In the current issue of the magazine GRUR Int. I have published an essay together with David Saive entitled “Antitrust by Design – The prohibition of anti-competitive coordination and the consensus mechanism of the blockchain“. The article is based on a very intensive scientific dialogue where I learned a lot. Before we published it in the magazine, we were already nominated for the concurrences antitrust writing awards.

But what does Antitrust by Design actually mean? In very simplified manner, this is both a contradiction and a requirement. Contradiction in the form that we discuss the challenges of effective public antitrust law enforcement for technologies that are essentially intended to create a consensus between the parties involved. This may in particular – but not exclusively – be the case with many blockchain or distributed ledger technologies. Here it is repeatedly stressed that “the blockchain was immutable”. However, what about effective enforcement of injunctions under competition law? Is it possible to enforce them at all and, if so, to whom, if all participants in the network are possibly holders of information sensitive to competition? This leads again to the second statement, “by design” means requirement. This is not to be understood as meaning directly private enforcement in the sense that someone may demand that someone else do or refrain from doing something. Rather, it is a question of the aspiration in the sense of an expectation of effective compliance. If consensus is absolutely essential, how can companies still comply with it for certain technologies or projects? And much more importantly, from a dogmatic point of view, how is this compatible with the freedom of competition?

One way to solve this problem is to include consensus mechanisms in the organisation of compliance from the outset. Consensus and therefore trust would be established only as long as and to the extent still permitted by antitrust law. What is meant here is the obvious need to comply with applicable antitrust law. Effective compliance would thus be incorporated or programmed into the technology, so that no anticompetitive coordination or exchange of information can already occur. Antitrust by Design thus refers to the fundamental statement “anti-trust” and is intended to prevent anticompetitive behaviour by companies that leads to trust that is no longer permitted. In practical terms this might possibly mean that measures have to be found prophylactically which in any case are illegal under competition law. In addition, the technical systems and software must be designed in such a way that they are already compliant on a proactive level and do not merely represent a reaction to coordination or information exchange already implemented. If you want to read more about this, I also recommend my article in the magazine InTeR (December issue 2018), which you can find here in full text on Telemedicus.

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Sebastian Louven

Rechtsanwalt Sebastian LouvenSince 2016 I have been an attorney at law. I advise mainly on antitrust law and telecommunications law. Further focal points of my work are intellectual property law as well as distribution law and IT law.