After the global financial crisis: key competition law developments in Australia, the United States, the EU and the UK

Abstract

This article has been written by way of follow-up to an article entitled ‘The Impact of the Global Financial Crisis on Competition Policy in the Australian Banking Sector' (2009) 3 Law and Financial Markets Review 449. As discussed in that article, responses to the global financial crisis included government bailouts of institutions (largely but not limited to those in the banking and financial sector); the provision of cash injections into financial systems to keep credit flowing; the encouragement of mergers in the financial sector resulting in the creation of “mega banks”; requiring competition authorities to “relax” enforcement of competition rules in the interest of financial stability. This meant that political pressure became increasingly influential for the implementation of competition law and policy. For example, the European Commission was essentially forced to shift its policy on the application of state aid rules in relation to financial institutions in response to rescue measures taken by European governments to support their financial sectors. Australia was luckier than most countries, in that the strength of its domestic economy and banking sector helped it to withstand the severity of the impact of the crisis. However, Australian markets were also affected. This article now examines how Australia and other key jurisdictions (notably the United States, the European Union and the United Kingdom) have responded to the global financial crisis, and focuses particularly on competition law responses to the crisis.