal Framework for Collective Redress, COM 2013/401/2 (2013); Commission Recommendation of 11 June 2013 on common principles for injunctive and compensatory collective redress mechanisms in the Member States concerning violation of rights granted under Union Law 2013/396/EU (2013).
 Cardonnel, Lacresse & Le Maire, La Commission adopte un paquet de mesures sur les actions en dommages et intérêts, Concurrences (2013).
 Fogt, US and EU Converging On Dominant Firm-Abuse Theory (2013) (http://www.foley.com/files/Publication/8d2b0ee7-5878-41b2-aa6f-cfae639d4e71/Presentation/PublicationAttachment/a59b8451-787d-451c-b15e-d15fbb04bb0b/US%20And%20EU%20Converging%20On%20Dominant.pdf).
 Michelin v. Commission, 203/01 (CFI. 2003).
 Brooke Group Ltd. v. Brown & Williamson Tobacco Corp., 509 U.S. 209 (1993); See, Hobayashi, The Economics of Loyalty Discounts and Antitrust Law in the United States, George Mason University School of Law Working Papers Series (2005).
 Denger & Herfort, Predatory Pricing After Brooke Group, 62 Antitrust Law Journal (1994).
 ZF Meritor LLC v. Eaton Corporation, 696 F.3d 254 (3rd Cir. 2012).
 Statement of Commissioner Joshua D. Wright, FTC File No. 101-0215 (2013).
 See supra, note 49, at 12.
 Commission Notice, Guidelines on Vertical Restraints (2010), http://ec.europa.eu/competition/antitrust/legislation/guidelines_vertical_en.pdf
Sullivan and Grimes, The Law of Antitrust: An Integrated Handbook (2006).
 Perloff, Microeconomics (2012).
 See, e.g., DiLorenzo, The Myth Of Natural Monopoly, The Review of Austrian Economics (1996); Rothbard, Power and Market (2006).