Recent roundtable discussions include: Oligopoly Markets, Competitive Neutrality, Disruptive Innovations, Liner Shipping and Public and Private Antitrust Enforcement. See all other best practice roundtable discussions.Read more
OECD report provides recommendations on how to improve market studies practices in Chile, Colombia, Costa Rica, Mexico, Panama and Peru.Read more
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What are cartels and how do they affect consumers?
Hard core cartels (when firms agree not to compete with one another) are the most serious violations of competition law. They injure customers by raising prices and restricting supply, thus making goods and services completely unavailable to some purchasers and unnecessarily expensive for others.
The categories of conduct most often defined as hard core cartels are:
Challenges in detecting hard core cartels
Cartels are very difficult to detect. They can involve many firms in the industry and customers are rarely in a position to detect the existence of a cartel. Antitrust enforcers should be helped in their ability to detect cartels by various means and instruments, the most effective being leniency programmes. These programmes provide immunity or reduction in sanctions for cartel members that co-operate (or ‘whistleblow’) with competition enforcers. Leniency programmes have been adopted by most OECD countries and have been instrumental in increasing the success rate of the detection of cartels.
The best outcomes are secured by deterring firms from forming cartels in the first place. Strong sanctions are therefore a fundamental component of an effective antitrust enforcement policy against hard core cartels. An important supplement to fines against organisations for cartel conduct is sanctions against individuals for their participation in the conspiracy. These sanctions can take the form of substantial administrative fines or, in some countries, the criminal sanction of imprisonment. The prospect of incarceration can be a powerful deterrent for businesspeople considering entering into a cartel agreement.
But cartels are not always harmful...
Some horizontal agreements between companies can fall short of a hard core cartel, and in certain cases may have beneficial effects. For example, agreements between competitors related to research & development, production and marketing can result in reduced costs for companies, or improved products, the benefits of which are passed on to consumers. The challenge for competition authorities is how to assess these agreements, balancing the pro-competitive effects against any anti-competitive effects which may distort the market.
For further information related to the OECD work on cartels and anti-competitive agreements, please contact us at DAFCOMPContact@oecd.org.
Latest roundtables on cartels
Oligopoly markets, 2015
Bid rigging involves groups of firms conspiring to raise prices or lower the quality of the goods or services offered in public tenders. Although illegal, this anti-competitive practice continues to cost governments and taxpayers billions of dollars every year across OECD countries.
The OECD Guidelines for Fighting Bid Rigging in Public Procurement were developed to help governments design the procurement process so as to reduce risks of bid rigging and to detect conspirancies during the process.
Countries like Mexico and Colombia have already partnered with the OECD to improve procurement practices and step up their fight against bid rigging.
More on the OECD project on fighting bid rigging can be found at www.oecd.org/competition/bidrigging.
Permanent URL: www.oecd.org/competition/cartels
|Topics||Key materials, Tools & Guidance||Global Relations|
|Abuse of dominance & monopolisation||International co-operation|
|Cartels & anti-competitive agreements||Liberalisation & intervention in regulated sectors|
|Evaluation of competition interventions||Pro-competitive policy reforms|