Definition Of Relevant Market Research Articles

Research on the Challenges and Improvement Strategies of Relevant Market Definition in Platform Economy

Research on the Challenges and Improvement Strategies of Relevant Market Definition in Platform Economy

Digital market and its adequacy of merger assessment in Indonesian business competition law

Purpose This study aims to analyze the development of digital market characteristics particularly focusing on how the strategic choices of platforms are not fully reflected in pricing. In addition, the implications for the development of theories of harm are investigated to explore the necessity of a relevant market definition in assessing infringement and evaluating the adequacy of Indonesian competition law. Design/methodology/approach This study is a legal analysis that uses statutory approaches, cases, comparative law and the development of theories of harm in digital mergers. The case approach is conducted by analyzing three cases decided by the Indonesia Business Competition Supervisory Commission. This approach provides insight into the response of Komisi Pengawas Persaingan Usaha concerning the merger and acquisition cases in the digital era as well as the provision of different analyses in conventional markets. However, competition can be potentially damaged in digital markets and a comparative law approach is taken by analyzing digital merger cases decided by authorities in other countries. Findings Results reveal that the digital market has created a “relevant market” that is challenging and blurred due to multi-sided network effects and consumer data usage characteristics. Platform-based enterprises’ prices fluctuate due to the digital market’s network effect and consumer data statistics. Smartphone prices depend on the number of apps and consumer data. Neoclassical theory focusing on product markets and location applied in Indonesia must be revised to establish a relevant digital economy market. To evaluate digital mergers, new harm theories are needed. The merger should also protect consumer data. Law Number 27 of 2022 on Personal Data Protection and Government Regulation on the Implementation of Electronic Systems and Transactions protects online consumers, a basic step in due diligence for digital mergers. The Indonesian Government should promptly strengthen the notion of “relevant markets” in the digital economy, which could lead to fair business competition violations like big data control. Notify partners or digital merger participants of the accessibility of sensitive data like transaction history and user location. Originality/value The development of digital market characteristics has implications for developing theories of harm in digital markets. Indonesian competition law needs to develop such theories of harm to analyze the potential for anticompetitive digital mergers in the digital economy era.

“The Case of Alibaba’s Skyrocketing Ticket.”--How to Define Relevant Market Identification in Internet Antitrust Law from a Comparative Law Perspective

This article would select the relevant market definition as a specific perspective as a research problem, and combined with the relevant provisions of the U.S. law. It takes the use of traditional comparative law in the concept of functionalism, in order to functional issues as a research method, to achieve a comparison between the two countries in the law under the provisions of the summary extracted from the different points. As a result, it could absorb and reference to the advantages of the laws of other countries in order to remedy for the filling of the shortcomings of China’s relevant legislation.

Competition effects of vertical integration in container ports: assessing the European Commission decisional practice

