Optimal Pre-Merger Notification Mechanisms : Incentives and Efficiency of Mandatory and Voluntary Schemes
The authors compare the two merger control systems currently employed worldwide: a mandatory system based on merger size threshold and a voluntary system with ex-post monitoring and fines. The voluntary system possesses two informational advantages...
| Main Authors: | , |
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| Format: | Policy Research Working Paper |
| Language: | English |
| Published: |
2012
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| Subjects: | |
| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090519085418 http://hdl.handle.net/10986/4130 |
| Summary: | The authors compare the two merger
control systems currently employed worldwide: a mandatory
system based on merger size threshold and a voluntary system
with ex-post monitoring and fines. The voluntary system
possesses two informational advantages: (i) the enforcement
agency employs more information -verifiable and non
verifiable parameters- to decide the set of mergers to
investigate, and (ii) the first move of merging firms
reveals useful information to the agency about the
competitive risk of a merger. If fines for undue omission to
notify are upward limited, then a mixed mechanism is
optimal, where small transactions are under a voluntary
regime while the big mergers are obliged to report. Remedies
for fixing anticompetitive mergers act as an instrument that
induces firms to notify the operation, improving further the
advantage of the voluntary mechanism. |
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