Abstract
This paper looks at the issue of antibiotic-resistant bacteria by focusing on the present data, ways on how this condition arises and finally proposing ways of how to overcome this problem.
Introduction
The discovery of antibiotics brought a new victory in fighting bacteria which were major causes of diseases. With time some of these bacteria have undergone through genetically changes or mutations which have made them resistant to antibiotics. According to the current data, in 2005, resistant Staphylococcus aureus was responsible for over 18,000 deaths and close to 94, 000 infections (Saver, 26). This concern spreads over other strains of bacteria necessitating for a further study.
Materials and Methods
Study methods involve the exposure technique where given stains of bacteria are exposed to varying levels of antibiotics and their level of resistant to successive treatments with antibiotics observed. In regard to this some of the major cause of resistance has been the partial exposure of these bacteria to antibiotics which makes their body develop a mechanism to fight the antibiotic.
Among these includes the lack of completion of a given treatments to antibiotics, haphazard use of antibiotics and even the use of antibiotics for other uses like growth control (Purdom, 1). Other reasons include the frequent exposure to different strains of bacteria through travel. Hospitals have also become a breeding ground of antibiotic resistant bacteria.
Results
It has been found that most of the resistant bacteria have developed their resistance to major antibiotics. The effect of prolonged exposure to the bacteria in the food chain has contributed very much to the growth of resistance to antibiotics within the bacteria even before they reach to our system (Todar, 1).
Discussion
Among the best ways to reduce the antibiotic resistance includes the reduction for unwarranted prescriptions by clarifying whether the infection at hand is actually a bacterial infection. We are also supposed to reduce the use of antibiotics in areas where they come into contact with the food chain. It is also advisable to complete the dose given to avoid strengthening of the bacteria already within the system. One should also put into play an improved hygiene.
However, there are some approaches which have been known not to work in controlling the explosion of antibiotic-resistant bacteria among them is the use of a high doses to treat an already resistant strain. This in turn ends up increasing the level of resistance within the bacteria.
Works Cited
- Purdom G. Antibiotic Resistance of Bacteria: An Example of Evolution in Action? 2009 Viewed August 24 2010 from <http://www.answersingenesis.org/articles/am/v2/n3/antibiotic-resistance-of-bacteria>
- Saver, R. In Tepid Defense of Population Health: Physicians and Antibiotic Resistance. American Journal of Law and Medicine. Vol. 34, p. 24-28, 2008
- Todar, K. Bacteria Resistant to Antibiotics. 2008. Viewed August 24 2010 from <http://www.textbookofbacteriology.net/resantimicrobial_2.html>
Problem Of Antibiotic Resistance And Ways To Overcome It
Antibiotic Resistance
Ever since the advent of penicillin by Alexander Fleming, antibiotics have played a pivotal role in combating against the various bacterial infections which affect the human race (Lewis, 1995). Most of the World War 2 veterans owe their lives to the timely use of antibiotics. These antibiotics have revamped the way medicine is practiced. We now have ways to address and combat the issue of infection at almost all the areas that it involves. Bacteria are divided into gram positive and gram negative along with being either acid fast bacilli. The various bacteria which are present on the human body can be classified as either commensals or infectious agents. The commensals or the normally occurring bacteria present on the body are naturally harmless, but their growth if disturbed might lead to disorders. The disorders might consist of a simple oral thrush to pseudo membranous colitis, depending upon the degree and extent of the damage to the normal commensular organisms. Bacteria may use the lysogenic pathway which may enable them to complete their life cycles. This is then responsible for the destruction of the host cells.
Of the plethora of problems facing physicians the question of antibiotic resistance is a constant threat and it is the cause of concern for the millions of scientists working around the globe .Bacteria are said to be resistant to an antibiotic if their growth is not inhibited by the maximal level of that antibiotic that can be tolerated by the host. Some organisms are inherently resistant to an antibiotic. However microbial species that are normally responsive to a particular drug may develop more virulent, resistant strains through spontaneous mutation or acquired resistance and selection. Some of these strains may become resistant to more than one antibiotic. Antimicrobial drugs can be classified in a number of ways, either by their chemical structure, their mechanism of action or by their activity against several different types of organisms.
