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Nonlegal Sanctioning in Private Legal Systems / Part I: Framework and Research Question
Nonlegal Sanctioning in Private Legal Systems / Part I: Framework and Research Question
Contents
Chapter
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Page
1–24
Titelei/Inhaltsverzeichnis
1–24
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25–34
Introduction
25–34
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35–186
Part I: Framework and Research Question
35–186
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Chapter 1: Rise of Specialized Commercial Arbitration in Global Markets
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A. An historical overview of PLSs
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I. Ancient Greece: “Self-regulation within the Oikos in classical Athens”
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II. The Roman Empire: “Flexibility & risk allocation with regard to lease contracts in the agriculture sector”
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III. Medieval Times: “Lex Mercatoria”
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IV. The Industrial Revolution
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B. The theory on present-day PLSs
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I. Present-day PLSs: General characteristics
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1. Self-governance in reputation-based networks vs. governance of members by and through associations
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2. Market of trust
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3. Naming and shaming through an information exchange
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4. Market where a loss of social standing is important
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II. Typology of nonlegal sanctions in present-day PLSs
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1. Blacklisting
Details
2. Withdrawing membership
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3. Denying membership for expelled members on the basis of an additional entry barrier
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4. Refusing to deal with an expelled member
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5. Entering the premises of a recalcitrant industry actor
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6. Limiting adequate access to public courts prior to arbitral proceedings and after an award
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C. Present-day PLSs vs. State-enforced contract law
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I. Inefficiency of the court system
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II. Increased contractual security / Safeguarding the sanctity of contract
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III. Lower transaction costs
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IV. Lower distribution costs
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Chapter 2: Examples of Present-day PLSs in which Private-enforcement / Nonlegal Sanctioning Ensures Compliance
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A. Introduction
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B. The International Cotton Association
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I. Background
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1. History
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2. Legal form
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3. Institutional structure
Details
4. Membership
Details
5. Specialized commercial arbitration
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a. A dichotomy of arbitration forms
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b. Selection of arbitrators
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i. Quality arbitration
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ii. Technical arbitration
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c. Choice of tribunal and jurisdiction of arbitration tribunals
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i. Quality arbitration
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ii. Technical arbitration
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d. Procedure
Details
i. Quality arbitration
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ii. Technical arbitration
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e. The finality of arbitration or the possibility of (some) legal redress in public courts according to the association
Details
i. Quality arbitration
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ii. Technical arbitration
Details
II. Nonlegal sanctioning
Details
1. Blacklisting
Details
2. Withdrawing membership
Details
3. Denying membership for expelled members on the basis of an additional entry condition
Details
4. Refusing to deal with expelled members
Details
III. Rationale for private enforcement/nonlegal sanctioning
Details
C. The Diamond Dealers Club
Details
I. Background
Details
1. History
Details
2. Legal form
Details
3. Institutional structure
Details
4. Membership
Details
5. Specialized commercial arbitration
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a. The single arbitration model
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b. Selection of arbitrators
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c. Choice of tribunal and jurisdiction of arbitration tribunals
Details
d. Procedure
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e. The finality of arbitration or the possibility of (some) legal redress in public courts according to the association?
Details
II. Nonlegal sanctioning
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1. Blacklisting
Details
2. Withdrawing membership
Details
III. Rationale for private enforcement/nonlegal sanctioning
Details
D. The Grain and Feed Trade Association
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I. Background
Details
1. History
Details
2. Legal form
Details
3. Institutional structure
Details
4. Membership
Details
5. Specialized commercial arbitration
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a. Tripartite arbitration
Details
b. Selection of arbitrators
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c. Choice of tribunal and jurisdiction of arbitration tribunals
Details
d. Procedure
Details
e. The finality of arbitration or the possibility of (some) legal redress in public courts according to the association?
Details
II. Nonlegal sanctioning
Details
1. Blacklisting
Details
III. Rationale for private enforcement/nonlegal sanctioning
Details
E. The Federation of Cocoa Commerce
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I. Background
Details
1. History
Details
2. Legal form
Details
3. Institutional structure
Details
4. Membership
Details
5. Specialized commercial arbitration
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a. A dichotomy of arbitration forms
Details
b. Selection of arbitrators
Details
c. Choice of tribunal and jurisdiction of arbitration tribunals
Details
d. Procedure
Details
e. The finality of arbitration or the possibility of (some) legal redress in public courts according to the association?
