Academic journal article Law and Policy in International Business

Antitrust and the Draft Hague Judgments Convention

Academic journal article Law and Policy in International Business

Antitrust and the Draft Hague Judgments Convention

Article excerpt

I. INTRODUCTION

Other countries have long resisted the extraterritorial application of U.S. antitrust law. Several have passed blocking statutes to hinder the discovery of evidence that might be useful in such cases.(1) The United Kingdom has provided, by legislation, that U.S. antitrust judgments are not enforceable in British courts, and both Australia and Canada have given their Attorneys General authority to declare such judgments unenforceable or to reduce the amounts that will be enforced.(2) Even when countries have not specifically provided for the non-enforcement of U.S. antitrust judgments, it is commonly assumed that such judgments would not be enforced because of what Professor Lowenfeld has referred to as the "public law taboo."(3) At first glance, then, it seems odd to find that the Hague Judgments Convention, in its current draft ("Draft Convention"), applies to antitrust cases.(4)

The explanation lies in the tact that the Draft Convention sets forth rules not just for the recognition and enforcement of judgments, but also for the exercise of personal jurisdiction, prohibiting the exercise of jurisdiction in some cases,(5) requiring it in others,(6) and neither prohibiting nor requiring it in the rest.(7) It takes no great insight to see that the reason Australia, Canada, most members of the European Union, and other parties to the Hague negotiations sought to bring antitrust within the Convention was not primarily to provide for the enforcement of those judgments, but to limit the jurisdiction of U.S. courts in antitrust cases.(8)

Putting to one side the fact that the United States is unlikely to accept such limitations,(9) this Article argues that the Draft Convention's attempt to limit personal jurisdiction in antitrust cases is ill advised for two reasons. First, the personal-jurisdiction limitations in the current draft are unlikely to provide an effective constraint on the extraterritorial application of U.S. antitrust law. Second, a better long-term strategy for the countries that have so long resisted the extraterritorial application of U.S. antitrust law would be to require the reciprocal enforcement of antitrust judgments without stringent limitations on personal jurisdiction. Currently, the United States has a much greater ability than other countries to project its antitrust law extraterritorially simply because of its size, which not only makes it easier for the United States to obtain jurisdiction over an antitrust defendant, but also makes it more likely that the defendant will have assets within the United States against which a judgment may be enforced. Providing for the reciprocal enforcement of antitrust judgments would give smaller countries(10) an equal ability to apply their antitrust laws extraterritorially, thus helping to level the playing field for negotiations on substantive antitrust policy. Of course, this argument assumes that smaller countries have antitrust laws and will sometimes wish to apply them extraterritorially, but both assumptions seem warranted.(11)

Part II of this Article briefly describes current law with respect to personal jurisdiction in antitrust cases and the enforcement of foreign antitrust judgments. Part III examines the provisions of the Draft Convention to see how it would change these rules. Finally, Part IV examines three possibilities from the perspective of a smaller country: (1) maintaining the status quo, under which there are no limitations on personal jurisdiction beyond those in national law and antitrust judgments from one country are not enforceable in another; (2) providing for the enforcement of antitrust judgments, but limiting personal jurisdiction in antitrust cases, as the Draft Convention unsuccessfully attempts to do; and (3) providing for the enforcement of antitrust judgments, but permitting personal jurisdiction on the basis of effects within the forum. The first of these is less than ideal from a smaller country's perspective because it would maintain the advantage the United States currently enjoys in antitrust enforcement. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.