ARTICLES: EUROPEAN UNION - ITALY - ANTITRUST ENFORCEMENT - BARRIERS TO ENTRY - ART. 102 TFEU - UNFAIR PRICES - EFFICIENCY

Unfair prices: A few remarks on competition policy and antitrust analysis

Recent antitrust intervention against unfair prices in the pharmaceutical industry by the Italian and UK competition authorities, as well as the answer of the European Court of Justice to preliminary questions from the Latvian Supreme Court, have breathed new life into the longstanding debate on exploitative abuses. The aim of this contribution is to provide some remarks on how efficiency and fairness considerations combine in influencing both policy priorities and the specific economic and legal analysis in relation to antitrust enforcement against unfair prices under article 102 TFEU. Antitrust intervention against unfair prices most often takes place in “static” semi-regulated markets with high barriers to entry. In such markets, the potential costs and risks of over-intervention might be limited when cases taken up by Competition Authorities are well screened, there is robust evidence of a significant and unjustified disproportion between prices and costs and the risks of distorting dynamic competition are negligible.

I. Introduction 1. The key terms of the debate on the role that intervention against excessive prices should, or should not, have in the policy agenda of a competition authority are very well established, [1] engraved as they are also in the historic divide between jurisdictions where the treatment of excessive prices as an antitrust violation differs. 2. Indeed, it is a question that is often related to different cultures of competition law enforcement—the pure efficiency-oriented US policy as opposed to a broader European notion of competition law—and different views on the mandate and legitimacy of competition authorities to intervene in such cases. [2] At the same time, even though there is not a commonly accepted economic definition of what an unfair price is the debate is rich

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Gabriella Muscolo, Giovanni Pitruzzella, Unfair prices: A few remarks on competition policy and antitrust analysis, February 2018, Concurrences Review N° 1-2018, Art. N° 86062, pp. 60-67

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