Details
II. Nonlegal sanctioning
Details
1. Blacklisting
Details
2. Withdrawing membership
Details
III. Rationale for private enforcement/nonlegal sanctioning
Details
F. The London Metal Exchange
Details
I. Background
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1. History
Details
2. Legal form
Details
3. Institutional structure
Details
4. Membership
Details
5. Specialized commercial arbitration
Details
a. The single arbitration model
Details
b. Selection of arbitrators
Details
c. Choice of tribunal and jurisdiction of arbitration tribunals
Details
d. Procedure
Details
e. The finality of arbitration or the possibility of (some) legal redress in public courts according to the association?
Details
II. Nonlegal sanctioning
Details
1. The power to enter premises
Details
2. Blacklisting
Details
3. Withdrawing membership
Details
III. Rationale for private enforcement/nonlegal sanctioning
Details
G. The Federation of Oils, Seeds and Fats Association
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I. Background
Details
1. History
Details
2. Legal form
Details
3. Institutional structure
Details
4. Membership
Details
5. Specialized commercial arbitration
Details
a. Tripartite arbitration
Details
b. Selection of arbitrators
Details
c. Choice of tribunal and jurisdiction of arbitration tribunals
Details
d. Procedure
Details
e. The finality of arbitration or the possibility of (some) legal redress in public courts according to the association?
Details
II. Nonlegal sanctioning
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1. Blacklisting
Details
2. Withdrawing membership
Details
III. Rationale for private enforcement/nonlegal sanctioning
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Chapter 3: A comparative view of the Present-Day PLSs and their respective enforcement mechanisms
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A. Introduction
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B. Legal form
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C. Access to membership
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D. Structure and composition of the arbitration tribunal
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I. First-tier arbitration
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II. Second-tier arbitration/internal appeal
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III. Qualification criteria for candidate arbitrators
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E. The place of arbitration and applicable law
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F. The finality of arbitration or the possibility of (some) legal redress in public courts
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I. The English Arbitration Act 1996
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1. Judicial review at a public court prior to arbitral proceedings
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a. Stay of proceedings pursuant to Section 9 of the Arbitration Act 1996
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i. “Null and void” defence
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ii. “Inoperative” defence
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iii. “Incapable of being performed” defence
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b. Application to the court for preliminary ruling on jurisdiction
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2. Judicial review at a public court after an arbitral award has been rendered
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a. Insufficient reference made to a broader arbitration agreement within an arbitration clause included in a standardized agreement
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i. “Sufficient reference” to arbitration agreements within the standardized agreements provided by the UK-based trade associations
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ii. Examples of arbitration clauses within standardized contracts provided by the UK-based trade associations that refer to a broader arbitration agreement
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iii. The trade association and its members joint reprisal against members who/that seek redress at a public court to invalidate an arbitration agreement for the reason that the arbitration clause with...
Details
b. Lack of substantive jurisdiction of an arbitrator or arbitrators
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c. Unfair proceedings
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d. Review on the merits
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II. Article 75 of the New York Civil Practice Law and Rules and the US Federal Arbitration Act
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1. Judicial review at a public court prior to arbitral proceedings
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a. Stay of proceedings pursuant to Article 75, Section 7503 of the New York Civil Practice Law and Rules
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b. Application to the court for preliminary ruling on jurisdiction
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2. Judicial review at a public court after an arbitral award has been rendered
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a. Lack of substantive jurisdiction of an arbitrator or arbitrators
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b. Unfair proceedings
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III. Statement about the conformity of the trade associations and their members’ joint limitation to seek legal redress at a public court with the English Arbitration Act 1996, Article 75 of the CPLR ...
