Eugenio Olmedo-Peralta ‘The Evidential Effect of Commitment Decisions in Damages Claims’ (2019) Common Market Law Review 56 979

The European Commission and national competition authorities (NCAs) make extensive use of commitment decisions. Since these decisions do not establish the existence of competition infringements, claimants still have to bear the burden of proof in stand-alone damages actions concerning conduct covered by them. However, some evidential effects should be recognised to commitment decisions, as well as to certain statements made in the context of related public enforcement proceedings. This article, available here, describes such effects as follows. Section II outlines the relationship between commitment decisions and the private enforcement of competition law. According to Regulation 1/2003, commitment decisions are adopted without concluding whether competition law has been infringed. Commitment decisions merely state that there are no longer grounds for action by a competition authority, as the behavioural or structural measures taken by the companies involved in an investigation are sufficient to put an end to the potential restriction of competition. In short, the main features of commitment decisions are that: (i) they…

OECD competition policy responses to COVID-19

This policy brief, which you can find here, discusses how competition policy can help address the immediate challenges raised by the COVID-19 crisis, whilst looking to the post-pandemic future. It describes competition principles that governments can follow when designing support measures for the economy, and outlines actions competition authorities can take to address the challenges of the current crisis. Section A focuses on state interventions, while Section B focuses on competition enforcement actions in the short and medium term. A first section concern as regards state intervention is maintaining competitive neutrality. In times of extraordinary, and temporary, demand and supply shocks, governments can support consumers, workers and firms to weather the storm while ensuring readiness to resume economic activity once the crisis passes. This may take the form of grants, subsidies, bank guarantees or other state support. Nonetheless, there is a danger that state support may distort the playing field between companies that receive aid and their competitors that do…

Jorge Padilla and Nicolas Petit on ‘Competition policy and the Covid-19 opportunity’ (2020) Concurrences 2 1

Every economic crisis raises the same normative question for competition law. Should decision makers be temporarily more permissive in their application of the law to private and public restraints of competition? While historical evidence suggests that this is a bad idea, most economic crises since the 1970s led to some softening of competition law. In countries around the world, massive amounts of state aid have been injected into the economy. While such policies deserve praise in their concern for the protection of jobs, recessions have a “cleansing effect” which is desirable and can be dampened by such interventions. Recessions facilitate the exit of zombie firms that crowd out growth opportunities for more efficient competitors, and delay the diffusion of technological innovation. A case might thus be made that the current recession might be a source of opportunities for the EU economy, long trapped in a cycle of weak productivity, low economic dynamism and conspicuous absence of superstar firm creation. The…

Frederic Jenny ‘Economic Resilience, Globalization and Market Governance: Facing the Covid-19 Test’

Globalisation contributed to the rapid spread of COVID to all corners of the globe. The economic cost of fighting the virus froze a number of economies and disrupted global value chains, and is likely to be followed by several years of an economic depression that will dwarf the cost of the 2008 financial and economic crisis. The dramatic events of the first quarter of 2020 challenge some of the implicit assumptions underlying the design of our economic systems, and should make us think about some of the dilemmas and trade-offs that this crisis has foisted upon us. This piece, available as a working paper here,  is not mainly about competition – instead, it is a piece that thinks widely about the implications of this pandemic for the economic architecture underpinning globalisation, which also touches on competition. This is because, in the grand scheme of things, competition law and policy plays a relatively limited role when markets are not in equilibrium,…

OECD work on Competition and the Financial Crisis (2009)

This paper can be found here. Systemic crises reopen the question of what is the role of competition policy in such scenarios. The main issues are whether competition is desirable at all in times of systemic crises, and how to limit potential negative effects of state intervention on competition in the medium and long term. The paper investigates these questions, and is particularly interesting because it was written while the aftershocks of the crisis were still being felt. It notes that while the crisis started in the financial sector, it had an important impact on the real economy. Nonetheless, the paper focused mostly on interventions in the financial sphere, which are – at least at present – of limited interest to us. As such, I will focus on the sections of the paper that are likely to prove more relevant to us going forward. Section II provides an overview of the relationship between the financial sector and competition law. Most of…

OECD work on Excessive Pricing (2011), looking also at price gouging

The OECD has ever written anything on competition law and price gouging. It has, however, asked Prof. Frank Maier-Rigaud to write a paper exceeding 80 pages on Excessive Pricing in 2011 (see here). Despite its title, the paper seeks to provide a framework for all exploitative practices. This is well beyond my focus today, so I will review those sections of the paper relevant for sudden price increases and exploitative practices following sudden shocks. The first and second sections discuss ideas of fair prices and economic value, and whether intervention against excessive pricing is justified. The idea of a just, fair or natural price, and with it the concept of economic value and rudimentary equilibrium notions, can be traced back to ancient Greece. They have occupied political philosophers and economists for well over 2000 years. Despite this longstanding debate, the fundamental question of the appropriate benchmark for assessing whether prices are unfair, unjust or excessive remains unresolved to this day….

