Glossary of competition terms

This Glossary was prepared by DG COMP and the OECD for non-competition specialists. Each term is enriched with references of national case laws from the e-Competitions Bulletin. (© European Union - © OECD)

Buyer power

Ability of one or more buyers, based on their economic importance on the market in question, to obtain favourable purchasing terms from their suppliers. Buyer power is an important aspect in competition analysis, since powerful buyers may discipline the pricing policy of powerful sellers, thus creating a "balance of powers" on the market concerned. However, buyer power does not necessarily have positive effects. When a strong buyer faces weak sellers, for example, the outcome can be worse than when the buyer is not powerful. The effects of a buyer’s strength also depend on whether the buyer, in turn, has seller power on a downstream market.

© European Commission