Before discussing as to what causes antibiotic resistance it would be prudent to delve on the fact as to how the antibiotics act to combat bacterial infections. Antibiotics are either bacteristatic or bactericidal on the basis of their mechanism of action. What does this signify, it means that the drug might kill the bacteria altogether or may cause its cell division to stall. The complete eradication of bacteria is desirable in some areas while in others the most questions is to stop its growth and in such cases we have the two different classes of antibiotics.
Along with antibiotics comes the resistance of bacteria to these antibiotics and comes the question of antibiotic resistance. The scare of antibiotic resistance has risen ever since these drugs have been prescribed on a day to day basis.
There are four major mechanisms which lead to bacterial resistance : 1 ) Bacteria produce enzymes that inactivate the drug egg Beta lactamases can inactivate penicillin’s by cleaving the beta lactam ring (2) Bacteria synthesize modified targets against which the drug has no effect eg mutant proteins can act to counter the effect of streptomycin (3) Bacteria may decrease their permeability such that an effective intracellular concentration of drug is not achieved ( 4) Bacteria actively export drugs using a multi drug resistance pump. (Anderson, 2005)
Most drug resistance is due to a genetic change in the organism. These and other mechanisms act to simulate the various procedures whereby which a bacteria produces a resistance to an antibiotic. Hospital acquired resistance is due to the nosocomial infections. The recent scare of MRSA or methicillin resistant staphylococcus aureus in UK hospitals has provided sufficient food for thought.
The various bacterial strains present in the hospital environment account for the multitude of resistant strains being produced. Wide spread use of antibiotic use is responsible for this menace. Common among them are staphylococcus aureas and enteric organisms such as E- coli and pseudomonas aureginosa. Hospital strains are resistant to multiple antibiotics .The answer to these problems lies in the newly developed drugs such as vancomycin and Chloramphenicol , which have been developed with the aim of adopting to a new line of drugs which may combat infections which are not been addressed by the antibiotics being used in the daily practice .
The hospital acquired infections can be prevented by limiting the stay in the hospital and not using unspecific antibiotics as prophylaxis, rather the patients who are preoperative need to be assessed regularly and those who are fit otherwise should not be prescribed antibiotics unnecessarily. Certain clinical situations require the use of antibiotics for the prevention rather than treatment of infections. Because the indiscriminate use of antimicrobial agents can result in bacterial resistance and super infection, prophylactic use is restricted to clinical situations in which the benefits outweigh the risks. The duration of prophylaxis is dictated by the duration of the risk of infection. (Todar, 2002)
The other mechanism of acquiring resistance encompasses either chromosome mediated resistance or plasmid mediated resistance. Of the non genetic basis of resistance includes the fact that the bacteria can be walled off within an abscess cavity which the drug cannot penetrate effectively, or the bacteria can be in a resting state.
In some cases organisms that would be killed by penicillin can loose their cell wall and serve as protoplasts and become insensitive to cell wall active drug, if a wrong antibiotic is prescribed then it may also presumably show that the bacteria are resistant to the used antibiotic, when in fact it is just not being combated by the proper antibiotic.
Some examples of major bacterial species and the drugs against which they have developed resistance include in case of gram positive cocci, Staphylococcus aureus, streptococcus pneumonia and enterococcus feacalis, which have developed resistance against penicillin. Then in the category of gram negative cocci Neisseria gonorrhea has also developed resistance against penicillin-G, in case of gram negative rods Haemophilis influenza has developed resistance to ampicillin, while pseudomonas and enterobacteriacae have acquired resistance against beta lactam antibiotics and aminoglycosides (Lewinson, 2004).