PurposeContainer liner shipping companies started expanding their business by investing in container port terminals in the late 1990s. This market entry results in an extensive presence of vertically integrated liners and terminals. This study aims to explore the competition effects of this vertical integration trend based on a regional (European) analysis. In particular, it extracts lessons from the European Commission (EC) cases on the competition effects of vertical integration. The critical analysis of the cases examined at the institutional level intends to reach conclusions on whether liner–terminal vertical integration harmed or advanced competition in the relevant markets and/or the extent that there is a need to revise the current policy practices.Design/methodology/approachThis study critically assesses the EC’s decisional practices in port container terminal vertical mergers in the last 25 years (1997–2021). Based on a literature review comparing maritime and competition economists' perspectives, it reviews the types of mergers examined, the methodology followed for relevant market definition and calculation of market shares and the estimated competition effects. The Hamburg–Le Havre area is the port range used as a case study for comparing the decisional practice with actual market developments. These container ports serve the greatest consuming market of final and intermediate goods in Europe and are gateways to Central and Eastern Europe.FindingsThe assessment identifies a need for expanding the investigation as a precondition for reaching conclusions on both the anti- and pro-competitive effects. First, only a limited number of transactions have been notified to the EC. Second, the empirical research identified a gap in this process, as there were no decisions (phase I) on vertical mergers between 2008 and 2016. Third, the exante assessment has not applied a phase II in-depth analysis to any case due to the absence of competition concerns. Finally, due to the absence of complaints, there is a lack of any ex post assessment of the effects of vertical integration.Research limitations/implicationsThis assessment is important for understanding the current and emerging features of intra-port and inter-port competition and the potential effects that the continuation and expansion of liner companies' vertical integration strategies will have along maritime supply chains. It also contributes to the broader discussion on liner companies' strategies, such as the research and policy-making efforts around the globe to understand the impact of both vertical and horizontal integration.Practical implicationsThese discussions are critical for a diversity of businesses that use liner shipping services or provide facilities and services to container shipping lines or ports. They are important for the interests of customers and consumers as they could inform any needed re-visiting of competition policy to protect from the dominance of any market developments that would lead to conditions limiting competition. Expanding analysis on the competition effects of non-notified mergers would help a better understanding of market changes.Social implicationsEnhancing competition and limiting monopolies is valuable from a consumer's perspective. This is more so in the case of maritime trade that serves the needs of societies. The study contributes by generating a better understanding of how decision-makers have worked towards that direction and what realignments are worthy.Originality/valueThere are no previous comprehensive reviews and analyses of the ways that policy-makers at the regional level have addressed the competition effects of vertical integration strategies of liner shipping companies when enhancing competition is valuable from a consumer perspective. Comparing maritime economists and competition, the study, via its literature review, also offers a comparison of maritime and competition perspectives on these competition effects, allowing positioning of how effective decisional-making practices have been.

Research on Market Definition of Digital Economy and Case Analysis: Based on the Perspective of Bilateral Market

In recent years, with the continuous development of digital economy, regulating the healthy development of platform economy has become an important issue. China's relevant government departments call for a clear adherence to the principles of “fair competition”, and for the strengthening of anti-monopoly and the establishment and improvement of market supervision to adapt to the development of the digital economy. In the process of anti-monopoly law enforcement, the relevant market definition is usually regarded as the logical starting point of analyzing the competitive behavior. Compared with traditional enterprises, platform enterprises have bilateral market characteristics such as “cross network externality” and “asymmetric price structure”, which face challenges in defining their relevant markets. This article first clear the bilateral market meaning, then discusses the platform enterprise bilateral market characteristics, and sort out the scholars in recent years about “define a single or multiple market” “assumed monopolist test is applicable”point of view, finally analyzed the “Sherpa's Abused Market Dominance” “Tangshan Renren Company v.Baidu Case” “Qihoo360 v.Tencent Case” three Chinese anti-monopoly law enforcement cases. The aim is to further discuss how to better combine the theoretical investigation and case analysis of qualitative and quantitative analysis to define the relevant market more accurately.

An Examination of Relevant Market Definition in the Digital Platform under the Nigerian Competition Legal Framework

Relevant market definition is key to any determination by the court or competition authority when ascertaining the level of competition in an industry or the likelihood of anti-competition conducts by the players in an industry. Using doctrinal method of research, this paper examines the provision of the Act in line with the peculiar nature of the digital market which operates on zero pricing with no possibility of price increase. The paper finds inter alia that the pricing criterion for relevant market definition does not fit digital market. The theory of harm introduced by the Act as an omnibus criterion for relevant market definition is not either very much helpful. The paper recommends the adoption of a modified Small but Insignificant Non-Transitory Increase in Cost (SSNIC) test. When using this test, the cost should be defined as consumer’s attention that amounts to the 5% to 10 % of the digital content.

