Competition law and LIBOR in three jurisdictions: The United States of America, the United Kingdom and the European Union

Ball, Richard

Abstract

The London Interbank Offered Rate, better known as LIBOR, has ridden turbulent times over the last decade. Major banks, either through the collusion of individual traders operating on a discrete basis or on the instructions from more senior personnel, but always trading across national borders and on a global level, fixed the rate for at least four years. This resultant rigged market worked to limit competition and led to massive profits for the banks and individual traders. Furthermore it enabled banks to be insulated from the shocks of the market during the financial crisis of 2007-2008 and the consequences of that crisis.
The USA and UK are currently the largest and most important financial markets in the world, markets where most of the LIBOR manipulation took place, with the EU setting competition law standards for the European region. Therefore, this chapter will investigate this market manipulation through the lens of competition law, and specifically price fixing, from the perspective of the three jurisdictions of the USA, the EU, and the UK. Part one will describe the LIBOR system and the manipulation that took place before part two details the competition law requirements for each jurisdiction for enforcements at the public level, both civil and criminal, and at the private level. Part three will document the competition actions in the three jurisdictions that have taken place so far. Finally in part four the effectiveness of these actions will be examined, identifying problems and solutions for competition regulation of banking practices and questioning the current philosophical basis for competition regulation in general.

• Online Publication Date: Dec 7, 2017
• Publication Date: Jan 1, 2018
• Deposit Date: Apr 28, 2017
• Publicly Available Date: Dec 7, 2019
• Peer Reviewed: Not Peer Reviewed
• Pages: 163-200
• Series Title: Palgrave Studies in Risk, Crime and Society
• Book Title: White Collar Crime and Risk: Financial Crime, Corruption and the Financial Crisis
• ISBN: 9781137473837
• DOI: https://doi.org/10.1057/978-1-137-47384-4_7
• Keywords: competition law, antitrust, USA, UK, EU, LIBOR manipulation, civil public enforcement, criminal public enforcement, civil private enforcement, justifications
• Public URL: https://uwe-repository.worktribe.com/output/873106
• Publisher URL: https://www.palgrave.com/gb/book/9781137473837
• Contract Date: Apr 28, 2017