Antidumping and Competition Policy

There are increasing calls from various quarters for the World Trade Organization (WTO) to be the forum for discussions on developing any eventual multilateral framework for competition policies. There would seem to be several conclusions we might draw from the initial discussions. The first, obvious conclusion is that there is considerable difference of opinion over the various topics that we have discussed, and it seems very unlikely that these will be reconciled. This is nothing new. What is new is that although differences remain, in a number of instances these differences appear less extreme than they have in the past. The second conclusion, and probably the most important one, is that whatever system of international competition rules may be proposed must not only be based on theoretical merits, but also be realistic in practice. While there has been some recognition of practical issues in the discussion on this topic, much of the debate has centered more on conceptual merits. The practical problems involved in pursuing any international competition code clearly are quite substantial and should be given much more thought and consideration in any future discussions. Any proposal to create an international competition code must answer these practical considerations in a concrete and precise way. A third conclusion that may be drawn from the initial discussions is that any proposal for changes with respect to international competition, whether or not it alters or replaces antidumping, would need to set forth very clearly the conceptual underpinnings on which it is based. For example, some clear understanding of the goals to be promoted -- such as consumer interests, efficiency, or competition -- would need to be developed, and these concepts would in turn need to be clearly defined. In terms of where the discussion has led us with respect to policy ideas, I think, first, that it is largely agreed that attempting to construct an international competition code might be premature and perhaps counterproductive at this time. Thus, for the time being, international efforts might best be directed at voluntary cooperation, information sharing, and mutual assistance and discussion among countries, which, over the long term, could lay the foundation for further and more ambitious work in the future. Second, regardless of our continuing differences on substance with respect to antidumping, it is agreed that for the time being, to the extent changes are deemed necessary, they might most constructively be pursued at the unilateral, national level. I. Introduction The subject of antidumping and competition policy is very complex, generating a broad spectrum of opinion. It is clear, first of all, that there is a natural relationship between some aspects of these two areas. For example, both can address price discrimination. Both can address sales below cost. The purpose of measures taken under both types of policies is to restore balance, however defined, to a market situation that is deemed distorted in some way. These and other basic similarities do not, however, obscure the fact that there also are important differences of substance, emphasis, and practice between the two areas. Of course, different people interpret the significance of these similarities and differences in different ways. These differing interpretations in turn give rise to different policy prescriptions. There are those who see major flaws in antidumping rules and practice in terms of their effect on competition, and who thus tend to argue for a sweeping overhaul of antidumping, going as far as replacing it outright by competition policy. On the other hand, there are those who believe that competition policy is inferior, from an economic standpoint, to antidumping, and who therefore believe that such replacement is neither necessary nor desirable, and that any replacement or supplementation should go in the opposite direction. …