This paper examines the application of the regulatory contract in the practice of economic concentration regulation from the standpoint of the theory of incomplete contracts. Based on the identification of transaction costs that arise at different stages of the conclusion and implementation of the contract, the limited rationality of both parties (including the regulator) is found. That leads us to the incompleteness of the contract. The involvement of the trustee institution in the regulatory contract is associated with the regulator's desire to remove some of the problems caused by the incompleteness of the contract (to minimize errors of type I and II under conditions of limited rationality). The risks associated with the use of the institution of trustees in regulatory contracts are also identified. Theoretical conclusions are then demonstrated on the empirical examples from Russian and foreign antitrust regulation practices. Reviewed cases: Bayer/Monsanto (2018); Anheuser-Busch Inbev / SABMiller PLC (2015); BASF/Cognis (2010).
Key words: antitrust regulation, incomplete contracts, regulatory contract, trustees.
JEL codes: L14, L38, L40, L41.
Sergei I. Fedorov, Nailya R. Galimova Role of Regulatory Contract in Control of Economic Concentration Transactions // Scientific Research of Faculty of Economics. Electronic Journal. 2020. Volume 12. Issue 3. P. 31-53