Rethinking the legal regulation of Internet platform monopoly in China

AbstractThe existing regulatory regime for single firm exclusionary activity is primarily to establish a dominant position for a finding of an abuse, but there are challenges coming out of relevant market definition, market power determination, and the efficiency or innovation justifications. This paper argues for an alternative solution: an effects‐based analysis methodology for regulating platforms which are not proven to be dominant. Based on case studies including the Alibaba decision, JD.com case, Meituan case, and Visa case, it follows that we should stay focused on foreclosure effects while specifying the type of conduct that calls for careful scrutiny. But it is controversial to apply the traditional leverage theory and essential facilities doctrine to digital markets, which are of great significance to the determination of foreclosure effects. This paper introduces a “related markets hypothesis” to illustrate the leverage of market power, and applies a modified “costs‐based test” to determine whether the data resources held by the platform constitute a bottleneck. This paper finally proposes a classification scheme different from the criteria on a basis of company size. The decisive factors for classification include: form of platform enterprises, behavioral pattern, nature of market, market structure, and the competitive environment in related markets.

Dilemma and Breakthrough: Review on Substitution Analysis of the Definition of Relevant Markets and Platforms—From the Perspective of Guideline on Anti-Trust Platform Economy by the Anti-Trust Committee of the State Council

The prosperity of platform economy posed new issues for antitrust law enforcement and new challenges to the definition of relevant markets in antitrust investigations. Substitution analysis is not only a traditional method of relevant market definition, but also the underlying logic throughout the process of relevant market definition. It can still be applied to relevant market definition in the context of platform economy. Based on the Guideline of Platform Antitrust, this paper starts with the regulations about the definition of relevant markets in platform economy. It briefly analyzes the dilemmas of traditional methods of defining relevant markets in platform economy. Then, it reviews the limitation and rationality of substitution analysis of relevant market definition.

Towards Fair Pricing of Medicines?

Excessive pharmaceutical pricing cases in EU have progressed from a theoretical possibility to becoming a recurrent enforcement reality, following heightened law and policy attention on affordability of medicines. This matter gained considerable momentum in the wake of COVID-19 crisis as result of the increased health spending, with debates on affordability raging at WTO and WIPO levels. Unfair pricing in European competition law under Article 102a TFEU denote prices set by a dominant undertaking, capable of affecting trade between member states or in a substantial part of the Union, which do not have a reasonable relationship with their ‘economic value. The main points of dispute in previous jurisprudence and doctrine have concerned the definition of ‘reasonable’ and ‘economic value’ and the calculation of ‘excessiveness’ and ‘unfairness’, as per the seminal assessment test developed by the CJEU in its United Brands case. Although previously described as a ‘rarity’ in competition law, such excessive pricing cases can now be found in Italy, UK, Denmark and Netherlands but also on the DG Competition level. The investigation into Aspen's pricing practices by the European Commission, ending in a commitment decision whereby Aspen reduced prices by 73%, represents a historic case, capable of providing some guidance in this area of law and policy, seen against the doctrinal adversity to the prohibition. As intellectual property law and competition law, on the one hand, and policy issues related to Right-to-Health, affordable healthcare and pharmaceutical innovation on the other hand, interact to a high degree in this context, there is room for reflection on the role of competition law related to fair pricing of medicines. Following the introduction, the article will briefly recount the legal framework in European competition law related to excessive pricing. The third section will elevate the law and economics arguments related to excessive pharmaceutical pricing . The fourth section will detail the recent excessive pricing cases in the pharmaceutical sector. The fifth section will depict the assessment and decision by European Commission in the Aspen case. The sixth section analyses the Commission decision regarding definition of relevant market, dominance, thresholds and benchmarking and other unresolved issues relating to such enforcement. The seventh section concludes.

Multisided Platform Analysis and Competition Law Enforcement Practice in Brics Countries

Abstract As leading businesses organize themselves as two-sided platforms, developed economies competition authorities have adapted their practice. Younger jurisdictions also face the challenge to review and use new analytics. We explore the recent evolution of two-sided platform markets analysis in BRICS countries, focusing on a key point for competition policy enforcement: relevant market definition. The extensive review suggests that the countries have adopted the concepts and analytical practice for two-sided platform relevant market definition at different paces. Differences in competition policy institutional design might account for the heterogeneity. BRICS authorities with broader mandates, that handle larger number of cases, and with no separation between adjudication and investigation have lagged in the adoption of such tools and practices.

