Peter Alexiadis and Alexandre de Streel  ‘Designing an EU Intervention Standard for Digital Gatekeepers’ (working paper)

This paper is quite long and dense, so I am afraid this review will be both as well. A series of studies and reports on digital platforms have suggested that antitrust policy requires an overhaul. This view is driven by the belief that, as regards digital markets, the risk of making “Type 2” errors (i.e., under-enforcement) is greater than the risk of making “Type 1” errors (i.e., over-enforcement); and that, in addition to competition enforcement, there may be a role for regulation as well. While the authors take the view that the imperative for radical change is less pressing in the European Union than elsewhere, it is nonetheless appropriate to develop a blueprint for intervention against digital platforms both ex post and ex ante. This blueprint is developed as follows: A first section outlines the principles governing when to intervene in the digital economy. The Internet has generated significant levels of consumer welfare. Digital markets nevertheless have characteristics which lend…

Gregory Werden and Luke Froeb  ‘Antitrust and Tech: Europe and the United States Differ, and it matters’ (working paper)

While merger and cartel enforcement lead to similar outcomes on both sides of the pond, there are significant differences regarding “abuse of dominance” and “monopolisation”. The European Commission and some national competition authorities in Europe have taken on tech giants in high-profile cases. However, hard-wired differences between the European and American enforcement regimes make very difficult for the US antitrust enforcement agencies to emulate their European counterparts. This piece, available here, seeks to identify these differences. A first set of differences relates to how an administrative model prevails in Europe, while the US system is mostly accusatorial. The European system was conceived of as regulation enforced by an administrative agency, not as law enforcement by the courts as in the US.  One important distinction in this respect is that a contested court order in the United States typically contains a series of conduct mandates and prohibitions, while administrative decisions usually merely provide for cease-and-desist orders. Furthermore, the European system is driven by…

Herbert Hovenkamp ‘Platforms and the Rule of Reason: The American Express Case’ (2019) Columbia Business Law Review, 1 34

In Ohio v. American Express Co. (“Amex”), the Supreme Court had its first explicit opportunity to apply the rule of reason to an allegedly anticompetitive practice on a two-sided platform– i.e. a business that depends on relationships between two different, noncompeting groups of transaction partners (e.g. newspapers, as regards readers and advertisers). This article, available here, considers how the rule of reason should be applied to an exclusionary practice on a platform market. It considers the rule of reason’s basic burden-shifting framework, unique elements of market delineation on platform markets, and the relevance of placing production complements into the same “market.” It criticises the Supreme Court’s unjustified conclusion that a market definition is necessary in an antitrust challenge to a vertical practice; its odd treatment of free rider problems; its lack of attention to the record and to economic analysis; and its confusion of total with marginal harms and benefits. Finally, it looks at the implications of the Court’s decision for market…

Pinar Akman on ‘Online Platforms, Agency and Competition Law: Mind the Gap’ (2019) 43 Fordham International Law Journal 209

The platform business model, inasmuch as it facilitates contracts between suppliers and customers, displays the qualities of an agency relationship more than any other commercial arrangement – and many platforms do indeed claim that they are mere agents. Since EU competition law does not apply to agreements between principals and agents – even where such agreements restrict competition – the implication would be that anticompetitive agreements between a platform and suppliers would fall outside the scope of, and could not be scrutinised by EU competition law. The same principle would apply to other competition system that adopts such an approach to agency (e.g. the US and many others). As a result, there is potentially a “platform gap” in the application of competition law in digital markets. This article, available here, argues that platforms’ relationships with their suppliers can be categorised as a principal-agent arrangement falling outside the scope of competition law. Since this “immunity” from competition law can have significant implications for…

Marc van der Voude ‘Judicial Control in Complex Economic Matters’ (2019) Journal of European Competition Law & Practice 10(7) 415

Already in the early 1960’s, the Court of Justice made clear that the application of competition law depends on contextual analysis that takes a wide range of economic and legal factors into account. Modern economics provides useful tools to deal with competition matters. The European Commission increasingly relies on these ‘mainstream’ economics in its assessment of competition cases, and courts have to make up their own mind on the merits of the Commission’s complex assessments and of the economic concepts on which the Commission relied to that effect. What kind of judicial control are the Union courts supposed to exercise over these complex assessments?  Under the current system set up by Article 263 TFEU, judicial review by the General Court, which has the final say on the interpretation of the facts of the case, is limited to the review of the legality of the Commission’s decision. In its case law, the Court of Justice has traditionally used formulae that suggest…

Massimiliano Kadar ‘Article 102 and Exclusivity Rebates in a Post-Intel World: Lessons from the Qualcomm and Google Android Cases’ (2019) Journal of European Competition Law & Practice 10(7) 439