Another group which has developed resistance is that of mycobacterium i.e. tuberculosis, which is the reason of failure of therapy in case of a case of tuberculosis. These are some of the examples of the bacteria which have acquired resistance against the major antibiotics. According to a study by the methicillin resistant staphylococcus is a source of constant threat to hospital authorities. In case of UK this has resulted in an outbreak. In the US due to the strict practices of culture and sensitivity tests this has been controlled to a large extent but the problem can resurface if appropriate control measures are not undertaken.
Speaking of tuberculosis, which used to be a major killer disease and is still affecting millions around the globe in the third world countries, the issue of drug resistance is of major concern. The DOTS or directly observed treatment strategy, initiated by WHO in the developing countries is a step to safeguard against the development of drug resistant strains of tuberculosis (Davidson, 2005). A total of 4 drugs are used in combinations for duration of 6-9 months depending upon the condition and compliance is ensured by the nurse providing the dosage.
This leads us to the question of the link between compliance and drug resistance. What really happens is that if a drug is taken in meager amounts or if it is not taken in the correct dosage then it is rendered harmless for the bacteria and bacteria in turn develop resistance against it. The same is the concept of using several drugs at a time, in this way there is a less chine of development of resistance because a backup drug is always there to ensure eradication of the bacteria in case the first drug fails to control the infection.
In case the first line drugs fail then there is the possibility of using a second array or generation of drugs. In this manner the chances of a resistance developing against any drug is lessened to a considerable extent. But the problem is that the adverse effects or complications may arise too e.g. hypersensitivity may develop or toxicity and worst of all super infections. Now how can this problem be addressed, the core of the problem lies in not giving too much attention to the cases of infection when they first appear and haphazardly prescribing antibiotics.
It is generally observed that the general practitioners tend to give broad spectrum antibiotics to their patients when they first come to them for a minor ailment. This rampant use of antibiotics is one of the reasons of development of resistance. What the protocol demands is the investigation of every case on the lines of methodical approach. This involves careful screening through tests and then referral for the culture and sensitivity report.
What is basically a culture and sensitivity report? It consists of an agar plate on which antibiotics are present covering a small area. Several antibiotics are present, now a culture which grows on the medium when subjected to an antibiotic it is sensitive to results in an area of either decreased or no growth. This helps in pointing out the specific antibiotic to which an organism is resistant. The results are commonly reported as minimum inhibitory concentration, which is defined as the lowest concentration of drug that inhibits the growth of the organism.
The MIC is determined by inoculating the organism isolated from the patient into a series of tubes or cups containing 2-fold dilutions of the drug. After inoculation at 35 degrees centigrade for 18 hours, the lowest concentration of the drug that prevents visible growth is the MIC. A second method of determining antibiotic sensitivity is the disc diffusion method, in which disks impregnated with various antibiotics are placed on the surface of an agar plate that has been inoculated with the organism isolated from the patient. After incubation at 35 degrees for 18 hours, the diameter of the zone of inhibition is determined. The size of inhibition is measured with standards to determine the sensitivity of the organism to the drug.
Reports obtained or cultivated in this manner provide the physician a guideline for the correct use of the antibiotics. In case of pediatric practice there are certain rules and guidelines which govern the use of antibiotics such as in case of tachycardia or fast breathing a child is evaluated according to certain parameters. Only if a child falls within the category of pneumonia is he prescribed antibiotics. And that too are prescribed according to the culture and sensitivity report.
Until the report is pending generally a broad spectrum antibiotic is started, but only after confirming that the child has got bacterial infection is an antibiotic prescribed. The use of combination antibiotics has stepped in to solve this problem of drug resistance.
In most cases the single best antimicrobial agent should be selected for use because this minimizes the side effects; however there are several instances in which two or more drugs are commonly given. In order to treat serious infection before the organism is known, In order to achieve a synergistic inhibitory effect against certain organisms and to prevent the emergence of resistant organisms (Richard, n.d.).
Two drugs can interact in one of several ways. They may be indifferent to each other or there may be a synergistic effect, in which the effect of the two drugs together is significantly more than that of a single drug alone. A synergistic effect can result from a variety of mechanisms e.g. the combination of Ampicillin and Clavaluic acid results in the action against gram positive bacteria as well as beta lactamase producing microbials as well.
