February 04, 2005, Business Standard

He is an economist and has no judicial background. But Frederic Jenny, 61, is a judge in his country’s apex court.

Jenny, who was in the capital for five days to attend a conference on competition policy, is a judge at Cour de Cassation, the French Supreme Court and sits in the chamber of commerce, economics and finance.

He is also the chairman of the OECD committee on competition law and policy.

The first time Jenny came to India was in the summer of 1966 as a student. Hitchhiking across Istanbul, Caspian Sea, Tehran, Kandahar and Lahore, he landed up at Amritsar before heading for Calcutta.

It was a short trip, he recalls, but the memories have stayed with him for long. His affair with India resumed seven years later when he took up a job for Paris Metro, an American newspaper based in France, as a journalist posted at Thiruvananthapuram.

Jenny is clearly excited about his latest trip to India as it coincided with the Supreme Court disposing of the petition challenging the validity of the Competition Commission.

“It’s a normal development,” Jenny says referring to the ongoing debate in India on who should head the commission: a judge or an expert in economics or business.

Over time, due to close interaction between the judiciary and economists in France, the regulatory system has developed a good understanding, he says.

Economists have started appreciating the procedural stuff and judges have realised that it is better to utilise the expertise of economists. They are quite happy to sit at the appellate level. Even in the US, there is a close relationship between lawyers and economists, he says.

Jenny has a lot of advice for the Competition Commission. The proof of whether a system is working well has to be backed by statistics, he says.

The French system, according to him, is working well as the commission there has taken good care of the “demonstration effect”. In about 30 per cent of the cases, the commission passes stiff orders.

While 80 per cent of these orders go into appeal, the French court of appeals on an average upholds 80 per cent of these orders. This gives a lot of credibility to the French competition authority.

Jenny explains how India with its federal structure can look at the EU model to implement its competition laws effectively. Technology and close interaction among EU countries is helping iron out issues related to implementing competition laws.

For example, as soon as any case involving more than one EU country comes up, it is put online and made available to authorities in all member-countries.

By exchanging the details of the cases, the problem of litigation in various jurisdictions can be avoided.

For example, when cases are filed in multiple locations, the EU Commission discusses them with members and the jurisdiction that is best equipped to handle the case finally takes it up.

The EU authority has the power to pull back the case and assign it to some other authority if it feels that the case is not being handled properly.

Jenny, who was the vice-chairman of the French Competition Authority before becoming a judge, has seen the French competition regulatory system evolve in the last three decades.

Going back to the early days of development of competition laws and their implementation in France, he points out that earlier the competition authority in France had only a recommendary role with the minister having power to make the decisions.

Things changed in 1986 when the system was amended and the competition authority received powers to make decisions with provision for appeal at the court of appeals.

While the authority has powers to summon people and ask for documents, it requests for warrants from the judicial authority when it comes to search and seizure.

On the issue of the competition authority’s independence, Jenny has the last word: “The key word is funding. No detail in the law can ensure independence. The bottom line is that the commission should not depend on the government for grants.”

Is the Indian government listening?