IDEAS home Printed from
   My bibliography  Save this paper

European competition policy modernization : from notifications to legal exception


  • Frédéric Loss

    (Laboratoire d'économétrie - CNAM - Conservatoire National des Arts et Métiers [CNAM])

  • Estelle Malavolti

    () (LEEA - ENAC - Laboratoire d'Economie et d'Econométrie de l'Aérien - ENAC - Ecole Nationale de l'Aviation Civile)

  • Thibaud Vergé

    (Laboratoire d'Economie Industrielle - CREST-INSEE)

  • Fabian Bergès-Sennou

    (INRA - INRA - Institut National de la Recherche Agronomique)


Council Regulation (EC) 1/2003 came into force in May 2004 and replaced the mandatory notification of agreements by a regime of ex post monitoring. This paper shows that ex post monitoring is the optimal audit regime when the competition authority's probability of error is low. On the other hand, the notification system becomes optimal when the competition authority's probability of error is high. The paper also shows that block exemptions and black list (regimes of per se (il)legality) should be implemented when the agreements' expected welfare impact is very high and very low, respectively.

Suggested Citation

  • Frédéric Loss & Estelle Malavolti & Thibaud Vergé & Fabian Bergès-Sennou, 2008. "European competition policy modernization : from notifications to legal exception," Post-Print hal-01021575, HAL.
  • Handle: RePEc:hal:journl:hal-01021575
    DOI: 10.1016/j.euroecorev.2007.02.001
    Note: View the original document on HAL open archive server:

    Download full text from publisher

    File URL:
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    1. Barros, Pedro Pita, 2003. "Looking behind the curtain--effects from modernization of European Union competition policy," European Economic Review, Elsevier, vol. 47(4), pages 613-624, August.
    2. Besanko, David & Spulber, Daniel F, 1993. "Contested Mergers and Equilibrium Antitrust Policy," Journal of Law, Economics, and Organization, Oxford University Press, vol. 9(1), pages 1-29, April.
    3. Motta, Massimo & Polo, Michele, 2003. "Leniency programs and cartel prosecution," International Journal of Industrial Organization, Elsevier, vol. 21(3), pages 347-379, March.
    4. Reinganum, Jennifer F. & Wilde, Louis L., 1985. "Income tax compliance in a principal-agent framework," Journal of Public Economics, Elsevier, vol. 26(1), pages 1-18, February.
    5. David P. Baron & David Besanko, 1984. "Regulation, Asymmetric Information, and Auditing," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 447-470, Winter.
    6. Winand Emons, 2004. "Subgame-Perfect Punishment for Repeat Offenders," Economic Inquiry, Western Economic Association International, vol. 42(3), pages 496-502, July.
    7. Petros C. MAVROIDIS & Damien J. NEVEN, 2000. "The Modernisation of EU Competition Policy : Making the Network Operate," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 00.17, Université de Lausanne, Faculté des HEC, DEEP.
    8. Emons, Winand, 2007. "Escalating penalties for repeat offenders," International Review of Law and Economics, Elsevier, vol. 27(2), pages 170-178.
    9. Picard, Pierre, 1996. "Auditing claims in the insurance market with fraud: The credibility issue," Journal of Public Economics, Elsevier, vol. 63(1), pages 27-56, December.
    10. Besanko, David & Spulber, Daniel F, 1989. "Antitrust Enforcement under Asymmetric Information," Economic Journal, Royal Economic Society, vol. 99(396), pages 408-425, June.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Christian Growitsch & Nicole Nulsch & Margarethe Rammerstorfer, 2012. "Preventing innovative cooperations: the legal exemptions unintended side effect," European Journal of Law and Economics, Springer, vol. 33(1), pages 1-22, February.
    2. Thibaud Vergé & Estelle Malavolti-Grimal & Frédéric Loss, 2007. "Comment décentraliser la politique européenne de concurrence ?," Économie et Prévision, Programme National Persée, vol. 178(2), pages 115-124.
    3. repec:hal:journl:halshs-00113503 is not listed on IDEAS
    4. repec:kap:ejlwec:v:44:y:2017:i:1:d:10.1007_s10657-014-9459-7 is not listed on IDEAS
    5. Cosnita-Langlais, Andreea & Tropeano, Jean-Philippe, 2012. "Do remedies affect the efficiency defense? An optimal merger-control analysis," International Journal of Industrial Organization, Elsevier, vol. 30(1), pages 58-66.
    6. Will, Birgit E. & Schmidtchen, Dieter, 2008. "Fighting cartels: some economics of council regulation (EC) 1/2003," CSLE Discussion Paper Series 2008-02, Saarland University, CSLE - Center for the Study of Law and Economics.
    7. Andreea Cosnita-Langlais & Jean-Philippe Tropeano, 2013. "Ex post or ex ante? On the optimal timing of merger control," EconomiX Working Papers 2013-22, University of Paris Nanterre, EconomiX.
    8. Ottaviani, Marco & Wickelgren, Abraham L., 2011. "Ex ante or ex post competition policy? A progress report," International Journal of Industrial Organization, Elsevier, vol. 29(3), pages 356-359, May.

    More about this item


    competition policy; imperfect audit;

    JEL classification:

    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hal:journl:hal-01021575. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (CCSD). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.