Excessive Pharmaceutical Pricing as an Abuse of Dominant Position – The Case of CD Pharma (Denmark)

Abstract On 31 January 2018, the Danish Competition and Consumer Authority adopted a decision1 finding the Swedish company generic distributor CD Pharma in breach of Art. 102(a) Treaty on the Functioning of the European Union (TFEU) by abusing its dominant position and having imposed excessive and unfair prices for the drug Syntocinon. The company increased the price of the drug by 2000% in the period April-October 2014 in the Danish pharmaceutical market. CD Pharma appealed to the Danish Competition Appeals Board,2 which on 29 November 2018 upheld the decision by the Authority. On subsequent appeal to the Danish Maritime and Commercial Court,3 the judgment by the previous court was upheld in a 3-2 decision on 2 March 2020, thus finding CD Pharma liable for infringement of Danish competition law as well as Art. 102(a) TFEU. The decision is final and not subject to further appeal. The case raises outstanding legal-economic issues regarding excessive pricing such as relevant market definition in pharmaceutical cases, the length of abuse, competitive price benchmarks, definition of economic value and the matter of dominance in public procurement and tenders. The case is rather unusual in that the alleged abusive period amounted to a six-month period, CD Pharma was the ‘losing’ party in the bidding process for the supply of the medicine in question, and CD Pharma subsequently had reduced prices through negotiations with the Danish central medicine procurer, Amgros. Similar to the Aspen Pharma decision4 by the Italian Competition Authority, where the Italian Medicine Agency (AIFA) reported the case to the Competition Authority, it was the Danish medicine procurer Amgros who had notified the Danish Competition and Consumer Authority about allegedly abusive practices. This subsequently led to an investigation and the adoption of the Decision. Following an introduction describing the Danish pharmaceutical market and specifics of the case, section two of this contribution details the proceedings at Danish Competition Authority. Section three depicts the proceedings at Competition Appeals Tribunal, and section four deals with the proceedings at the Maritime and Commercial Court. Section five concludes.

European Commission’s Notice on the Definition of Relevant Market for the Purposes of Community Competition Law, Comment of the Global Antitrust Institute, Antonin Scalia Law School, George Mason University

This comment is submitted by the Global Antitrust Institute (GAI) to the European Commission (Commission) for consideration in relation to its consultation on its Notice on the definition of relevant market for the purposes of community competition law.

Should There Be a Relevant Market Definition and Should All Parties to the Agreement Be Identified in Resale Price Maintenance Cases?

Anti-comparative Vertical Agreements

A UNIFIED PRESENTATION OF COMPETITION ANALYSIS IN TWO‐SIDED MARKETS

AbstractThe goal of this paper is to present quantitative tools to manage competition policy analysis in two‐sided platforms, based on a common framework for transaction and non‐transaction platforms. We explore tools for relevant market definition [Critical Loss Analysis and a small but significant non‐transitory increase in price (SSNIP) test], unilateral effects indicators [Upward Pricing Pressure (UPP) and Gross Upward Pricing Pressure Index (GUPPI)] and tests for exclusionary practices. We review dispersed results in the literature and fill the gaps where appropriate. We highlight the required changes from the usual one‐sided market framework and tools. While discussions of antitrust tools can be found in specialized forums devoted to advances in competition policy analysis, we organize the material in an integrated framework.