Article 102 of the Treaty on the Functioning of the European Union (TFEU) prohibits behaviour by a dominant undertaking that is capable of harming competition. The notion of ‘capability to harm competition’ has been at the centre of the legal and economic debate for many years. A strict interpretation of ‘capability’ would require evidence of actual or quasi-actual effects on the market in the form of, for example, the exit of existing competitors or sustained price increases. A lax interpretation of capability could make it possible to enforce competition rules also in circumstances where harm to competition is purely hypothetical and not supported by concrete evidence. This discussion – which is ultimately about the level of the standard of proof – not only influences the likelihood of Type 1 and Type 2 letters, but also the amount of resources that administrative agencies needs to devote to individual enforcement cases. Modulating this impact are presumptions, which can lead to significant savings…

Cani Fernández ‘Presumptions and Burden of Proof in EU Competition Law: The Intel Judgment’ (2019) Journal of European Competition Law & Practice 10(7)

Some of the procedural tools used by competition authorities and courts (in particular, presumptions) present an inherent link to the burden of proof and to the rightful exercise of the rights of the defence. In principle, the use of presumptions can be an efficient response to the enforcement of competition policy both in situations where a given behaviour usually amounts to an infringement or where it is competitively innocuous. In any rule of law system, presumptions of illegality must be rebuttable. Indeed, a resort to presumptions not surrounded by proper procedural guarantees may infringe the presumption of innocence and undertakings’ rights of defence. The Intel judgment provides a good opportunity to discuss the role of presumptions under Article 102 TFEU and their implications for the burden of proof. In addition to this, this article, available here, analyses how defendants in exclusivity rebate cases can rebut the presumption of illegality in practice, with a special focus on the efficiency defence. It does so…

Jay Matthew Strader ‘Google, Monopolization, Refusing to Deal and the Duty to Promote Economic Activity’ (2019) International Review of Intellectual Property and Competition Law 50(5) 559

Almost no consumers have the resources to assess the quality of information online. Search engines seek to remedy asymmetries in information, effectively providing a quality certification service to consumers. Google claims to rank organic results ‘‘scientifically’,’ based strictly on relevance and the quality of the listings. Ninety two percent of all Google search traffic occurs on the first page, encompassing the top ten organic results and paid ads, which reflects high levels of consumer trust.   This paper, available here, argues that Google’s search engine is indispensable for innumerable companies, which cannot compete effectively when Google fails to rank organic results according to relevance. However, Google’s ad-based business model creates incentives for it to promote paying advertisers or its own business, in particular by lowering the rank of more relevant results. This leads to lower quality in the search market, to lower output in downstream markets and, ultimately, to lower consumer welfare – independently of whether Google operates downstream or…

Yannis Katsoulacos ‘Substantive Criteria and Legal Standards in Recent Abuse of Dominance Cases across the Atlantic’ (2019) CPI Antitrust Chronicle March

Legal standards in competition law fall across an analytical continuum whose boundaries are set, respectively, by categorical rules of condemnation (per se illegality) or acquittal (per se legality) on the one end, and an elaborate, fact-intensive assessment of reasonableness (Rule of Reason) on the other. These poles are connected by a range of intermediate tests that seek to combine some of the clarity and economy of bright-line rules with the greater analytical accuracy that a fuller examination of evidence can produce – e.g. in the US, the modified per se and the truncated effects based tests. This paper, available here, reviews a number of recent cases in high technology markets on both sides of the Atlantic (Intel, Google, QUALCOMM), to compare how abusive practices are treated in Europe and the US. Section II compares legal tests in the EU and the US. In the EU, there are multiple goals guiding antitrust enforcement. Under the influence of a strong Ordo-Liberal tradition, the…

Sean Ennis ‘Price Abuses: An overview of EU and national case law’ (2019) Concurrences

Pricing abuses can be viewed as a hybrid between regulation and competition law enforcement, since they raise questions of principle over when pricing that takes advantage of market power should be prevented by competition law action, by regulation or simply left unchallenged. In many cases – e.g. in predation, margin squeeze, rebates and excessive pricing cases – companies may have practical difficulties in assessing ex ante whether their pricing policies are illegally low (in the case of predation and rebates), illegally high (in excessive pricing cases) or some combination of both (in margin squeeze). This has the potential to influence those companies’ incentives significantly, an effect compounded by lack of predictability as to when such cases will be brought. As such, it is important to have a clear view of what types of cases have been brought recently. This is the object of this paper, available here, which reviews recent instances of price abuses in Europe. Section 2 looks at…