Details
G. A typology of nonlegal sanctions
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I. Blacklisting
Details
II. Withdrawing membership
Details
III. Denying membership for expelled members on the basis of an additional entry barrier
Details
IV. Refusing to deal with an expelled member
Details
V. Entering the premises of a recalcitrant industry actor
Details
VI. Limiting adequate access to public courts prior to arbitral proceedings and after an award.
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H. Reasons for nonlegal sanctioning
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I. Markets in which futures play a crucial role
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II. A market in which trust plays a crucial role
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Chapter 4: The Limits of Nonlegal Sanctioning
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A. The boundaries of nonlegal sanctioning
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I. US Antitrust Law: Sections 1 and 2 of the Sherman Act
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II. EU Competition Law: Articles 101 and 102 TFEU
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B. Prisoner’s dilemma type of function analogy
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C. The actors involved in nonlegal sanctioning
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I. Actors that take part in nonlegal sanctioning
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1. Trade associations
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2. Members of a trade association
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3. Non-members of a trade association
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II. Recipients of nonlegal sanctioning
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D. Research Question
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Chapter 5: Research Design and Research Methods
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A. Case studies
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I. Unnecessary redundancy exploratory research methodology
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II. Methodological adequacy
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B. Delimitation
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I. US Antitrust Law
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II. EU Competition Law
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III. Type of reasoning
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C. Reflection on the research question
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D. Objectives of this research
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I. Guidance for compliance with competition law
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II. Promoting transparency for trade associations, their members and non-members
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III. Promulgating best practice guidelines for actors that infringe US Antitrust Law and EU Competition Law
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187–282
Part II: Study of US Antitrust Law
187–282
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Chapter 6: Restraint of Trade or Commerce under Section 1 of the Sherman Act
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A. Introduction
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B. The actors involved in nonlegal sanctioning
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I. Individual members, member undertakings and non-members
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II. Trade associations
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C. Collusion: “a concurrence of wills”
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I. Contract
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II. Combination in the form of trust or otherwise
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III. Conspiracy
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D. An unreasonable restraint on competition: The existence of an illegal horizontal agreement and collective boycott
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I. Collection and dissemination of market information
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1. Blacklists by trade associations
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2. Execution of blacklists by members of trade associations
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3. Execution of blacklists by non-members
Details
II. Membership rules and barriers for market access
Details
1. Withdrawal of membership of a trade association
Details
a. Withdrawal by a trade association
Details
b. Execution of the withdrawal of membership by members of a trade association
Details
c. Execution of the withdrawal of membership by non-members
Details
2. Denial of membership for an expelled member on the basis of an additional entry requirement
Details
a. Access restrictions by a trade association
Details
b. Access restrictions by members of a trade association
Details
c. Access restrictions by non-members
Details
III. Refusal to deal with an expelled member
Details
1. Refusal to deal with an expelled member by a trade association
Details
2. Execution of the refusal to deal with an expelled member by members of a trade association
Details
3. Execution of the refusal to deal with an expelled member by non-members
Details
IV. Entering the premises of a recalcitrant industry actor without a warrant
Details
V. Limiting adequate access to public courts prior to arbitral proceedings and after an award
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E. A rule-of-reason analysis under Section 1 of the Sherman Act
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I. First step of the rule-of-reason defence: The existence of visibly plausible procompetitive benefits
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II. Second step of the rule-of-reason defence: Illustration that the visibly plausible efficiency or benefit cannot exist without the anticompetitive risk
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1. Efficiency defence: Consumer or total welfare justification
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2. Total welfare and consumer welfare vs. collective boycotts of targeted industry actors
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a. Blacklisting
Details
b. Membership rules and barriers for market access
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i. Withdrawal of membership
Details
ii. Denial of membership for expelled members on the basis of an additional entry condition
Details
c. Refusal to deal with an expelled member
Details
F. Key findings
Details
I. Qualification as member or undertaking
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II. Collusion: “a concurrence of wills”
Details
III. The anti-competitiveness of nonlegal sanctions
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IV. Rule-of-reason defence
Details
Chapter 7: Monopolization of any Part of the Trade or Commerce under Section 2 of the Sherman Act
Details
A. Introduction
Details
B. Unlawful monopolization by the trade associations researched
Details
I. The possession of monopoly power in the relevant market
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1. Market definition: Monopoly leveraging
Details
2. Market shares in the market for regulation and private ordering
Details
a. The International Cotton Association
Details
b. The Diamond Dealers Club
Details
c. The Grain and Feed Trade Association
Details
d. Federation of Cocoa Commerce
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e. London Metal Exchange
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f. Federation of Oils, Seeds and Fats Association
Details
3. Monopolization in the market for regulation and private ordering
Details
II. Anticompetitive conduct
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1. Monopoly leveraging doctrine: Attributing liability for a violation of Section 2 of the Sherman Act to the trade associations researched for utilizing a monopoly position in one market to punish wr...
