Jonathan Baker and Fiona Scott Morton on ‘Antitrust Enforcement against Platform MFNs’ (2018) Yale Law Journal 127 2176

 . This paper, available here, argues for more vigorous antitrust enforcement against Most Favoured Nation (MFN) provisions in the platform context. A MFN clause requires providers to refrain from offering their products or services at lower prices on other platforms. During the past two decades, antitrust enforcement against MFN provisions has grown, particularly in Europe. In contrast, there have been almost no enforcement actions against platform MFNs in the United States. The authors make a number of proposals to reverse this trend. The article is structured as follows: Part I shows how platform MFNs can harm competition and consumers, despite their potential competitive benefits. The authors’ draw on the economics’ literature on the effects of MFNs generally, and platform MFNs in particular. Simple MFNs commit sellers not to discount selectively, which assures covered buyers that they will be charged the lowest price offered by the seller. At first blush, one might expect this provision to lead to lower prices for covered buyers….

Chiara Caccinelli and Joëlle Toledano, focuses ‘Assessing Anticompetitive Practices in Two-sided Markets: The Booking.com cases’ (2018) Journal of Competition Law & Economics 14(2) 193

This paper, which can be found here, aims to shed light on the different approaches adopted by different European antitrust authorities to assess the allegedly anticompetitive MFN practices of a platform operating in a two-sided market. This is done by means of a law-and-economics analysis of the different approaches to Booking.com by competition authorities in France, Germany, Italy and Sweden, with an eye to discussing the specific difficulties raised by two-side market economics. The paper is structured as follows: Section II presents the key features of two-sided markets economics. Two-sided markets present some peculiar traits, which distinguish them from more “traditional” markets. Firms operating in these markets serve more than one group of consumers simultaneously and offer them the opportunity, as well as an interface, for fruitful exchanges. These value-enhancing interactions generate important direct and indirect network externalities among the groups, which platforms would typically aim to internalise. As a result, platform profitability depends not so much on the price level…

Jerome Pouyet and Thomas Trégouët ‘Assessing The Impact Of Vertical Integration in Platform Markets’ (2018) Competition Policy International Antitrust Chronicle December

This technical economics paper, which can be found here, argues that, in the context of vertical mergers, indirect network effects create a form of demand complementarity downstream that softens the anticompetitive effects of vertical integration. At the same time, vertical integration creates various sources of market power. How such market power is exerted, and its impact on competition, depends on how the integrated firm balances its price instruments to harness indirect network effects. This depends, in turn, on how each side of the market values the participation of users from the other side, or, in short, the structure of indirect network effects. The authors show, in particular, that there is no systematic correlation between stronger upstream market power and foreclosure of competitors or consumer harm. The paper is structured as follows: Section II introduces a framework to analyse vertical integration with two-sided network effects. The literature on vertical integration between an upstream input supplier and a downstream manufacturer has highlighted…

Michael Katz and Jonathan Sallet ‘Multisided Platforms and Antitrust Enforcement’ (2018) Yale Law Journal 2142

This paper,  available here, looks at two questions regarding competition enforcement in platform markets: (i) how should one account for the distinct characteristics of platforms when defining an antitrust market; and (ii) how, if at all, should one weigh user groups’ gains and losses on different sides of a platform against one another. In short, the authors argue that enforcers and courts should use a multiple-markets approach to multisided platforms, in which different groups of users on different sides of a platform belong in different product markets. This approach allows one to account for cross-market network effects without collapsing all platform users into a single product market. They further argue that enforcers should consider the price structure of a platform, and not simply its net price, when assessing competitive effects. This justifies the use of a separate-effects analysis, according to which anticompetitive conduct harming users on one side of a platform cannot be justified just because that harm funds benefits for users…

Sophie Lawrance and Edwin Bond on ‘Reverse-payment’ patent settlement agreements: non-cash value transfers are not immune from competition law scrutiny’ (2018) Journal of Intellectual Property Law & Practice 13(7) 552

This article – which can be found here – argues that a non-cash value transfer – particularly commitments by the producer of a branded drug not to launch a generic version of its drug – is able to bring a pay-for-delay agreement within the scope of the antitrust prohibition of reverse-payment patent settlement agreements. It does so as follows: The paper first looks at the law in the US as regards non-cash value transfer settlements. In its landmark 2013 FTC v, Actavis decision, the US Supreme Court held that pharmaceutical patent settlements which involve ‘large’ and ‘unexplained’ reverse payments may breach the antitrust rules. However, and as a result of the Supreme Court’s lack of detailed guidance, the lower US courts have in the last few years found themselves considering a fairly basic question: what constitutes a ‘payment’? While a couple of US district courts concluded that patent settlements that do not involve a cash transfer could not constitute unlawful…

