A Study on the Power to Order Price Reversal (by the FTC) After Firms Engaging in Collusive or Abusive Pricing Behavior having been sanctioned

Abstract

In this project, we intend to explore the issue concerning whether the Fair Trade Commission (FTC) should have the additional authority to mandate a price reversal to the pre-violation level when the alleged non-competitive prices resulting from collusion or the abuse of the violators dominant market positions remain intact even after they have been punished and have ended their inappropriate competing behavior. We approached this issue by relying on the experience of the United States, Germany, and the European Union to examine whether this issue had ever been presented to and decided by the enforcement agencies and the courts in those countries. In particular, we focus on whether their experience could be translated into our legal system to support or disapprove the extension of the FTC's power to set the prices for industries not subject to rate regulations. In addition, whether private antirust litigation is capable of functioning equivalently as an alternative to price reversal in terms of the maintenance of market competition and the protection of consumers will also be elaborated upon in this project. We concluded our research by presenting tentative but concrete suggestions to the FTC on what could be done to resolve this issue, and in what manners.