Viktoria Robertson on ‘Excessive Data Collection: Privacy Considerations and Abuse of Dominance in the Era of Big Data’ (2020) Common Market Law Review 57 161

It is debatable whether EU competition law already contains – or could and should potentially develop – antitrust theories of harm that apply to third-party tracking of personal user data on the web. Focusing on data gathering, this paper – available here – assesses two scenarios under which EU competition law may deem the vast amounts of data gathered by certain digital platforms excessive: excessive data “prices” and unfair data policies. In both cases, the competition law assessment is autonomous from other areas of the law: while a breach of data protection rules is not automatically a breach of competition law, a company adhering to data protection rules may still violate competition laws. The paper finds that EU competition law already possesses the necessary tools to address excessive data collection, while data protection rules provide much-needed context for this type of exploitative abuse. Section II discusses data gathering through third-party tracking. Tracking occurs both on the web and in applications (apps) for electronic…

Marco Botta and Klaus Wiedemann  ‘To Discriminate or not to Discriminate? Personalised Pricing in Online Markets as Exploitative Abuse of Dominance’ (2019) European Journal of Law and Economics 1

The advent of big data analytics has favoured the emergence of forms of price discrimination based on consumers’ profiles and their online behaviour (i.e. personalised pricing). This paper, available here, analyses this practice as a possible exploitative abuse by dominant online platforms. It concludes that such practices can have ambiguous welfare effects, and be subject to a case-by-case analysis. It also argues that competition law is more suitable than omnibus regulation – particularly data protection and consumer law – to tackle the negative effects of personalised pricing, particularly because competition authorities could negotiate with online platforms different kinds of behavioural commitments that could significantly tame the risks of personalised pricing. Section II looks at price discrimination in online markets. Economists typically distinguish between three different types of price discrimination. First-degree price discrimination takes place when a firm is able to discriminate perfectly among its customers. Second-degree price discrimination means that the firm discriminates between its customers by granting discounts once…

Daniele Condorelli and Jorge Padilla ‘Harnessing Platform Envelopment through Privacy Policy Tying’ (working paper)

Entry into platform markets subject to strong network effects and high switching costs can occur in two ways. First, by offering drastically new functionality (i.e. through Schumpeterian innovation). Second, through “platform envelopment” whereby a provider in one platform market – the origin market – enters another platform market – the target market – and combines its own functionality with that of the target in a multi-platform bundle that leverages shared user relationships and/or common components. Envelopers capture market share by foreclosing an incumbent’s access to users; in doing so, they harness the network effects that previously had protected the incumbent. This working paper, available here,  revisits the economics of “platform envelopment”, with a focus on data-related strategies. In particular, it analyses the logic and effects of “privacy policy tying”, a strategy whereby the enveloper requests the consumers’ consent to combining their data in both origin and target markets. This allows the enveloper to fund the services offered to all sides…

Wolfgang Kerber ‘Data Sharing In IoT (Internet of Things’) Ecosystems And Competition Law: The Example Of Connected Cars’ (2019) Journal of Competition Law & Economics (forthcoming)

In Internet of Things (IoT) ecosystems, one firm often has exclusive control over the data produced by a smart device, as well as of the technical means of access to this device. Such a gatekeeper position can empower firms to eliminate competition for aftermarket and other complementary services in these ecosystems. This paper, available here, analyses whether competition law can help address problems concerning access to data and interoperability in this context, by reference to connected vehicles. In short, it argues that, while competition offers some solutions to these data access problems, on its own it is insufficient to fully address these problems. As such, additional solutions such as data portability requirements, data access rights or sector-specific regulation might also be needed. Section II provides a brief overview of the economics of digital ecosystems and of data interoperability. Data tends to be non-rivalrous in use. It follows that data should be used as much as possible to maximise its value….