Trustbuster: Tougher measures needed to deter monopolies
'Currently, there are lots of very blatant violations of antitrust law, and they cause significant harm to competition and to consumers - but no sanctions are being imposed in response,' says Antitrust Commissioner David Gilo.
Firms will only follow antitrust laws insofar as they fear getting in trouble for not doing so, the country's top trustbuster told lawmakers, or rather one lawmaker, yesterday.
"If companies can violate antitrust law without being sanctioned they'll do it, since they can create immense profits at consumers' expense," Antitrust Commissioner David Gilo said at a Knesset Economics Committee meeting yesterday.
The committee was discussing a bill that would augment the authority of the commissioner, allowing him to fine companies 10% of their turnover, capped at NIS 30 million.
Out of the 13 permanent committee members and the 5 temporary members, only one Knesset member was present for yesterday's meeting - committee chairman Carmel Shama-Hacohen.
As the bill progresses, Knesset members are likely to start facing pressure from lobbyists working for businesses that object to the reform.
During the meeting, someone suggested that the chairman should be obliged to consult with the Antitrust Authority's committee on mergers before imposing fines.
Gilo said he did not have a problem with this.
The committee's next discussion on the matter is set for February.
Gilo emphasized that change was needed.
"Currently, there are lots of very blatant violations of antitrust law, and they cause significant harm to competition and to consumers - but no sanctions are being imposed in response.
"They include monopolies abusing their ability to destroy competitors in order to keep on charging monopoly prices, as well as monopolies charging monopoly prices, which is the ultimate evil that the antitrust law is trying to prevent," he said.
By law, a company that controls at least 50% of a given market is considered a monopoly.
"It's nearly impossible to launch criminal proceedings over these violations, because no sanctions exist [in law], and as a result monopolies and other companies don't hesitate to violate the law due to the huge profit potential," said Gilo.
Like us on Facebook and get articles directly in your news feed