UK: Competition Keeps A Keen Eye On B2B Exchanges

By Richard Meares Industry moguls have hatched many a cartel on the golf course, but now competition authorities are watching closely to make sure they do not take their game online.Old-economy industries have been urged to embrace the Internet, which many are now doing. But, one aspect of this nascent e-business that anti-trust authorities are watching closely is the trade exchange, where buyers or sellers in apparel, textiles, aviation, or any industry join to cut costs and do business more efficiently."There are very real competition issues here," said Brian Sher, a competition lawyer with international law firm Linklaters & Alliance.If most of the world's aircraft makers get together, for example, they could dictate prices to their suppliers. The Net makes doing this far easier technically than it ever has been.If such practices abound, an obscure word may enter the wider vocabulary - monopsony, where market power is held by buyers, rather than the sellers who have had the upper hand in the past through monopolies."Price fixing is going to be the thing that is subject to most suspicion. Any forum in which competitors meet could be used for joint bids or to swap information or to discuss prices," said Tim Frazer, a lawyer at Arnold & Porter in London.