This results in the prescription of a single dose which is sufficient to combat the infection causative organisms .It should be kept in mind that a bacteristatic antibiotic is not prescribed along with a bactericidal antibiotic as this might result in an antagonism and there would be no effect what so ever of the drug prescription.
According to an article (Anderson, 2005) the increased prevalence of antibiotic resistance is an outcome of evolution. It has also been stressed that the improvement in the public health measures a go a long way in prevention against infection. Here comes the vital point of prevention, which is the basis of modern medicine. This is what around which the public health system evolves. Prevention of an infection in the first place is our guaranteed guard against any bacterial invasion.
The effective and timely use of vaccine has also been advocated as a means to combat bacterial infections. Now one of the questions is that if Vancomycin resistant bacteria are also a constant threat and measures need to be adopted to cultivate safe drug practice among physicians. Physicians and pharmaceutical industries together can combat this menace of antibiotic resistance in a very positive manner. The need is to address this problem on a broader spectrum and to rationalize the use of antibiotics. This is the only chance before we have to face an era where we will need to find new ways to combat infection instead of the trusted and time tested use of antibiotics.
Antibiotic resistance is to be avoided by following the principles of health management (Barbara E. Murray, 1994). Whereby it is mandatory to enforce steps to find the problem, assess the problem and alleviate the problem. Modern pharmaceutical companies are constantly striving to make their utmost effort in the manufacture of antibiotics. Careful planning and integration is vital if we desire that this issue be addressed amicably. Most cases of diarrhea among children are caused by a virus, termed as the rota virus, thus there is no use what so ever in prescribing any antibiotic.
The future lies in expanding the horizons of our intellect and to look beyond what we term as possible, but we need to bear in mind the ethical issues , the broadening gap between the developed and the under privileged . The scope of modern technological advancements is quite broad and everyday new antibiotics are emerging which offer hope to the millions of people around the globe in search for the cure of the bacterial infections. Being able to comprehend the true potential of these advancements and being able to use them for the betterment of mankind along with improving the quality and not merely the quantity of life is what can be considered the ultimate reward.
References
Barbara Murray, (1994) Antimicrobial resistance, M.D., of the University of Texas Medical School at Houston, New England Journal of Medicine
Kenneth Teodar, (2002) Bacterial resistance to antibiotics
http://Textbookofbacteriology.Net/Resantimicrobial.Html
Accessed, July 24, 2007
Davidson’s Principles and practice of medicine 19th edition (pg147-164)
Kevin Anderson, (2005) Is bacterial resistance an example of evolutionary change
www.Trueorigin.Org/Bacteria01.Asp Accessed, July 24, 2007
Warren Lewinson, (2004) Microbiology and Immunology (pg 54-75)
Richard Howland, (n.d.) Pharmacology, Lippincot Illustrated reviews 3rd edition (pg 341-350)
Riki Lewis, (1995) The Rise of Antibiotic-Resistant Infections
http://Www.Fda.Gov/Fdac/Features/795_Antibio Accessed, July 24, 2007
Case Law Of The CFI And ECJ And The Anti Cartel Enforcement Policy
Introduction
Fighting cartels is one of the most important objectives of the Commission. Cartels are akin to cancerous tumours on the open market economy, which forms the basis of the Community. By destroying competition they cause serious harm to economies and consumers. Further, cartels undermine the competitiveness of the industry involved, because they eliminate the pressure from competition to innovate and achieve cost efficiencies. Recent anti-cartel actions of the Commission demonstrate that despite the best of efforts cartels continue to exist. It has to be borne in mind that cartels are secret and therefore difficult to uncover and hence their number cannot be estimated exactly.
The EU competition policy is based on three closely related mainstays, which bring the benefits of effective competition to the consumer and enhance the competitiveness of European industry. These are, first, vigorous enforcement of the antitrust rules which prohibit undertakings from engaging in unjustified restrictive agreements or practices and from abusing dominant positions that they hold in the market. Here the focus is on the prevention of anticompetitive behaviour by the market players, such as price fixing or market sharing cartels, and from the disruption of effective competition.