Details
2. The anti-competitiveness of nonlegal sanctioning attributable to the trade associations researched and the existence of a rule-of-reason defence
Details
a. Blacklisting
Details
b. Membership rules and barriers for market access
Details
i. Withdrawal of membership
Details
ii. Denial of membership for expelled members on the basis of an additional entry condition
Details
c. Refusal to deal with an expelled member
Details
d. Entering the premises of a recalcitrant industry actor without a warrant
Details
III. Interim conclusion
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C. The functioning of the concept of illegal attempted monopolization as a safety net when one or more of the trade associations researched does not hold sufficient market power to establish monopoliz...
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I. Specific intent to monopolize
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II. Dangerous probability of achieving monopoly power
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III. Anticompetitive conduct (and rule-of-reason)
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IV. Interim conclusion
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D. Unlawful conspiracy to monopolize by members of the trade associations researched
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I. The existence of an agreement between two or more parties
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II. Specific intent to monopolize
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III. Overt act in furtherance of the agreement
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IV. Interim conclusion
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E. Key findings
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283–428
Part III: Study of EU Competition Law
283–428
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Chapter 8: The Scope of Application of European Competition Law
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A. The nucleus of European Competition Law: a brief overview
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B. Introduction
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C. Legal boundary
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I. Members of the trade associations researched and non-members
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II. Trade associations
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D. Economic boundaries: the effect on trade between Member States
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I. Interpretation by the Court of Justice of the European Union
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II. Interpretation by the Commission
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1. Commission Recommendation on SMEs and the positive and negative rebuttable presumption of non-appreciability
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2. The De Minimis Notice
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III. Do the extrajudicial measures imposed by the trade associations researched and executed by their members and non-members have an effect on Community trade?
Details
1. The concept of trade
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2. The presence of “may affect”
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3. The concept of appreciability
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a. Nonlegal sanctions as effect restrictions
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E. Key findings
Details
Chapter 9: Anticompetitive Agreements under Article 101(1) TFEU
Details
A. Introduction
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B. Collusion: “a concurrence of wills”
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I. Agreement between undertakings
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II. Decisions by associations of undertakings
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III. Concerted practices
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C. Prevention, restriction or distortion of competition: The existence of an illegal horizontal agreement and collective boycott
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I. Restrictions by object or effect
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II. Collection and dissemination of market information
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1. Blacklists by trade associations
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a. Asnef-Equifax/Ausbanc
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b. Compagnie Maritime Belge
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c. Statement
Details
2. Execution of blacklists by members of trade associations
Details
3. Execution of blacklists by non-members
Details
III. Membership rules and barriers for market access
Details
1. Withdrawal from a trade association
Details
a. Withdrawal by a trade association
Details
b. Execution of the withdrawal of membership by members of a trade association
Details
c. Execution of the withdrawal of membership by non-members
Details
2. Denial of membership for an expelled member on the basis of an additional entry requirement
Details
a. Access restrictions by a trade association
Details
b. Access restrictions by members of a trade association
Details
c. Access restrictions by non-members
Details
IV. Refusal to deal with an expelled member
Details
1. Refusal to deal by a trade association
Details
2. Execution of the refusal to deal by members of a trade association
Details
3. Execution of the refusal to deal by non-members
Details
V. Entering the premises of a recalcitrant industry actor without a warrant
Details
VI. Limiting adequate access to public courts prior to arbitral proceedings and after an award
Details
1. Voluntary nature of specialized commercial arbitration
Details
2. Recourse to national courts
Details
D. Rule-of-reason analysis under Article 101(1) TFEU
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I. Court of Justice of the European Union
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II. Commission
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III. Summary evaluation
Details
E. Key findings
Details
Chapter 10: Exemption under Article 101(3) TFEU
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A. Introduction
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B. BER: Research and Development and Specialization Agreements
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C. Assessment of pro- and anti-competitive effects under Article 101(3) TFEU
