This presentation by Russell Damtoft (US FTC) was made during a roundtable discussion on Advocacy and Mainstreaming competition policy held at the 12th meeting of the OECD-IDB Latin American Competition Forum on 16-17 September 2014, Uruguay. Find out more at www.oecd.org/competition/latinamerica/

1. Mainstreaming of Competition Advocacy: the United States Experience
Russell W. Damtoft Associate Director, Office of International Affairs U.S. Federal Trade Commission OECD Latin America Competition Forum Montevideo, Uruguay, September 17, 2014
The views expressed herein are those of the speaker and do not necessarily represent the views of the Federal Trade Commission or any individual Commissioner.

2. Moving from Theory to Practice
•Last year in Lima, FTC Chairwoman Ramirez spoke about the importance of addressing anticompetitive governmental policies.
•This year, we turn to the practical question of turning theory into practice.
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3. Making our Case
•How do we get competition on the legislative and regulatory agenda?
–The theory behind advocating for pro- competitive governmental policy is well understood.
–But legislators and regulators must be responsive to many stakeholders.
–Stakeholders promoting competition can be few and far between.
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4. Where do we start?
•Three steps to facilitate successful advocacy:
–FIRST: Identify issues that are important to consumers
–SECOND: Establish relationships with regulators that focus on alignment of interests with competition agencies
–THIRD: Work with regulators to identify ways to harmonize competition with regulatory goals
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5. Step 1: Pick the Right Issues
•Cases with consumer appeal are more likely to gain support among policymakers.
•Identify competition issues with direct and easily understandable impacts on consumers: price effects or diminished access to goods and services.
•Successful advocacy in such cases can also pave the way for advocacy in sectors where the impact is less direct.
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6. Example: Dental Therapists
•Dental therapists can offer some dental services that dentists provide, perhaps at lower cost.
•A non-government body that sets dental education accreditation standards considered proposals that could restrict the ability of therapists to practice independently.
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•Effects would include:
–Reduced competition
–Limited access to dental services
–Discouraged innovative educational programs.

7. Example: Primary Health Care
•Advanced practice nurses can provide many basic health care services.
•Physician groups sought regulations to require nurses to affiliate with doctors.
•Effects would include:
–Possible higher costs
–Limited access to services
–Particular harm to underserved populations
–Inhibit innovative methods of service delivery.
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8. Example: Urban Transportation Services
•“Digital dispatch” services allow consumers to arrange and pay for transportation by smartphone application
•Taxi operators asked regulators to restrict the use of these “apps.”
•Effects would include:
–reduce price competition;
–eliminate an innovative new technology.
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9. Example: Real Estate Services
•Most homes sold through brokers.
•Brokers are paid a percentage of the price (usually 6%).
•Discount brokers and Internet sites challenge traditional brokers.
•Traditional brokers sought requirements that would:
–Limit fee-for-service providers, or
–Require brokers to provide a full range of service.
•Effects would include:
–Preventing brokers from unbundling services;
–Restricting innovative forms of delivery;
–Increasing costs
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10. Step 2: Build Relationships of Trust
•Regulators and competition agencies have a common interest: protecting the consumer.
–Regulators protect against particular types of harm (health, safety, fraud)
–Competition promotes lower prices, increased quality, service, and innovation
•In principle, there is no conflict between these goals.
–Competition agencies can help the regulator recognize how their interests align
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11. Alignment of Interests
•The challenge is to:
–build alliances with regulators, and
–develop a shared view that competition is consistent with regulators’ own goals, and can even help further those goals.
•Alignment of regulator and competition agency interests is a “win-win” outcome for consumer welfare: benefits of competition and regulation
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12. Example: Dental Therapists
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•Dental regulators ensure that treatment is performed only by trained, competent individuals.
•Competition by qualified dental therapists can reduce costs and make basic dental care available to more consumers.
•With interests aligned, regulatory solutions can protect consumers and allow competition to flourish

13. Example: Advance Practice Nurses
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•Regulators protect patients from incompetent care, unsanitary conditions, unsafe procedures and medicines.
•Competition from qualified health nurses can reduce costs and create new health care options for consumers.
•With interests aligned, patients received the protection of regulatory solutions and the benefits of competition

14. Example: Urban Transportation
•Regulators are charged with ensuring vehicle safety, insurance, and prevention of deceptive practices.
•Permitting entry by firms that offer safe but more flexible and affordable urban transportation options should be consistent with taxi regulators’ goals.
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15. Building Relationships
•Our goal is to build a culture of shared problem- solving where the competition agency’s expertise can complement the regulator’s sectoral expertise:
–Start at the staff level
–Become a resource
–Attend conferences, establish liaison arrangements, detail of staff between agencies, etc.
–Share expertise and analysis in a constructive and mutually beneficial way fashion.
•This requires interpersonal skills as much as competition expertise.
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16. Nurture the Relationship
•Show regulators your interest in maintaining a relationship over time and that you want to learn about developments in the regulatory scheme that may impact competition.
•Consider how and when to intervene: the goal is not to publicly embarrass or undermine support for the regulators.
–Informal (behind the scenes) versus formal (public)
–Experience suggests greater receptivity and success when the comment is invited.
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17. Regulatory Capture
•Sometimes, regulators’ views become so closely aligned with the regulated sector that the regulator does not distinguish between industry and consumer interests.
•Alignment of interests strategy may not always work in such cases.
•In a few instances, U.S. Agencies have taken law enforcement action against regulators.
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18. Step 3: Balancing Competition & Regulation
•Once suitable topics for intervention have been identified and alliances have been established, help the regulator to:
–Develop a framework for understanding the impact of an anticompetitive regulation; and
–Identify options that impose less or no restrictions on competition while achieving other legitimate policy goals
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19. Analytical Tools
•“Because I said so” doesn’t work!
•Tools to harmonize the regulatory goal and objectives of competition may include:
–Studies quantifying the cost of regulation;
–An analytical framework to explain the likely effect on price and quality;
–Experience of other jurisdictions that illustrate the potential for consumer harm; and
–Options for avoiding a negative impact while achieving regulatory goals.
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20. Example: Dental Therapy
•In the dental therapy case, FTC staff pointed to Australia, where dental therapists have been providing services autonomously and safely for years.
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21. Example: Advance Practice Nursing
•FTC gathered statistics on the harms of limited access to healthcare in West Virginia and identified potentially hidden costs of regulation
•Cited evidence of safe practice by advanced practice nurses
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22. Examples: Urban Transportation
•FTC staff submitted formal comments to regulators that:
•identified the types of consumer harm that might result, and
•Highlighted less restrictive alternatives to achieve legitimate public interest goals
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23. Example: Real Estate Services
•DOJ letter to Montana regulators explained how other states had allowed competition without bad results
•Making cost of regulation transparent through website.
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24. Further resources
•OECD
–Competition Assessment Toolkit (contains tools to assist governments in evaluating new and existing draft laws)
•The International Competition Network
–Recommended Practice on Competition Assessment
–Advocacy Working Group Toolkits
–The Curriculum Project Advocacy Module
•The Inter American Competition Alliance
–The Alliance has held several calls to discuss advocacy experiences of member agencies.
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25. Conclusion
•Bringing competition policy into the mainstream of public policy is a necessary complement to a competition advocacy strategy.
•A significant body of work has gone into creating such tools.
•While challenges exist, success can be achieved when a carefully crafted and thoughtful strategy is employed.
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