Effective Strategies for an International Agreement Regulating Cartels

Approaches for binding international multilateral agreement regulating cartels have faced continued failures, thereby being satisfied with non-binding multilateral agreements regulating cartels. Meanwhile, bilateral agreements or FTAs including cartel regulations or competition chapter have gained popularity. In spite of innate weaknesses of bilateral agreements, they can contribute to building and spreading consensus in advantages of competition regime. Through incorporating competition chapter and cartel regulation, bilateral agreements or FTAs can work as a foundation for a plurilateral cartel-regulatory competition agreement on the basis of procedural cooperation. When the plurilateral agreement attract countries with interests in operating competition law, a short-term approach, a binding multilateral agreement regulating bid-rigging, will work effectively as most countries punish bid-rigging with criminal sanctions. The focus of the binding multilateral agreement can be extended to cover price-fixing, production-limitation, and market-allocation when member countries approve. Finally, a binding multilateral agreement regarding competition shall be introduced so as to support the multilateral cartel-regulatory agreement. In the light of the lack of consensus regarding competition law, a principle-based and cooperative-procedured agreement will be more desirable. Concessions for developing countries in substantive and procedure law will be provided.