Legal and economic interfaces between antidumping and competition policy

Includes bibliography

Introduction The interaction between antidumping and antitrust is a polemic issue in every integration process for both legal and economic reasons. From a legal perspective, antidumping rules allow practices such as price undertakings and quantitative trade restrictions that are forbidden by competition law, and punish certain types of price differentiation that are justifiable under the antitrust rules. From an economic viewpoint, the two policies pursue different objectives that eventually may lead to conflicting situations. Antidumping is a trade remedy for industries injured by import competition. The final goal of antitrust is to promote consumer welfare and productive efficiency, which in part depend upon market contestability, wherein import competition often plays a key role. This paper addresses several issues from three complementary perspectives. Section 2 summarizes the current debate about antidumping rules in the United States. This debate includes a large and growing academic literature that has been surveyed recently by Blonigen and Prusa (2001), papers and speeches by influential personalities such as Kenneth Dam, Alan Greenspan and Joseph Stiglitz, and the active participation of business associations, lawyers, lobbyists and politicians. This diverse collection of policy suggestions provides a normative background for the discussion in the rest of the paper. Section 3 reviews the instruments used by the European Union and the U.S. government for reconciling a strong enforcement of competition laws with an intense use of antidumping measures. Section 4 highlights some peculiarities of the FTAA process. Section 5 presents the main conclusions.