quantities, etc,) and effective in remedying competitive harm*. Thus, it is expected thatconsumer harm that may arise from anticompetitive mergers can be restrained moreeffectively when structural remedies are allowed to have precedence over behavioralremedies.
* Structural remedies help keep the market structure itself competitive andconsequently prevent a merged firm from developing the ability to engage inanticompetitive behavior such as price increase, etc.
This principle of preferring structural remedies over behavioral ones is in line with theglobal standard, which has generally been incorporated into the guidelines for correctiveactions by major competition authorities in, such as, the United States, EU, UK.2.
The standard provides for IPR-related actions and specifies the reasons for theimposition of such actions.
In line with the recent trend
of international discussions, the standard prescribes disposal or licensing of intellectual property rights (IPR) or other IPR-related actions if competitiveconcerns regarding a merger primarily arises from the overlap or concentration of intellectual property rights.
* The review report (released in June 2005) of INC (International Competition Network), aglobal consultative body that seeks to facilitate cooperation among competitionauthorities, puts such IPR actions under a separate category of merger remedies.
IPR actions may be considered a type of asset divestiture or behavioral remedies, but, -- now being prescribed separately in the standard-- are expected to work as more effective restraintthat prevents the merged firm from acquiring dominant market power upon consolidation of intellectual property rights.3.
The standard presents general principles of imposing merger remedies andcriteria for determining remedies by type.
The standard sets forth general principles for crafting optimal remedies tailored to specificanticompetitive effects; the principle of effectiveness, the principle of proportionality, the principle of clarity and enforceability, etc.It classifies merger remedies into structural and behavioral ones, and specifies each type of such remedies and criteria for imposing remedies by type.It prescribes full-stop injunction, divestiture of assets and IPR actions for structural remedies,and specifies reasons and criteria for imposing such measures.