Simultaneously, the control of concentrations is essential in order to circumvent a situation in which dominant positions on a market are created or reinforced through mergers and acquisitions. Secondly, the opening up of economic sectors in which effective competition has not been firmly established is pursued through a gradual liberalisation policy which accompanies legislative measures to further integrate the single market.
Thirdly, EU competition policy covers the control of state aid on a supranational level to ensure that state intervention does not distort the competitive situation of the market through subsidies and tax exemptions. EU competition policy plays an important role in achieving the competitiveness goals of the Lisbon agenda. It encompasses not only antitrust and merger rules which are fundamental to any well-functioning market economy, but also the application of an efficient and firm state-aid discipline.
In view of the world economic situation and efforts in Europe to ncourage growth, it is essential that the interaction between the various policy instruments at the Commission’s disposal is used to the best effect and that the improvement of the EU’s competitiveness remains high on the Commission’s agenda.
The legal meaning of conspiracy
Article 81 of the EC prohibits co operation between independent undertakings, which prevents, restricts or distorts competition. Specifically, its endeavour is to eradicate cartels and hardcore restrictions of competition. Article 81 also applies to co operation achieved through the decisions of trade associations or more informal understandings, known as concerted practices.
A difficult issue arises as to whether parallel behaviour by firms in an oligopolistic industry is attributable to an agreement or concerted practice between them, in which case Article 81(1) would be applicable; or whether it is a natural effect of the structure of the market, necessitating a different competition law response. In several decisions, particularly in the context of distribution systems, conduct which appeared to be unilateral has been held to be sufficiently consensual to fall within the scope of Article 81(1).
Different types of Agreements
A legally enforceable contract is an agreement. Some of these are compromise of litigation such as a trade mark delimitation agreements[ or the settlement of a patent actio. “Gentleman’s agreements” and simple understandings have also been held to be agreements, although neither is legally binding and the requirement that an agreement should be supported by enforcement procedures is lacking. A protocol which reflects a genuine concurrence of will between the parties constitutes an agreement within the meaning of Article 81(1)[6].
Connected agreements may be treated as a single agreements. It is permissible for agreements to be oral. The Commission treats the contractual terms and conditions in a standard-form contract as an agreement within Article 81(1). A time barred agreement whose effects continue to be felt can be caught by Article 81(1).
The constitution of a trade association is an agreement as per Article 81 and an agreement entered into by a trade association is an agreement by its members. An agreement to create a European Economic Interest Grouping (EEIG) or the bye-laws establishing it may be caught by Article 81(1). Although there is no formal agreement this does not preclude the finding of an agreement. In respect of agreements entered into unwillingly, the Commission may reduce a fine, not impose a fine or not institute proceedings at all.
Agreements, Concerted Practice
The Commission views agreements and concerted practices as distinct. However, it is not of much significance in defining the exact point at which an agreement ends and concerted practice begins. The Commission while holding parties guilty of concerted practice does not consider it necessary to determine whether they are party to an express or tacit agreement.
In the PVC decision, the Commission concluded that the parties to the cartel had participated in an agreement “and/or” a concerted practice. At the appellate stage the CFI upheld the Commission’s conclusion. The CFI held that joint classification was permissible where the infringement included elements of an agreement and of a concerted practice, without the Commission having to prove that there was both an agreement and a concerted practice throughout the period of the infringement. The Commission adopted a joint classification approach in British Sugar, in Cartonboard and in Pre-Insulated Pipe Cartel.
In Bayer AG v Commission of the European Communities it had transpired that between 1989 and 1993 the prices of Adalat, a drug used in the treatment of cardio vascular disease, was about 40% lower in cost in Spain and France than in the United Kingdom. This made wholesalers in those countries to export the product to the United Kingdom.