Rennato Nazzini ‘Fresh evidence on appeal in two-tier administrative enforcement systems’ and Despoina Mantzari ‘Navigating the admission of evidence on appeal’ (2018) Journal of Antitrust Enforcement 6(2) 281

A second and third paper contain a discussion between two scholars – Rennato Nazzini and Despoina Mantzari – on whether an appellant should be able to introduce fresh evidence during a judicial review before a court. The discussion concerns a decision by the UK’s Competition Appeal Tribunal (CAT) in Ping Europe Ltd v Competition and Markets Authority (CMA) – the CAT’s first decision on the admission of new evidence in appeal proceedings on the basis of rule 21(2) of the CAT Rules 2015. This was a ruling on an application by the CMA to exclude certain evidence adduced by Ping that, in the CMA’s view, Ping could and should have adduced during the administrative proceedings. The facts were as follow. The CMA claimed that Ping had infringed the Chapter I prohibition and Article 101 TFEU by prohibiting online sales of its golf equipment. In response to the statement of objections (SO), Ping argued, among other things, that its prohibition on…

Michael J. Frese ‘Civil Liability for Single and Continuous Infringements’ (2018) World Competition 41 (2) 179

Infringement decisions by competition authorities in Europe provide irrefutable, or at least prima facie evidence of antitrust violations in follow-on cases brought before national courts. This binding effect of infringement decisions is meant to ease the burden on injured parties seeking to obtain damages. Evidentiary rules applicable to investigations thus have a bearing on the outcome of civil litigation and the scope of potential damages exposure. The single and continuous infringement (SCI) is an example of such an evidentiary rule. This legal construct alleviates the burden on competition authorities to prove individual details of cartels whose membership and activities may have evolved over time. However, appropriate limiting principles are required to ensure that defendants are not paying for harm they have not caused or could not have prevented. This article, available here, discusses the evidentiary value of single and continuous infringement findings in follow on damages litigation, and explores the available limiting principles. It is structured as follows: After the introduction,…

How to define two-sided markets? Ohio v American Experess

A recent US Supreme Court decision is  likely to have an impact on antitrust practice: Ohio v American Express 585 U. S. [to be determined] (2018), available here. In short, the case is about the correct antitrust treatment of anti-steering provisions introduced by American Express (Amex) into its contracts with merchants. The United States and several States (collectively, the plaintiffs) sued Amex, claiming that its anti-steering provisions violate §1 of the Sherman Act. The District Court agreed, finding that the credit-card market should be treated as two separate markets—one for merchants and one for cardholders—and that Amex’s anti-steering provisions are anticompetitive because they prevent competition in the merchant side of the market and results in higher merchant fees. The Second Circuit reversed; it determined that the credit-card market is a single market, not two separate ones; and that Amex’s anti-steering provisions did not infringe the Sherman Act. You may remember that I reviewed the Circuit court decision almost two years…

Anne C. Witt ‘The Enforcement of Article 101 TFEU: What has happened to the Effects Analysis’ (2018) Common Market Law Review (55) 417

This paper – which You can find here – focuses on the role that priority setting and institutional dynamics can have on public competition enforcement. It argues that, while the Commission has developed an impressive theoretical framework for assessing the effects of agreements on competition, there has in fact been very little effects analysis in the Commission’s decisional practice since 2005. Instead, most cases have been decided as ‘object restrictions’. The paper is structured as follows: A first section briefly retraces how the Commission came to endorse a more effects-based approach to EU competition law generally, and to Article 101 TFEU in particular. By the late 1990s, commentators had been long criticising the Commission for relying too heavily on form-based presumptions of legality and illegality in its assessments under Articles 101 and 102 TFEU. Commentators pressed the Commission to scale back the use of form-based presumptions in favour of more individual assessments in line with contemporary US antitrust law. The Commission…

Markus Reisinger ‘Asics vs Coty: Competitive effects of selective distribution systems in light of diverging court decisions’

Selective distribution systems are usually put in place in place to ensure that authorized distributors fulfil a certain quality standard, thereby avoiding losses in consumers’ brand valuation. Selective distribution systems often include clauses that allow manufactures to achieve better channel coordination in terms of prices, advertising, services, etc. A common way to do so is to restrict their selective retailers in advertising or pricing practices (e.g. to ensure that advertising campaigns or sales are coordinated). The paper – which can be found here – looks at recent German and EU cases on selective distribution systems, and tries to understand the differences between them. In the Asics case, the German Bundeskartellamt (BKartA) ruled that a selective distribution system by sport shoe manufacturer Asics, which included restrictions regarding online advertisement and price search engines, infringed competition law. By contrast, in the Coty case the European Court of Justice ruled that relatively similar clauses in the selective distribution system of a beauty products manufacturer were…