Analysis of a current competition investigation

Disponible uniquement sur Etudier
  • Pages : 26 (6453 mots )
  • Téléchargement(s) : 0
  • Publié le : 19 juillet 2010
Lire le document complet
Aperçu du document
Analysis of a Current Competition Investigation

Monsanto

[pic]

Contents

Introduction…………………………………………………………………………………………………………3

I The market in agricultural biotechnologies and its evolution………………………………4

A. Agricultural Biotechnologies as an oligopolistic market………………………….4
1) Presentation of the Supply side………………………………………...…………….4
2)Presentation of the Demand side………………………………………………...….4

B. Evolution of the market since the mid 90's……………………………………………….5

C. Legislation concerning Patents and its impact on the market………….…….….6
1) Historical aspect of patent protection for plants……………………………..6
2) Effects of legislation and distribution of patents amongcompanies…………………………………………………………………………………...…7

Conclusion of part I : Monsanto's dominant position on the US market
for agricultural biotechnologies………………………………………………………………………..…....8

II Competition issues………………………………………………………………………………………..…..9

Has Monsanto exercised its market power to foreclose rivals
from market access ?...................................................................................................................................9
1) Effects ofmergers………………………………………………………………..…….10
2) Licencing agreements…………………………………………………………….…..11

Has Monsanto's policy slowed innovation and affected prices,
quality, and choice for farmers ?...........................................................................................13
Inter and intra platform competition and effects onInnovation……………………………………………………………………….……….13
2) Effects on farmers…………………………………………………………….……….14

Tension between antitrust law and patent law, having
repercussions in terms of competition……………………………………………………15

Conclusion…………………………………………………………………………………………………...……..16

Bibliography……………………………………………………………………………………………………….17

Introduction

In october, 2009, the American Department of Justice launched an inquiry in order to determine whetherMonsanto has violated competition laws. This investigation takes place in a broader context of analysis of the agricultural market ; the US Departments of Agriculture and Justice (Antitrust Division) have jointly set up the first workshops focussing on competition in agriculture : "Agriculture and Antitrust Enforcement Issues in Our 21st Century Economy ".
The first of these workshop took place inmarch.

A paper by Diana Moss, from the American Antitrust Institute, summarises the concerns in the agricultural biotechnology market : "What would likely be the centerpiece of any antitrust investigation into Monsanto’s practices is whether the agricultural biotechnology giant has exercised its market power to foreclose rivals from market access, thereby slowing innovation and adverselyaffecting prices, quality, and choice for farmers and ultimate consumers of seed products". The report also insists on the fact that there is an important tension between antitrust law and patent law, having repercussions in terms of competition.

The investigation takes place on the US agricultural biotechnology market. This market can be defined at three levels : innovation, creation of traitsand development and distribution of seeds (the three levels of integrated plateforms as we will define them in the paragraphs to come). It includes several types of plants, the most important beeing soybeans, corn and cotton.

The two main questions the autorities face are whether Monsanto has used its position to forclose rivals from markets, and whether the use of patents by the company isconform with competition.

Since this investigation is under scrutiny and has started recently, I have organized my work around the results of the first workshop, a paper provided by Monsanto for the investigation and several papers from independant organisms.

I The market in...
tracking img