The Allocation of Jurisdiction in International Antitrust

In this paper, we consider the organisation of international antitrust as an issue of institution design which involves a trade-off between an inadequate internalisation of external effects across jurisdictions and the risk of capture in a centralised agency. We focus on the first element of the trade-off and on merger control. We first point out that the current framework of public international law allows for wide discretion in the assertion of jurisdiction. We then consider various allocation of jurisdictions in a stylised model of international merger control which attempts to capture the essential features of the objectives being pursued and of the procedures being implemented in the major jurisdictions. We find that in this framework, much of the scope for conflict disappears. The fact that conflicts actually often arise in global industries must then be associated with the pursuit of objectives that antitrust authorities are not supposed to pursue. We also find that the allocation of jurisdiction matters surprisingly little for the final outcome.