Relevant Market Theory in the Digital Era：From the Unilateral Market to the Bilateral Market

With the rocketing of the industrial economy and the digital economy, the EU has introduced a heavyweight competition policy in 2019, “Competition Policy for the Digital Era”. The relevant market theory is becoming the key area of antitrust economic research, and its academic and practical status has continuously improved. Constructing and developing the relevant market theory in the Digital Era has become a significant research field. This article comprehensively reviews the relevant market theory evolution and frontier under assumptions of the unilateral market and the bilateral market, and tries to provide a theoretical and practical reference for the current antitrust economic research and law enforcement practice. The study shows that: （1）The relevant market theory is crucial in antitrust economics. Although some articles advocate weakening market definition, in most cases, the relevant market theory is still the base point for antitrust analysis. （2）The bilateral market characteristics of the Digital Economy present theoretical and practical challenges to the relevant market definition. Traditional methods, based on the unilateral market, cannot be directly applied to antitrust research in the Digital Economy. （3）The academic circles have conducted extensive research on the relevant market theory in the bilateral market, but there are still many shortcomings in theoretical research and empirical analysis. We are so “ignorant” about the relevant market theory in the Digital Era.

Research on Anti-Monopoly regulation of data merge in the era of data-driven competition

ABSTRACT Data merge as a result of mergers between organizations that hold valuable data sets can create significant competitive advantage. The existing regime of Chinese merger control is based on turnover thresholds and might not be efficient for capturing data-driven mergers raising anti-competitive concerns. Also, the existing notion of relevant market definition and market power which form the backbone of the merger review might be of little use for assessing data-driven mergers. This paper analyses whether the Chinese lawmakers should introduce the transaction value-based thresholds to block data-driven mergers that might have serious anti-competitive consequence. Comparison is made with merger notification thresholds in Austria and Germany as they are the more active European member states when it comes to competition law enforcement in the data-driven era. Besides, both Austria and Germany have reformed their competition laws in 2017 to adapt the laws to the data-driven economy era. The new Austrian and German competition laws may well serve as inspiration for China. In addition, the paper also examines the definition of product market for data and what constitutes market power for that market. This paper argues that turnover-based thresholds can be inadequate to tackle competition law concerns due to data. Thus, transaction value-based threshold as an additional threshold of merger control would be a good option. The paper also argues that the existing notion of relevant market definition should be adjusted. Furthermore, the SAMR can no longer rely solely on market shares to evaluate market power. In this context, whether the data to be acquired and to what extent the said data can provide market power to the merged entities should be taken into account.

Merger Analysis in the App Economy: An Empirical Model of Ad-Sponsored Media

In the mobile app market, multiple monetizing policies such as paid and free ad-sponsored models co-exist. This paper proposes a novel model of ad-sponsored media with endogenous business model choice, that is applicable to the mobile app industry. The model defines an equilibrium over consumers’ downloads and usage decisions and app developers’ pricing and advertising decisions. The cost for a consumer to use an app is well defined regardless of the monetizing policy, enabling a Small, Non-transitory but Significant Increase in Cost (SSNIC) test for defining an antitrust relevant market. We estimate the model using mobile app data from Japan from 2015 to 2017. The SSNIC test shows that few non-game categories are relevant markets, whereas so are many game categories. The relevant market definition based on a full equilibrium simulation is aligned with this result. Furthermore, merger simulations show that the welfare damage is more pronounced in categories where the hypothetical monopolist's profit increases more in the SSNIC test, validating the use of SSNIC test as a convenient screening tool. Merger simulations suggest the importance of endogenous business model choice, because price increase is often caused by the shift from free to paid model. The endogenous business model choice also affects the implication of the platform transaction fee reduction. Contrary to the standard vertical relation, in the app economy, we find that a reduction in the transaction fee increases the price, because apps find it more profitable to charge price rather than show advertisements to consumers.

Platform competition and market definition in the US Amex case: lessons for economics and law

ABSTRACTThe rise of multi-sided platforms in the marketplace has spawned a vast amount of research to understand their implications for competition and welfare. This paper presents the scrutiny of one such academic work that classifies multi-sided platforms into “transaction” and “non-transaction” platforms for the purpose of relevant market definition. It has been posited that in the case of “transaction” platforms, there is one all-encompassing relevant market comprising of all sides of a platform. And such a “transaction” platform can compete only with another “transaction” platform. The U.S. Supreme Court in its Amex decision relied upon this classification and elevated the same into law. This paper identifies flaws in this concept by demonstrating that the relevant academic work defines “transaction” too narrowly. The paper takes the swift adoption of the “transaction” platform approach by the Supreme Court as an opportunity to also provide lessons for economics and law.

