Page 85 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE

The first step in determining an appropriate remedy is to consider

whether a case involves premeditated, flagrant anticompetitive conduct (say,
harassment or threats of violence to potential entrants) or merely involves

conduct that has restricted competition unnecessarily but is not morally

offensive or beyond the normal standards of business behavior. If it is the first,
then it may be appropriate to seek fines or other punitive sanctions if the

relevant legislation permits such remedies. In situations of outright criminal
conduct, competition agencies should consider requesting the help of police or

other competent authorities and bringing appropriate criminal charges.
If a case does not involve an anticompetitive intent, however, or if

there is no evidence of such intent, then fines or imprisonment are not

appropriate. Rather, it is simply a question of finding the most efficient way
to reverse the anticompetitive effects. In many cases the appropriate measure

will be a prohibitive order that requires the firm or firms to cease engaging in

the alleged conduct. To the extent permitted by legislation, the agency may
consider seeking a proactive but essentially behavioral remedy, such as

requiring the compulsory licensing of technology or the provision of access
to essential facilities to establish competition in markets in which it had been

suppressed. Or, the agency may seek structural measures by actually
breaking up the firm.

In designing and implementing such remedial measures, care must be

taken to avoid imposing greater costs than those incurred by the
anticompetitive conduct. For example, the most effective way to establish

competition in a market may be to break up a dominant firm. If this remedy
would prevent the realization of overwhelming economies of scale, however,

then it would not be a responsible remedy for any agency to seek. Similarly,
an investigation may determine that vertical market restraints (for instance,

tied selling or exclusive dealing) have prevented the beneficial entry into a

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