Post by account_disabled on Mar 9, 2024 22:41:51 GMT -5
In practice, the European Commission has not always proceeded during the latter to define the relevant market, nor, when it has done so, has it used the SSNIP-test systematically. In this sense, RBB Economics carried out an analysis with the decisions of the Commission in phase II concentrations in the last 10 years (a total of 64) and formulated the following conclusions: In 28 of the 64 decisions, the SSNIP-test is not mentioned and the precedent is used to define the relevant market. In 36 of the 64 decisions reference is made to the SSNIP-test, but neither the bottom of the logic is reached nor is it finally applied. With that,. Some countries, such as the United States, have used other indicators in certain concentrations, such as the UPP Index (Upward Pricing Pressure), which, regardless of the relevant market definition, aims to capture the possibility of a unilateral price rise after a merger. . However, it was mentioned in the session that these tests could have important limitations.
Among the areas in which the application of the SSNIP-test and the delimitation of the relevant market are difficult, reference was made to the following two: In differentiated products: some specialists have come to suggest that the definition of the market resulting from the application of the SSNIP-test may be too narrow or broad, depending on the alternative products that have been considered, and that the analysis should focus on the proximity of the competition between companies. in digital markets: double-sided markets, characterized by the presence of indirect network effects, raise problems. The use value of each one of the groups depends on the number of users of the other, and, therefore, it is necessary to analyze whether it is necessary to define a market for each side or one as a whole. In addition, the price for one of the sides can USA Phone Number be zero, although there are still other parameters to analyze, such as quality and innovation. in such casos, el SSNDQ-test may be more suitable. It was suggested that in these casos the hypothetical monopolist test should serve as a conceptual framework, without prejudice to the fact that it may present practical difficulties of application depending on the caso.
Among other novelties of the draft, we find the following: The definition of the geographic market has not changed much, although the Commission has incorporated more guidance on it (for example, with respect to world markets) and the substitutability criteria are equally applicable to it. The Commission's approach to local markets has been specified, defined by areas of influence where 80% of sales or customers are concentrated. The new definition takes into account temporary conditions, such as seasonality. Finally, the debate was opened on the need (or not) to define in all caso the relevant market. The conclusions to highlight about the new draft are the following: The relevant market definition has to be adapted to the new digital economy, but it is still indispensable as a starting point for competitive analysis. The demand (i.e., customer) substitutability approach continues to prevail, and the hypothetical monopolist test (in its traditional version, SSNIP, or in its new versions, as SSNDQ) continues to be a main tool, although it is useful in certain casoIt's just as an abstract frame of reference. In short, the fundamental thing is not to reach a general solution, since each market, geographic and product, has its particularities. The important thing is to evaluate the competitive parameters and identify the limitations of each of them, with a view to protecting effective competition.
Among the areas in which the application of the SSNIP-test and the delimitation of the relevant market are difficult, reference was made to the following two: In differentiated products: some specialists have come to suggest that the definition of the market resulting from the application of the SSNIP-test may be too narrow or broad, depending on the alternative products that have been considered, and that the analysis should focus on the proximity of the competition between companies. in digital markets: double-sided markets, characterized by the presence of indirect network effects, raise problems. The use value of each one of the groups depends on the number of users of the other, and, therefore, it is necessary to analyze whether it is necessary to define a market for each side or one as a whole. In addition, the price for one of the sides can USA Phone Number be zero, although there are still other parameters to analyze, such as quality and innovation. in such casos, el SSNDQ-test may be more suitable. It was suggested that in these casos the hypothetical monopolist test should serve as a conceptual framework, without prejudice to the fact that it may present practical difficulties of application depending on the caso.
Among other novelties of the draft, we find the following: The definition of the geographic market has not changed much, although the Commission has incorporated more guidance on it (for example, with respect to world markets) and the substitutability criteria are equally applicable to it. The Commission's approach to local markets has been specified, defined by areas of influence where 80% of sales or customers are concentrated. The new definition takes into account temporary conditions, such as seasonality. Finally, the debate was opened on the need (or not) to define in all caso the relevant market. The conclusions to highlight about the new draft are the following: The relevant market definition has to be adapted to the new digital economy, but it is still indispensable as a starting point for competitive analysis. The demand (i.e., customer) substitutability approach continues to prevail, and the hypothetical monopolist test (in its traditional version, SSNIP, or in its new versions, as SSNDQ) continues to be a main tool, although it is useful in certain casoIt's just as an abstract frame of reference. In short, the fundamental thing is not to reach a general solution, since each market, geographic and product, has its particularities. The important thing is to evaluate the competitive parameters and identify the limitations of each of them, with a view to protecting effective competition.