Application of Competition Law Against Business Communities Using Disruptive Innovation

In this globalization era, competition among businesses in the relevant market is very tight. The businesses still struggle to compete with business competitors in the relevant market. The formulation of the problem show the application of Competition Law Against The Business Communities Using Disruptive Innovation. The method used is doctrinal and non-doctrinal. The data used are primary data is data obtained directly from the source and the respondents and secondary data is data obtained from the literature. Analysis of the data used is the qualitative analysis.Research results are. Application of competition law to businesses that use disruptive innovation is disruptive innovation has a major impact on competition in the market concerned, namely the consumers, consumers can be prosperious, and against the competition, then the conventional business operators must improve in order to compete. The first step that must be carried out by the Commission in analyzing whether the behavior of taxi online or not anti-competitive conduct in the market concerned, the Commission specifically define the relevant market definition in advance. Even when the market changed or created by a disruptive innovator, competition authorities (Commission) faced with the need for the existing market segmentation or determining a new market. Determination of the relevant market is very important to analyze whether a taxi online anti-competitive conduct and whether it has market power and dominant position which may misuse. Model law relationship triangle in the transport line between online app provider producers and consumers should be clarified first. Limitation of liability as a legal subject of legal entities in the transportation business online application the extent of the responsibility. Under the laws relating to the legal entity must sphere of responsibility of legal entities is regulated and contained in the constitution of the legal entity itself. The scope and responsibilities of legal entities governed the rights and obligations of legal entities in the statutes and households (AD / ART entity). The online system of transportation is honest and does not impede competition there is no dominant position in the online business of transportation in producing and market share as qualification monopolistic practices and unfair business competition. Other online transport entrepreneurs to enter the market is not hampered transport other online who want to enter the transportation market online. Evidently many online businesses transport both two (2)-wheel or four (4)-wheel rampant in many cities.Keywords: Competition, Business Communities, Disruptive Innovation.

Necessity of a Broader Market Definition in the Analysis of Syndicated Loans

Market definition is the indispensable part of a competition analysis since it draws the boundaries of the market on two axes; product and geography. As it is accepted in the antitrust economics literature, from a methodological perspective the market definition is an instrument to properly reduce the complexity of market interaction. While a narrow market definition may ignore the products and the geographic areas that may exercise competitive constraints; a broad market definition may fail to discover anticompetitive behaviors properly. The main purpose of this study is to emphasize a proper market definition to assess the multilateral loans, including syndicated and club loans. In the study, to assess the relevant market definition for the multilateral loans, demand-side and supply-side substitutability are used as the main tools which are also mentioned in the guidelines of competition authorities. Based on the relevant economics and finance literature, we put the following findings: • Both on the demand-side and on the supply-side there are financial products that may exercise competitive constraints on corporate multilateral loans. For the borrowers, which might be financial institutions as well as large companies, syndicated loans and corporate bonds are two direct substitutes. Especially, for large companies, availability of substitutes increases through sophisticated debt instruments, such as medium term notes. On the supply-side, bilateral lending seems to be the closest substitute of multilateral lending. • Corporate multilateral loans have significant international characteristics and they cannot be isolated in any national border. While the companies and the financial institutions may borrow from domestic and foreign banks, banks may syndicate a loan to borrowers in any country. As the financial markets, have become more integrated geographically, the share of foreign banks in multilateral deals has increased gradually. Especially for emerging countries, like Turkey, the international multilateral loans have gained a critical importance to finance the domestic investments. Based on the above findings, to assess the investigated case, two main remarks appear that emphasize the necessity of a broader market definition for corporate multilateral loans: • Multilateral loans that includes the syndicated and club loans cannot be defined as a separate market independent from other substitute debt instruments, such as corporate bonds and medium term notes. • Such loans cannot be isolated from foreign markets and foreign lenders. The effective geographic market definition should be at the international level.