Business Strategy and Antitrust Compliance

Business strategy focuses on finding ways for a firm to approach the “monopoly profit,” while competition law is about trying to stop firms from doing this. Building on this tension, classic strategic management theory may at times lead companies to select strategies that raise antitrust risks. Focusing on three particular areas – influencing the competitor environment, cross subsidisation and defensive strategy – showcases a selection of potentially problematic strategies from the “classic” toolkit. Ultimately, boards, managers, and audit committees involved with strategy may benefit from focused compliance support to better identify the parts of the strategy toolkit that are higher risk than others, as well as the differences in risk by jurisdiction. The ultimate objective is to ensure companies’ strategies are both effective and legally defendable without holding back legitimate actions for corporate profit.