Professor Justus Haucap is founding director of the Düsseldorf Institute for Competition Economics (DICE), Germany’s leading academic think-tank on competition economics, and partner of DICE Consult. From 2006 to 2014 he was a member of the German Monopolies Commission and for four years also its chairman. He is a member of several advisory boards and has contributed his expertise in all areas of competition economics, including merger proceedings, abuse of market power and cartel damages.
What motivated you to specialise in competition economics?
After completion of my PhD on advertising and market organisation, I started working as an analyst for the New Zealand Treasury. One of my very first tasks, back in 1997, was to formulate the Treasury’s view on penalties, remedies and court processes under the NZ Commerce Act 1986 and the then-ongoing competition law reform in New Zealand. After that, I never left the fascinating field of competition law and economics again.
How has the market changed since you first started practising?
The market for economic consultancy services is still growing at a tremendous rate in Germany. Fortunately, we have seen more and more high-quality entry in recent times, with international firms locating in Germany. The level of debate has risen significantly.
What do clients look for in an effective competition economist?
Apart from being a smart economist, you need to be able to communicate in plain and simple English and, in Germany, especially in German. In Germany, you also need to understand the particularities of Germany’s competition law. If you fail to communicate your smart ideas to officials and judges, your client is lost.
How has your work as a university professor enhanced your work as a private practitioner?
At the Düsseldorf Institute for Competition Economics (DICE), we are now about 60 academics who work on competition matters. We have two seminars every week with high-level guest speakers, and we are always confronted with cutting-edge research, and new ideas and findings from around the globe. This is of invaluable help when dealing with practical cases.
Practitioners have noted that access to data and the sharing of information is an ongoing topic of discussion in the field. How are these issues impacting your private practice?
We are currently dealing with the first of these issues, where one firm is seeking access to another firm’s data. I am absolutely sure that we will see many more of these cases in the future, given the growing importance of data as a resource. We have also noted that many platforms face significant uncertainty about what data they can share with their users.
To what extent does German competition law need to evolve to meet modern developments in the digital economy?
I had the pleasure to be one of the co-authors (with Heike Schweitzer and Wolfgang Kerber) of the German report on how to adapt Germany’s competition law with respect to the abuse of market power. Our proposals – to facilitate third-party access to data; incorporate a concept of intermediation power for platforms into competition law; and shift the burden of proof when platforms with superior market power impede multi-homing – will very likely all be incorporated into Germany’s competition law in 2020. In addition, I think the Federal Cartel Office should adopt a more lenient approach to vertical restraints, especially dual pricing. The European Commission’s review of the guidelines on vertical restraints, and possibly on digital platforms more generally, will be an important opportunity to correct the enforcement practice where it is overly strict.
How would you like to see your practice develop over the next five years?
Our practice is growing at a steady pace. We are increasingly getting involved in very interesting merger cases and were rather successful in helping to get Remondis’ proposed acquisition of DSD blocked last year. I also expect that so-called section 20 cases – where firms may not be dominant but have relative market power in relation to their trading partners – become more important, especially in digital platform markets. Given that these cases are a German particularity, I suspect that German practices like ours are getting increasingly involved in these cases.
What advice would you give to younger economists hoping to be in your position one day?
First, come and study economics at DICE, since we are offering already highly specialised courses on competition law and economics during your master studies. Second, do internships at different places (agencies, consultancies, firms). Third, invest into econometrics and big-data analytics. Fourth, read a lot and write a lot. Fifth, work hard, but also party hard.
Justus Haucap is a standout figure in the German market who is well known for his strong academic knowledge of competition matters.
Professor Dr Justus Haucap is partner of DICE Consult and founding director of the Düsseldorf Institute for Competition Economics (DICE), the leading academic centre for competition economics in Germany. From 2006 to 2014, he was a member of the German Monopolies Commission, which advises the German government on competition policy and market regulation. Justus was the Commission’s chairman for four years. Since 2013, he has continuously been included in the list of Germany’s 30 most influential economists by the Frankfurter Allgemeine Zeitung.
Justus has advised private firms and public institutions in merger proceedings (such as Edeka/Tengelmann, VTI/CTG, EnBW/MVV and Remondis/DSD, among others), abuse of market power cases and private damage claims. Clients include Deutsche Telekom, Vodafone, Swiss Post, Siemens, RWE, EON, Telekom Austria, Shell and many others.
Justus studied economics at Saarbrücken (Germany) and Ann Arbor (Michigan, USA) and has previously held positions at the University of California at Berkeley, the New Zealand Treasury and various German universities. He is head of the competition working group of the German Economic Association; deputy chairman of the scientific working group for regulatory issues (WAR) of the Federal Network Agency; and a member of several other advisory boards.
Justus has published numerous papers on regulation and competition policy. Recently, he co-authored an influential report to the German government on options for competition law reform regarding the abuse of market power in digital markets.