The Bayer Group, envisaging a huge loss of revenue, discontinued the fulfilment of the increasingly large orders placed by wholesalers in France and Spain and accepted orders only for volumes corresponding to the quantities traditionally sold in their home territories. The Commission alleged that there was an agreement between Bayer and the French and Spanish wholesalers to restrict exports to the United Kingdom. The Court of First Instance set aside this decision of the European Commission, because the Commission had not proved the existence of an agreement to restrict exports between Bayer and its distribution network.
The court further said that “proof of an agreement must be founded upon the direct or indirect finding of the existence of the subjective element that characterises the very concept of an agreement, that is to say of a concurrence of wills between economic operators on the implementation of a policy, the pursuit of an objective or the adoption of a given line of conduct on the market.”
The Concept of A “Single, Overall Agreement”
The Commission has developed the concept of a “single, overall agreement” based on a series of decisions from the 1980’s, for which undertakings bear responsibility, even though they may not be involved in its operation on a continuing basis. In Polypropylene the Commission investigated a complex cartel agreement in the petrochemicals sector involving 15 firms over many years. It held that the detailed arrangements whereby the cartel operated were all part of a single, overall agreement, which was oral, not legally binding and with no sanctions for its enforcement.
Having established that there was a single agreement, the Commission was able to hold that all 15 firms were guilty of infringing Article 81, even though some had not attended every meeting of the cartel and had not been involved in every aspect of its decision-making. On appeal the Court held that participation in the overall agreement was sufficient to establish guilt. The Commission reached similar conclusions in PVC, LdPE and in its second decision on PVC.
The CFI in PVC upheld the Commission’s view that an undertaking can be held responsible for an overall cartel even though it had not participated in all of its constituent elements “if it is shown that it knew, or must have known, that the collusion in which it participated … was part of an overall plan intended to distort competition and that the overall plan included all the constituent elements of the cartel”.
In Tréfileurope v Commission, one of the appeal in the Welded Steel Mesh case, the CFI held that the fact that an undertaking does not abide by the outcome of meetings which have a manifestly anti-competitive purpose does not relieve it of full responsibility for its participation in the cartel, if it has not publicly distanced itself from what was agreed upon in the meetings; this was reiterated in BPB de Eendracht NV v Commission, an appeal in the Cartonboard case. In Steel Beams the CFI held that attendance by an undertaking at meetings involving anticompetitive activities suffices to establish its participation in those activities in the absence of proof establishing the contrary.
The cumulative effect of these judgments is beneficial to the Commission in its anti cartel policy, since the Community Courts have deliberately refrained from construing the expressions agreement and concerted practice in a legalistic or formalistic manner.
Decisions by associations of undertakings
Independent undertakings co ordinate with each other by a trade association and this fact has been acknowledged by Article 81(1) of the EC, which has proscribed decisions of the trade associations which might restrict competition. The application of Article 81(1) to decisions implies that the trade association itself will be held liable and will thereby be fined. It has been held that the constitution of a trade association is in itself a decision, and such a constitution serves as the regulations governing the operation of an association.
An agreement entered into by the association might be a decision and a recommendation made by an association has been held to be a decision, and it has been clearly established that the fact that the recommendation is not binding upon its members does not prevent the application of Article 81(1). In IAZ International Belgium NV v Commission an association of water supply undertakings recommended to its members to refrain from connecting their dishwashing machines to mains system bereft of a conformity label supplied by a Belgian association of producers of this equipment.
The ECJ confirmed the Commission’s contention that this recommendation would restrict competition since it attempted to discriminate against appliances produced elsewhere in the EC. The regulations made by a trade association may amount to a decision within the meaning of Article 81(1).
A decision does not acquire immunity merely because it is subsequently approved and extended in scope by a public authority, nor does a trade association fall outside Article 81(1) because it is given statutory functions or because its members are appointed by the Government. In Commission v Italy the ECJ has specifically stated that the public law status of a national body does not prevent the application of Article 81. Article 81(1) is also applicable to decisions by associations of trade associations. If a trade association is not an undertaking, but is an association of undertakings, then Article 81(1) would be applicable to its decisions and not to its agreements.
