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Exclusive Q&A on Competition & Antitrust with William Kolasky

Posted: 11th May 2017 10:31
Can You Talk Us Through The Current Competition And Antitrust Landscape In Your Jurisdiction?

When Barack Obama campaigned for presidency in 2008, he vowed “to reinvigorate antitrust enforcement,” if elected. Eight years later, I think most antitrust lawyers would agree that President Obama delivered on this campaign promise.
During his Administration, both the Department of Justice (“DOJ”) Antitrust Division and the FTC have pursued an aggressive antitrust enforcement program, in terms of both criminal and civil enforcement. Over the last eight years, DOJ has collected more than $9.4 billion in fines and has put 191 executives in jail for price fixing and bid rigging. These fines included a staggering $3.86 billion from major banks for allegedly manipulating several important financial benchmarks. On the civil side, both agencies have won important victories in court in both merger and non-merger cases and have forced the parties to several high-profile transactions to abandon those deals in the face of an agency challenge.
In short, both agencies have compiled a very impressive enforcement record over the last eight years.

Have There Been Any Recent Regulatory Changes Or Interesting Developments?

Obviously, the most important recent development in the U.S. in terms of the future direction of antitrust policy – as in almost every other area – was the election of Donald Trump as our 45th president.
At this point, without knowing who Trump will appoint to head the Antitrust Division and the FTC, it is hard to predict with any certainty in what direction he will take antitrust enforcement. The populist tone of both his campaign and his Inaugural Address might suggest stronger antitrust enforcement, especially against companies in highly concentrated industries. But his rumoured appointments to the antitrust agencies would seem to suggest a move back toward the more laissez faire enforcement we saw during the Bush Administration, especially in its last four years. One particular thing that has many antitrust lawyers concerned are the meetings President Trump has had with the CEOs of the companies involved in the two largest mergers now before the agencies, the Bayer/Monsanto and AT&T/DirecTV mergers.
Those meetings make some antitrust lawyers apprehensive that Trump might personally intervene in enforcement decisions for reasons unrelated to protecting competition, such as preserving American jobs.
OS: On 19 January 2017, the Italian Government published a legislative decree implementing the Damages Directive (n.3/2017).The decree substantially reflects the structure and the content of the Directive in relation to both the substantive and the procedural rules.
Two peculiarities that are worth noting concern the scope of the application of the new rules, which expressly includes class actions, and the jurisdiction, which is reserved to the specialised sections of the courts of Milan, Rome and Naples.
The decree also modifies the general competition law regime, expressly empowering the ICA to apply Articles 2 and 3 of law n. 287/90 in parallel with the corresponding EU rules (respectively, Articles 101 and 102 of the TFEU). Unlike most EU countries, the system initially chosen by the Italian legislator back in 1990 provided for a “single barrier”, according to which the national rules applied only to practices falling outside the scope of the EU rules (i.e. which did not affect trade between Member States). 

What Has Caused The Recent Trend Towards High-Profile Challenges To Mergers & Acquisitions In The United States By The FTC And DOJ? Can You Outline The Key Principles To Effective Merger Remedies And Negotiations?

I would say that thereare two factors at work here. The first is that the companies involved in these deals appear to have misjudged the willingness of the agencies to go to court to block high-profile mergers rather than accept structural or conduct remedies as they had in the past. The second is that both agencies have substantially strengthened their litigation capabilities and are now much more willing – perhaps even eager – to go to court, after having won a string of major victories in cases like H&R Block/TaxAct, Sysco/US Foods, and Staples/Office Depot.
The FTC and Antitrust Division have both issued detailed guides to their policies with respect to merger remedies that any company considering a merger that may raise antitrust concerns should study closely. That said, I think there are three key principals to negotiating an effective merger remedy.
The first is that the remedy must fully address the agency’s competitive concerns and, to the extent possible, preserve the status quo ante in those markets in which competition may be substantially lessened by the merger.
The second is that both agencies strongly prefer structural remedies, but may accept conduct remedies where a merger will create significant efficiencies that would be lost by a structural remedy.
The third is that the agencies’ process for evaluating a proposed remedy is very fact-intensive and will involve close scrutiny both of the scope of the assets to be divested and the ability of the buyer of the divested assets to compete effectively in the relevant market. This process can sometimes take several months.

How Can A Company Conduct Effective Global Antitrust And Competition Risk Assessment And How Important Is The Implementation Of An Effective Compliance Program?

I cannot stress strongly enough the importance for all companies, but especially large publicly traded companies, to have in place an effective antitrust compliance program.
A company that is found guilty in the U.S. of price fixing, bid rigging or customer allocation faces not only substantial criminal fines in the hundreds of millions of dollars and jail sentences for the executives involved in that conduct, but also having to pay treble damages to any direct purchasers (and indirect purchasers in some states) injured by the conduct. It was recently reported, for example, that automotive parts manufacturers have already paid settlements totalling over $1.1 billion in the follow-on class actions to the DOJ’s long-running criminal investigation of price fixing for auto parts.
In terms of how a company can conduct an effective global antitrust assessment, it may sound self-serving, but I think it is important for a company to hire experienced antitrust counsel to help it develop a plan for conducting that assessment and to assist in implementing that plan. There is no one size fits all, but the one thing that is critically important is that senior management give its full support to the assessment effort. The tone starts at the top.

What Action Should A Company Take If It Uncovers A Potential Antitrust/Competition Breach? Are Companies Encouraged To Self-Report Any Wrongdoing?

I would strongly encourage any company that uncovers a potential antitrust violation by its employees to consult experienced antitrust counsel as soon as possible and to seek their advice as to whether to self-report the potential wrongdoing in order to take advantage of the leniency programs that are now available, not just in the U.S., but in many other jurisdictions around the world. I’ve already described the substantial penalties that can be incurred as a result of a violation.
Those penalties can be substantially mitigated by self-reporting. In the U.S., a company that is the first to report a criminal violation not only qualifies for a “get out of jail free” card for itself and its current employees, but also will be subject only to single (rather than treble) damages and will be protected from joint and several liability for injuries suffered by the buyers of its alleged co-conspirators. Because these protections are available only for the first company to report the violation, any delay in reporting risks another co-conspirator getting there first.

William Kolasky is a partner in Hughes Hubbard & Reed, LLP, where he is the chair of the firm’s antitrust practice based in Washington, DC.  Mr. Kolasky previously served as the Deputy Assistant Attorney General for Policy in the Antitrust Division of the U.S. Department of Justice and received the Global Competition Review’s Lifetime Achievement Award in 2013.  He has taught antitrust law at American University’s Washington College of Law and has written extensively on antitrust topics.

William can be contacted on +1 202 721-4771 or by email at

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