Development Of Anti-monopoly Rules On Vertical Restraints Under The Perspective Of Competition Policy

Variety of microeconomics theories deriving from the complication ofvertical relation, as well as its conceptualization, causes thevolatility of competition policy in this area. In nineteen seventies,economists all over the world reached the consensus on the pros and consof vertical restraint. Unfortunately, lawmakers did not echo back theabove viewpoint. As a result, the gap of the level of deterrence andregulation technique among countries still remains. This paper will studyand discuss the factors influencing the making of competition policytowards vertical restraint, besides the consistency of its reality andnecessity.Here is the background which we will date back to nineteen fortiesand fifties after the WWII. Western developed countries transferredlabour intensive industries to developing countries and regions,including Japan, South Korea, Singapore and HK. In this process, thesecountries adopt export-oriented economic development strategy, andeventually thrived. The international industry transfer is regarded asthe beginning of the globalization. The author drew the following factors as the key elementssubstantially influencing the competition rules on vertical restraints,(1) the development of economic theory;(2) international competitionenvironment;(3) the prevalence of conglomerates;(4) the adoption ofeconomic development strategy;(5) domestic culture and value. Based onthe consolidation of different factors, two paths might be found abouthow the identifying of competition policy determines the competitionrules on vertical restraints:(1) The redirection of competition policyin developed market economies under the globalization determined thederegulation of vertical restraint;(2) In transition economies, theintervention policy (ex, industry policy) was eventually replaced by theweak-intervention policy (ex, competition policy) after the former lostits efficiency to promote the economy development. In this condition, thefeature of intervention policy, including conglomerate and concentratedmarket structure, became the significant obstacles for the effectiveenforcement of weak intervention policy, and caused the strict regulationtowards vertical restraint.In transition economies, the reform of market economy bringscompetition legislation and enforcement towards the vertical restraint.As to the developed economies, the emergency of social market economy fromtraditional free market economy brings the redefinition of globalcompetition, which eventually led to the deregulation of verticalrestraint. The above two paths move to the intersection, and we call it"neutralization", which is also the approach of the relationship betweengovernment and market.In conclusion, level of deterrence and regulation techniques invertical restrain area relies on the objectives of competition policy.