Dear Readers,
Price gouging is perhaps the most paradoxical of antitrust offenses. Courts and regulators are at pains to point out that the mere possession of monopoly power is in itself not problematic. Yet the most natural expression of monopoly power – charging monopoly prices – is nonetheless a potential infringement.
Drawing up appropriate rules and benchmarks to assess price gouging is notoriously difficult. For this reason, authorities and courts are loath to enforce this aspect of the law. The picture is further complicated by the myriad adjacent rules and regulations governing prices in various jurisdictions, and on a sector-by-sector basis.
Nonetheless, the basic goal of the antitrust rules is to protect consumers from the illegitimate exercise of market power. The law and its enforcers must therefore tread a fine line, as must companies possessed of market power. Authorities are ill-equipped to become generalist price regulators, yet are obliged to act when faced with a clear infringement. Companies are rational market actors with legitimate profit motives, yet must avoid liability.
The contributions to this Chronicle seek to cut this Gordian knot. These articles are all the more timely since the question of price gouging has become live in 2020, due to supply shortages and stockpiling during the COVID-19 pandemic. The question of excessive pricing will perennially occupy the backs of the minds of regulators, but recent events have brought it to the forefront.
As always, thank you to our great panel of authors.
Sincerely,
CPI Team
