Pricing practices: Bundled sales and rebates

Firms often choose to sell several products as a bundle, associated with a rebate. In other cases, they offer rebates to those clients who commit to buy their products for a long period of time, or for a high volume. In many cases, these various rebates only pass on to consumers the economies of costs that the firms obtain themselves when they sell bundles, or when they benefit from a stable commitment from their buyers either regarding the length or the volume of their purchase. But in other cases, these commercial practices implemented by dominant firms prevent a competition “on the merits” to develop on the market and exclude some competitors to the detriment of consumers. Whereas the form based approach only checks whether the practice is indeed implemented by a dominant firm, the effects based approach focuses on the existence of a competitive harm. This allows a more rigorous and uniform treatment of these practices. These three papers develop the reasoning and the economic analysis followed by such an approach and analyze how the case law has evolved regarding the implementation of an effects based approach.