Concerted Practices
The implication of the inclusion of concerted practices within the proscription of Article 81 is that conduct which is not attributable to an agreement or a decision might infringe Article 81(1). Though loose, informal understandings to limit competition have to be prevented, it is difficult to define the type or degree of co-ordination within the mischief of the law and to apply that rule to the facts of any given case.
In particular parties to a cartel may do all they can to destroy incriminating evidence of meetings, e-mails and correspondence, in which case the competition authority will infer the existence of an agreement or concerted practice from circumstantial evidence such as parallel conduct on the market. This is dangerous, as sometimes firms act in parallel not because of an agreement or concerted practice but because their individual appreciation of market conditions tells them that a failure to match a rival’s strategy could be damaging or disastrous.
The application of the law in this area is complex and competition authorities must proceed with care in order to distinguish covert cartels from rational and innocent commercial activities. The legal meaning of the term concerted practises will be considered in the sequel.
ICI v Commission or the Dyestuffs case was the first important case on concerted practices to be heard by the ECJ. The Commission fined several producers of dyestuffs, which it held had been guilty of price fixing through concerted practices. Its decision relied upon various pieces of evidence, including the similarity of the rate and timing of price increases and of instructions sent out by parent companies to their subsidiaries and the fact that there had been informal contact between the firms concerned. The ECJ upheld the Commission’s decision.
In Suiker Unie v Commission the Commission held that various sugar producers had taken part in concerted practices to protect the position of two Dutch producers on their domestic market. The producers denied this, as they had not worked out a plan to this effect. The ECJ held that it was not necessary to prove that there was an actual plan, because Article 81 strictly precluded: “any direct or indirect contact between such operators, the object or effect whereof is either to influence the conduct on the market of an actual or potential competitor or to disclose to such a competitor the course of conduct which they themselves have decided to adopt or contemplate adopting on the market”.
These two cases provide the legal test of what constitutes a concerted practice for the purposes of Article 81, namely that, there must be a mental consensus whereby practical co-operation is knowingly substituted for competition, but the consensus need not be achieved verbally and can come about by any direct or indirect contact between the parties.
In Züchner v Bayerische Vereinsbank AG the ECJ quoted both of these extracts when repeating the test of a concerted practice. In Polypropylene, PVC[52], and LdPE the Commission stressed that a concerted practice did not require proof of a plan and in LdPE BP, Monsanto and Shell were held to be parties to a concerted practice even though they were on the “periphery” of the cartel. In Sodaash/ Solvay the Commission pointed out that it would be unlikely that one would find a written record of an illegal resolution but held that, there are many forms and degrees of collusion and it does not require the making of a formal agreement. An infringement of Article 81 may exist where the parties have not even spelled out an agreement in terms but each infers commitment from the other on the basis of conduct.
The ECJ held in Hulls, one of the Polypropylene cases, that “a concerted practice… is caught by Article 81(1) EC, even in the absence of anti-competitive effects on the market”. In reaching this conclusion, the ECJ stated that, as established by its own case law, Article 81(1) requires that each economic operator must determine its policy on the market independently. In British Sugar, the Commission specifically concluded that there can be a concerted practice even in the absence of an actual effect on the market.
The onus is on the Commission to establish that there has been a concerted practice and the Community Courts have annulled decisions where they were unsatisfied with the evidence on which it relied. In particular, the ECJ’s judgment in Compagnie Royale Asturienne des Mines SA and Rheinzink GmbH v Commission established that, whereas parallel behaviour can be circumstantial evidence of a concerted practice, it cannot be conclusive where there are other explanations of what has taken place.
In 2002 the Office of Foreign Trade UK received complaints that British Vita plc, Vitafoam Limited, Kay-Metzeler Limited and Carpenter Limited had entered into anti competitive agreements or concerted practices, after the conduct of an investigation the OFT closed the investigation as these allegations proved to be false.