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I. First condition: efficiency gains
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1. The nature of the efficiencies claimed
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2. Sufficient link and likelihood and magnitude of the efficiency
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II. Second condition: consumer pass-on
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1. The scope of the term “consumers”
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2. Pass-on benefits (the concept of “fair share”)
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3. An efficient allocation of resources to countervail the negative effects of nonlegal sanctions imposed by the trade associations researched and executed by their members
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III. Third condition: Indispensability - without restriction, elimination or significant reduction of efficiencies
Details
1. Blacklisting
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a. The juxtaposition with online evaluation forums
Details
2. Membership rules and barriers for market access
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a. Withdrawal of membership
Details
b. Denial of readmission to membership
Details
3. Limiting adequate access to public courts prior to arbitral proceedings and after an award
Details
IV. Fourth condition: no elimination of competition
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V. Conclusion
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D. Key findings
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Chapter 11: Abuse of a Dominant Position under Article 102 TFEU
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A. Introduction
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B. The existence of a dominant position in the relevant market which impacts the EU territory
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I. Guidance by the CJEU and the decisional practice of the Commission
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II. The Discussion Paper
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III. The unequivocal dominance of the trade associations researched in the EU markets for regulation and private ordering
Details
C. The existence of an abuse of a dominant position in the market
Details
I. The current understanding of the “abuse” concept through an Ordoliberal lens
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1. The proof required for finding an exclusionary abuse
Details
II. The exclusionary abuse of refusal to grant access to an essential facility when the trade associations researched impose nonlegal sanctions
Details
1. Nature and characteristics of the facility
Details
2. The essentiality, indispensability or objective necessity of the facility
Details
3. Elimination of (effective) competition
Details
a. Blacklisting
Details
b. Membership rules and barriers for market access
Details
i. Withdrawal of membership
Details
ii. Denial of readmission to membership of expelled members on the basis of an additional entry condition
Details
c. Refusal to deal with an expelled member
Details
III. Existence of a causal connection between market power of the trade associations researched and an exclusionary abuse on adjacent second-tier commodities markets
Details
IV. “Objective justification” of the refusal to grant access to the facilities offered by the trade associations researched
Details
1. Efficiency defence: lower transaction and distribution costs?
Details
2. The protection of a legitimate commercial interest
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3. The objective necessity of an abuse
Details
D. Key findings
Details
429–474
Part IV: Summary, Conclusions and Best Practice Guidelines
429–474
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Chapter 12: A Succinct Summary of the Research
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A. A case study based review of present-day PLSs
Details
B. Similarities and differences between the trade associations researched
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C. The antitrust limits of nonlegal sanctioning
Details
D. Restraint of trade or commerce under Section 1 of the Sherman Act
Details
E. Monopolization of any part of trade or commerce under Section 2 of the Sherman Act
Details
F. The applicability of Articles 101 and 102 TFEU
Details
G. Anticompetitive agreement under Article 101(1) TFEU
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H. Exemption under Article 101(3) TFEU
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I. Abuse of a dominant position under Article 102 TFEU
Details
Chapter 13: Conclusions and Best Practice Guidelines
Details
A. An answer to the central research question
Details
B. Introductory comments to draft best practice guidelines for compliance with US Antitrust Law and EU Competition Law
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I. Differences between US Antitrust Law and EU Competition Law
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II. Outline of the best practice guidelines
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C. Best practice guidance for trade associations
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I. The dissemination of the names of wrongdoers in a blacklist
Details
II. Withdrawal of membership
Details
III. Denial of readmission of expelled members to membership on the basis of an additional entry requirement
Details
IV. Refusal to deal with an expelled member
Details
V. Entering the premises of a recalcitrant industry actor without a warrant
Details
VI. Limiting adequate access to public courts prior to arbitral proceedings and after an award
Details
D. Best practice guidance for the members of a trade association
Details
I. The dissemination of the names of wrongdoers in a blacklist
Details
II. Withdrawals of membership
Details
III. Additional entry barriers to being readmitted to membership after an expulsion
Details
IV. Refusal to deal with an expelled member
Details
V. Entering the premises of a recalcitrant industry actor without a warrant
Details
VI. Limiting adequate access to public courts prior to arbitral proceedings and after an award
Details
475–518
Bibliography
475–518
Details
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Nonlegal Sanctioning in Private Legal Systems , page 35 - 186
Part I: Framework and Research Question
Autoren
Jos van Doormaal
DOI
doi.org/10.5771/9783748926245-35
ISBN print: 978-3-8487-8164-5
ISBN online: 978-3-7489-2624-5
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