OECD raises antitrust issues in Argentina

1.    The OECD recommendations

The “Peer Review” analysis is a mechanism founded upon the willingness of countries to submit their laws and policies to questioning by other members. This report was presented last October 5 by the Economy Minister , Ms. Felisa Micelli and the President of the National Commission for Defense of Competition (“CNDC”), Mr. José Luis Sbatella.

The report recommends as follows:

(i)          National Tribunal for the Defense of Competition

It notes that seven years have passed since the enactment of the Antitrust Law No 25,156 and the independent Tribunal has not yet been created. Additionally, it suggests that if it is necessary to amend the law to grant to the Executive powers to overrule a decision of the Tribunal in merger cases, such powers should be limited to matters of “overriding public interest”.

(ii)         Competition Agency Budget

The report recommends increasing the budget and also suggests granting to the agency, whether the Tribunal or the CNDC, greater authority on budget decisions.

(iii)       Anti-cartel enforcement

The fight against cartels should be the top priority within the agency. In successful cases against harmful, knowingly unlawful cartels, the fines should be increased, and individuals should also be fined. The report also proposes the setting up of a leniency program.

(iv)        Conduct investigations

It recommends considering ways of summarily dealing with private complaints that clearly do not constitute violations of the Antitrust Law. In other cases in which sanctions are ultimately not imposed, procedures should be established to shorten the time and resources required to reach decisions of the CNDC and recommendations of the Secretariat.

(v)         Merger review

The report also suggests increasing the notification thresholds and working to shorten the period required for approval of “simple” mergers from the current 3-4 month average. It continues to aggressively oppose the right of third parties to appeal against merger decisions of the CNDC.

(vi)        Merger notification regime

The report suggests considering procedures that would permit the CNDC, in appropriate cases, to make an order prohibiting the closing of a transaction pending review or, alternatively, to order the parties to a merger to keep “separate” their operations in order to permit a meaningful divestiture if required.

(vii)      Until the Antitrust Tribunal is set up, the CNDC should work as free from political influence as possible.

(viii)     An effective professional relationship should be developed with the judges who hear appeals in antitrust cases.

(ix)       The antitrust agency’s role in regulated sectors.

There should be investigations of conduct in these sectors, and, consistent with its limited budget, promotion of more antitrust advocacy. Cooperative working relationships with regulators should be developed.

2.    Comments

The report raises issues which are currently being discussed in Argentina among academics, practitioners and economists. The creation of an independent tribunal and a clear interpretation of the effects of merger cases before approval and compliance with the conditions imposed are issues which are currently being discussed by the judiciary.

This report is a landmark in terms of the identification of the outstanding issues under discussion in Argentina.