In 2001 the Commission established that six companies had operated a cartel in relation to zinc phosphate and accordingly imposed fines amounting to € 11.95 million. The CFI dismissed the appeal of four of these companies against these fines. The appeal was against the manner in which the Commission had calculated the fines and not the commission’s decision that they had breached Article 81(1) of the EC Treaty. This decision of the CFI provides useful guidance on the Commission’s approach to imposing fines in cartel cases[62].
In 2002, the Commission mulcted € 290.71 million on a total of sixteen firms after establishing that they had operated an illegal cartel in the plastic industrial bags market. This information was brought to the Commission’s attention in 2002 by a member of the cartel, British Polythene Industries (BPI), which received full immunity under the Commission’s 2002 Leniency Notice.
Several of the other firms received a reduction in the fine amount due to their co operation with the Commission. Six of Paris’ most prestigious hotels were fined for sharing commercial information in order to keep prices artificially high. These hotels the Crillon, Bristol, Meurice, Piazza Athene, Ritz and George V hotels were found by the French Competition Council to be exploiting their position at the luxury end of the market to effectively regulate prices.
It was held that they had regularly shared confidential information, including details of room rates and marketing plans, for the hotels’ commercial benefit. As these six hotels were in a league of their own in Paris, their practices had altered the normal rules of competition and created an unfair market.
Conclusion
In conclusion it can be surmised that hardcore cartels are among the most serious violators of competition rules. What distinguishes them from other anticompetitive practitioners is that they are secret agreements or concerted practices between competitors. It is due to this characteristic that they are considered to be cardinal sins. Cartels diminish social welfare, create allocative inefficiency and transfer wealth from consumers to the participants in the cartel.
Cartels are harmful over the long run and result in the creation of artificial, uneconomic and unstable industry structures, lower productivity gains or fewer technological improvements and sustained higher prices. Furthermore, the weakening of competition leads to a loss of competitiveness and threatens sustainable employment opportunities. For all these reasons, the detection, prosecution and punishment of secret hardcore cartel agreements is one of the central elements of the Commission’s competition policy and a number of instruments have been implemented to aid in this endeavour.
The decision to create a special unit was triggered by the fact that cartel members make use of ever more sophisticated tools enabling them to conceal their activities and to cover their tracks. The fight against cartels was given increased priority around the end of 1998. The Commission increased the resources devoted to the work and a unit specialising in the fight against cartels has been established in the office of the Competition Directorate-General. The year 2001 saw the culmination of investigations into 10 cartels involving a total of 61 firms. Some of the cartels were genuinely international while others affected only the European market. These decisions show the variety of industries which are afflicted with this malaise and some of these industries are chemicals, banks, airlines, beer and paper.
The fines imposed in 2001 totalled more than €1.8 billion. In dealing with individual cases, the Commission has recently taken a more economics-based approach in its state aid policy. It has reoriented its state aid policy towards cases and issues of significance for the further development of the internal market.
Another important issue has been the question of fiscal aid, where the exercise under the Code of conduct against harmful tax competition has lead to the identification of a number of potentially harmful tax measures which subsequently were the subject of state aid enquiries. A number of cases have been decided in this context, in some cases granting Member States a certain transitional period in order to adjust their systems.
EU competition policy plays an important role in achieving the competitiveness goals. It encompasses not only antitrust and merger rules which are fundamental to any well-functioning market economy, but also the application of an efficient and firm state-aid discipline. In view of the world economic situation in general and efforts in Europe to encourage growth, it is essential that the interaction between the various policy instruments at the Commission’s disposal is used to the best effect and that the improvement of the EU’s competitiveness remains high on the Commission’s agenda.
The Commission’s objective is to consolidate the commendable results achieved so far and at the same time to further intensify the fight against cartels. A second unit, also, devoted to the fight against cartels has been set up in the Directorate-General for Competition and this represents a substantial increase in the resources devoted to this all important work. From the foregoing discussions it is evident that the Court of First Instance and the European Court of Justice have contributed greatly to the strengthening of the anti – cartel enforcement policy and this is the prime objective of the European Commission’s agenda.
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