Cross-border digital trade (CBDT)—the online transactions that occur across countries—plays a vital role in driving global economic growth. Since harmonization of laws is essential to continue this momentum, key trade treaties such as the United States-Mexico-Canada Agreement and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership require member states to align their competition laws. However, these treaties do not specify the necessary level of harmonization, potentially leading to enforcement challenges that may undermine their effectiveness. Unfortunately, prior literature on this topic is limited and inapplicable as it is primarily focused on traditional industries. To determine the appropriate level of competition law harmonization that would promote both global and regional digital trade, this research identifies areas of convergence and divergence in competition laws among major economies, including the United States, the European Union, and Japan. Through a comparative study, it reveals that concerns regarding vertical restraints differ significantly depending on the jurisdiction’s domestic industry development. US antitrust law primarily emphasizes interbrand competition—competition among different brands—while European and Japanese competition law typically focuses on intrabrand competition—competition among suppliers and retailers—thereby facilitating the growth of digital startups. The divergence in these legal frameworks offers sophisticated and arguably diverse tools for regulating unprecedented global tech giants. Consequently, this research suggests that a low level of harmonization can be the most ideal model for fostering CBDT in the form of robust competition and innovation.

Authors:
Shin-Ru Cheng, Kyoto University, Japan

About the Presenter(s)
Dr. Shin-Ru Cheng is currently an assistant professor at the Graduate School of Law and Hakubi Center at Kyoto University, Japan.

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